Secret Sales has secured €10m in Series A funding from retail investors as it accelerates plans to become the largest non-full price online marketplace for fashion and beauty worldwide.
The investment round, completed following growth during Secret Sales’ first year in business as a marketplace, was led by the family-backed private equity and growth capital investor Perwyn Growth Capital and supported by Belerion Capital, the ecommerce investment specialist and early stage investor in ASOS, The Hut Group and Boohoo.
Investec advised LRG Online Limited, trading as Secret Sales, on the fund raising venture. Perwyn was advised by Grant Thornton (Financial), Weightmans (Legal), Digital Pathfinders (Technology), Performify (Digital Marketing) and Miriam Lahage (Commercial).
Secret Sales will use the money to advance technological development, scaling its ecommerce platform to compete as a huge global player in the discount retail space. The marketplace will expand its UK operation alongside launching in new territories in 2021, bringing hundreds more brands and retailers onboard to drive both domestic and international growth.
The investment will also enable Secret Sales to improve data mining capabilities to optimise user experience on the platform, which in turn will increase sales and customer engagement for its brand and retail partners.
“Our Series A funding round from experienced investors validates the significant opportunity for Secret Sales’ business model worldwide, and will allow us to meet increasing demand from brands and retailers looking for an upmarket, profitable and sustainable way to sell non full price inventory,” says Chris Griffin, CEO of Secret Sales. Following an exceptional first year, we are now ready to accelerate domestic and international operations, spearheading a new era for the discount sector.”
Premium off-price ecommerce marketplace Secret Sales has grown by 4,000% since launching in March 2020, and is currently showcasing over 700 brands on its platform. It is due to go live in six further countries in the next year.
“Secret Sales is revolutionising the way brands deal with excess stock through a technology-driven, capital light model,” adds Iain McDonald, Founder at Belerion Capital. “We are very happy to support the team as the business begins its next stage of growth. The opportunity exists for Secret Sales to partner with prestigious brands on a global basis to clear excess stock in a brand-accretive manner and learn more about their customers at the same time."
The marketplace’s business model enables fashion houses to clear non full price inventory in a brand-enhancing environment, while driving new customer acquisition via a GDPR-compliant opt-in where customers can choose to hear directly from brands’ full price channels.
“Secret Sales has built a modern online marketplace that works in partnership with brands and retailers - it’s a true disruptor in its sector,” says Dan Sheahan, Managing Director at Investec. “We’ve helped match two strong investment partners with one of the most exciting value propositions in retail. They are backing Chris Griffin, an entrepreneur with a track record of creating market leading retail technology, having successfully sold his earlier company Anatwine to Europe’s largest ecommerce fashion retailer Zalando in 2017. We look forward to continuing to work with the business as it seeks to dominate the off-price retail industry.”
Dolce & Gabbana, Versace 19v69, G-Star Raw, Superdry, Ted Baker and Jigsaw are among brands selling on the platform alongside premium retailers including YNAP, Harvey Nichols, JD Sports Group and high street jewellery business F Hinds. Many have appointed Secret Sales as their sole or primary discount channel in the UK.
“We are delighted to lead this round of growth capital as the business prepares itself for further UK and international expansion,” said Ravi Sharma, Partner at Perwyn. We have been extremely impressed by what the management team has built to date and look forward to the coming years as we look to scale the business further.”
Matt Purt, co-owner of Secret Sales, comments: “We are thrilled to have closed this funding round and to embark upon the next stage of our amazing journey. We are fast becoming the dominant platform that puts ’brand’ first in the non full price space, providing brands and retailers with a route to market to sell overstock quickly and profitably every season, while preserving and growing rather than eroding brand equity.”
Purt concludes: “Holding onto stock for too long is costly. By partnering with Secret Sales, sell-through can be optimised in real time. The investment will further enable us to innovate and deploy proprietary data AI to help fashion houses sell discounted inventory faster, supporting cleaner inventory in season, gaining higher margins and introducing new gateway consumers to their own channels. It’s time for the industry to reset and to stop thinking about non full price stock solely in terms of cash recovery. We are the platform that will enable this for thousands of brands globally.”