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PITCH
World’s most stylish unicorn Farfetch presents an extensive yet coveted selection of luxury fashion, while offering brick-and-mortar boutiques a global reach and competitive technology solutions.
WHY?

Fragmented market

Difficult to find specific designer product with thousands of boutiques scattered around the globe.

Inefficient logistics system

Designer labels typically ship from a single warehouse, instead of utilizing boutique networks.

Boutiques lack resources, clout

Independent boutiques, lacking resources to build a successful online presence, are hence limited by geography.

MARKET

€249 billion

Global personal luxury fashion and goods market

Farfetch founder José Neves estimates that online sales make up just 10% of the fashion market, so fashion e-retailing is “still unchartered territory”.

PRODUCT
Omnichannel marketplace for luxury fashion goods from around the globe; from established names to cult and emerging designers. The website is available in nine languages with local currency conversion option. For businesses, Farfetch offers white-label solutions via Farfetch Black & White, analytics and CRM technology.
Omnichannel marketplace for luxury fashion goods from around the globe; from established names to cult and emerging designers. The website is available in nine languages with local currency conversion option. For businesses, Farfetch offers white-label solutions via Farfetch Black & White, analytics and CRM technology.
BUSINESS MODEL
Luxury brands and designers sell directly to customers on Farfetch’s online marketplace, paying 22–25% commission. Farfetch holds no stock, so it has zero inventory risk. It also runs an API business, and is redefining the online-to-offline experience (across its e-store, partner traditional boutiques, and Store of the Future).

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Objective: To revolutionize the luxury fashion industry by equipping traditional boutiques with digital technologies to boost their competitiveness in today’s online-dominated world –– but without sacrificing their charm, individuality and other advantages.

In the company’s own words, “How can brands negotiate these fluid boundaries without losing their magic and mystery?”


Farfetch works with luxury boutiques and brands to synchronize their inventories – both in physical stores and in warehouses – which allows Farfetch to be asset-free. The company provides its partners with multichannel CRM and in-store analytics.

Through its independent business unit, Farfetch Black & White, the company offers white-label solutions and support for mono-brand online boutiques (i.e., giving them the e-commerce tools that they can use for their own websites).


Brands under the marketplace are divided into two categories:

  • Luxe: high-end designers and leading experimental brands such as Alexander McQueen and Givenchy.

  • Lab: contemporary and emerging labels such as Acne and Simone Rocha.


Farfetch’s global network stores enables it to offer express delivery worldwide and the “click-and-collect” option. It also uses this network as the backbone for same-day delivery in select cities:

  • London

  • Paris

  • Los Angeles

  • New York

  • Miami

  • Milan

  • Rome

  • Barcelona

  • Madrid

For logistics, the startup partners with local courier companies as well as DHL and UPS.


Farfetch has offices in 11 cities, including London, Tokyo and Los Angeles. While it started out as an online platform, Farfetch strongly believes in the value of a physical store experience, and in 2015, it acquired renowned London boutique Browns. Its Store of the Future business unit also seeks to redefine the online-to-offline shopping experience.

TIMELINE

  • Launch
  • Growth
  • Recent Developments
  • Future Plans
  • 2007–2008 - Launch of Farfetch with 25 boutiques; collapse of Lehman Brothers two weeks after; failed to raise funding amid world financial crisis.

    Read in detail:

    The launch

    October 2007, José Neves started Farfetch to enable small designers and fashion retailers to become global players through a single online marketplace.

    • At the Spring/Summer Paris Fashion Week 2007, Neves realized that the growing boutiques all had strong online operations.

    • Business initially based out of Portugal.

    • Bootstrapped.

    2008, official launch of Farfetch with 25 boutiques in five countries.

    • Brought independent boutiques from North America and Europe under one online marketplace platform.
    Challenges

    Two weeks after Farfetch launched, Lehman Brothers collapsed. In the global financial crisis that ensued, the startup could not secure any outside investment for nearly three years.

  • 2010–2013 - Steady growth; series of funding rounds.

    Read in detail:

    Fundings

    July 2010, secured US$4.5 million from Advent Venture Partners.

