The web-only fashion retailer, which gets 90% of its revenue from monthly subscribers, raises $85 million. The retailer has raised $250 million to date.
JustFab Inc. has raised $85 million in a new funding round that values the fashion e-retailer at $1 billion.
New investor Passport Special Opportunity Fund led the round, which also included existing investors Shining Capital, Matrix Partners and Technology Crossover Ventures.
The retailer’s latest funding round, which brings its total funding to $250 million, will allow JustFab to strengthen its balance sheet, says Adam Goldenberg, the retailer’s co-CEO. “While we didn’t need to raise money, as a capital-intensive business, this round allows us to continue to scale each of our business units quickly and comfortably,” he says.
The funding proves investors’ appetites for the retailer’s business model—90% of JustFab’s revenue comes from subscribers who pay $39.95 a month to buy an item such as shoes, handbags, denim or athletic apparel, tailored to their tastes, he says. While Goldenberg did not detail definite plans for the retailer to go public, he says that the funding gives him “confidence that going public is where we are headed.”
JustFab, No. 118 in the Internet Retailer 2014 Top 500 Guide, earned $254 million in revenue last year. It plans to grow 57% this year, as it expects its sales to reach $400 million and to reach $500 million next year, he says.
For $39.95 per month, JustFab members receive fashion product offerings tailored to their tastes each month via e-mail. The retailer’s members can skip buying any month, as long as they notify JustFab by the fifth of the month. Shoppers can also pay a premium price—between $49 to $69 per item—to buy items without becoming a member, although less than 1% of the e-retailer’s sales come from shoppers buying this way, the company says.