The UK-based e-commerce site Lyst has raised $40 million in a round of funding to expand internationally and to keep in pace with the competition.
Lyst is a UK-based fashion site that allow people to shop in more than 11,500 different online stores using a single check-out. It is fondly called as shopping mall for fashion. It acts as universal shopping cart for the customers to make purchase across different designers and stores. The site has items from Saks Fifth Avenue, Harrods, Valentino, J. Crew and Neiman Marcus. The startup is also working on to make the shopping experience more personalized by arranging and organizing clothes and accessories on the basis of the season or the current trends like ‘Denim for Spring’ or ‘J.Crew’s Timeless Classics.’ The company take a portion of the sale amount as its revenue.
With its good growth in the business, the startup managed to raise $40 million in a Series C round of funding from Groupe Arnault, Accel Partners, Balderton Capital, DFJ, 14W and an unnamed New York hedge fund. Since the inception of the company in 2011, it has managed to raise $60 million on the whole. The startup’s competitor Farfetch revealed its company’s valuation to be $1 billion, whereas Lyst hardly bothered to do so.
When asked about it to Chris Morton, founder and CEO of Lyst, he said, “We never disclose valuation. I don’t think it is healthy for my team to obsess over. I recognize the industry is all about chasing unicorn status these days but we don’t want to be part of that conversation.” He also stated the company has made millions in sales through the brands on its platform and the company’s revenue has been tripled ever year for the past three years. Total sales add up to $150 million compared to $40 million a year ago.
This fashion startup is not free from competitors. Its rivals include Farfetch, Shoptiques and Pinterest who are few other aggregating online sites. But Lyst stands apart in couple of ways. One is the big and complete market of online stores and designers that is augments with more than 11500 brands. Two, it focuses only on the fashion its website, a strategy that will attract only active browsers and not much of the casual ones. Three, the shopping experience it gives to its customers like to add personalize touch to shopping by suggesting clothes of their taste by learning through their previous purchases. The site uses a lot of algorithm to do so. Last, the single cart system makes the whole shopping experience very simple. Also, the singe cart system is what that boost the sales of the company.
With the raised funding, the company is planning to do for international expansion and design websites for every country separately. Moton states, China is one of the fastest growing markets for their company. The startup is also working on to design a strong app for mobile platforms too to attract customers who enjoys shopping on their phone rather than on the web. It also confirms that it would give enough importance for web interface too unlike its competitor Spring. Sources say that the company may later move beyond fashion and clothing and include items like furniture of particular brand to be sold in one place.
The global expansion of the company with the fund seems to be a smart idea looking into the fact that the company generates its revenue on connect and referral percentages, making the business model one of the economies of scale.