Venture Capital Club Deal in Farfetch
Farfetch is a real startup success stories in Europe. Sallfort was able to secure itself a slot in the USD 110 million round. Sallfort’s clients have invested alongside the bank’s shareholders joining big players on the global investment scene.
Farfetch is one of THE startup success stories in Europe. Founded by Portuguese José Neves in 2008 in London, Farfetch has redefined the fashion industry in the high-price segment and in 2015 already reported a turnover in merchandising volume of USD 520 million. That is an increase of 70% compared to the year before. In 2016 the marketplace is continuing to dynamically grow.
Farfetch is not an online shop but brings the product portfolio of 400 luxury fashion shops from all over the world online as the largest high fashion marketplace. That means merchandise already ordered and delivered to shops becomes available worldwide and can be shipped anywhere in the world within 2-3 days. The customer therefore has access to the by far largest range of goods in the high fashion segment and the product is available immediately as well. For Farfetch this means no warehouse, no own logistics, no purchasing risk.
No wonder has the last investment round before a planned IPO drawn a lot of interest from international venture capital investors. Sallfort was able to secure itself a slot in the current USD 110 million round. Sallfort clients will invest alongside the bank’s shareholders joining big players on the global investment scene such as Temasek from Singapore, China based IDG Capital Partners as well as Eurazeo, the Parisian investment house already invested in Monclair and Desigual. "Farfetch is surely a premium investment for Sallfort and we are very pleased that through our network we were able to gain a slot in this round", says Michael Bornhaeusser, Partner of Sallfort and Managing Director for the division Private Equity, Products & Services. "This is already our second pre-IPO investment and again we see a very good upside due to the massive growth of the company especially in the Asian region", Bornhaeusser continues.
Development of IT Platform and Growth in Asia
The investment resources will mainly be used to continue developing the company’s own technological platform in order to establish a world leading multichannel platform for boutiques and labels worldwide and expand Farfetch’s offer to the global fashion industry. At the same time the company wants to consolidate its leading role in China, Farfetch’s second largest market, Japan and other countries in the Asian-Pacific region.
Besides the new investment in Trocafone, the market leader for the trade of second hand smartphones in Latin America and the partial trade sale of San Francisco based SEAL Software, Farfetch is already the third transaction for the Venture Capital Department of Sallfort Privatbank in 2016.
The Venture Capital Club Deals
The model of the so called «Club Deals» is new for venture capital investments in Switzerland. After due diligence the shareholders of Sallfort Privatbank AG decide on the investment and invite their clients to invest alongside them. The clients decide from case to case whether they want to invest in a particular company: They then buy directly into the portfolio company. Thereby no expensive fund structure is necessary, the fees are correlatively lower and clients have absolute freedom of choice for their personal commitment. A management fee as known from venture capital funds will not be charged.
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