    • Its first funding ever.

    January 2012, raised US$18 million from Index Ventures, eVenture Capital Partners and Advent Venture Partners.

    • Brought total funding to US$24 million

    March 2013, closed a US$20 million funding round led by Condé Nast, with participation from Advent Venture Partners, Index Ventures and e.ventures.

    • Cash used for international expansion.
    Key personnel

    July 2010, new board member, Brand and Strategy Director and Chief Operating Officer.

    • Former Creative Director at Harrods and Selfridges Susanne Tide-Frater joined as Brand and Strategy Director.

    • Former Managing Director of membership-only online retailer Cocosa Andrew Robb joined as Chief Operating Officer.

    • Frederic Court, General Partner at Advent Venture Partners, joined the board.
  • 2014 - Raised US$66 million to grow in the US, Asia and Brazil; annual sales reached US$275 million.

    Read in detail:

    Products and services
    November, added “click-and-collect” service.
    Expansion

    January, clocked US$2 million sales in a single day.

    US$275 million in annual sales, with a year-over-year growth rate of 100%.

    7 million average monthly pageviews.

    Average order US$650.
    Fundings

    April, raised US$66 million led by private equity firm Vitruvian Partners, with participation from Condé Nast International, Advent Ventures and Richard Chen, venture partner at Chinese VC firm Ceyuan Ventures.

    • Cash used to grow the business in the United States, Brazil and Asia.
  • 2015 - Series E funding at US$1 billion valuation; Browns boutique acquisition; launched Farfetch Black & White (API business); annual sales reached US$512 million.

    Read in detail:

    Products and services

    September, launched Farfetch Black & White: a fully fledged agency with white-label solution for brands.

    • By using Farfetch’s API, the brands, even through their own websites, can offer inventory from their physical stores.

    • The API-based solution makes it easy for brands to integrate with other services, such as WeChat.

    • Pricing model undisclosed.

    October, introduced same-day deliveries in nine cities.

    • Available for specific postal codes in London, New York, Los Angeles, Miami, Barcelona, Madrid, Milan, Rome and Paris.
    Expansion

    Reached US$512 million of gross sales via website with average of 10 million visits per month; sales record for a single day was US$8 million.

    Fundings

    March, became a unicorn after securing a US$86 million funding round led by DST Global, with participation from Conde Nast and Vitruvian Partners.

    • World’s second most valuable luxury technology startup after Net-A-Porter.
    M&As
    May, acquired iconic London boutique Browns.
  • 2016 - Raised US$110 million in Series F funding; TheOutnet founder Stephanie Phair joined as Chief Strategy Officer.

    Read in detail:

    Fundings

    May, raised a US$110 million Series F round led by Temasek, IDG Capital and Eurazeo, with participation from Vitruvian Partners.

    • Brought the total amount of capital the company raised to over US$305 million.

    • The deal valued Farfetch at around US$1.5 billion.
    Key personnel
    November, Stephanie Phair, Founder and President of TheOutnet, the discount site of Net-A-Porter, joined as Chief Strategy Officer.
  • 2017 - Net-A-Porter founder Natalie Massenet joined.

    Read in detail:

    Key personnel

    February, Net-A-Porter founder Natalie Massenet joined as non-executive co-chairman.

    • Massenet is also Chairman of the British Fashion Council.

    • Listed on TIME magazine’s world’s 100 most influential people in 2014.
  • Recent Developments

    Now the world’s second largest online retailer of luxury fashion, posting 70% yearly growth since its founding in 2008.

    Unicorn status, valued at almost US$1.5 billion.

    Over 1,000-strong staff across 11 offices worldwide; average age of staff is 31.

    Team includes Net-A-Porter founder Natalie Massenet as non-executive co-chairman.

    700 boutiques in its network, across nearly 40 countries.

    Largest markets: the United States, Asia (especially China).


  • Future Plans

    Further expansion in (online-to-offline) O2O, with digitally enhanced physical stores via new business unit, Store of the Future.

    Same-day delivery worldwide.

    IPO.

Updated: 02/2017
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