Shein, a Chinese e-commerce company specializing in fast fashion, plans to raise $1 billion at a $100 billion valuation. What makes a juggernaut like Amazon or Zara shiver?
Specific and highly effective formula
This is the information collected and shared by very serious specialized media BloombergShein, who was able to speak with people familiar with the matter: Shein is currently in discussions with investors, including token General Atlantics, to raise $1 billion and thus reach the $100 billion valuation mark. Conversations, at this time, are not final and the numbers specified here can change.
Last May, the Chinese company confirmed that it was not planning an initial public offering. Shein, headquartered in Guangzhou in southern China, has become a true global reference in the fast fashion sector thanks to its unique operations.
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As shown Take CrunchThe company’s designers closely follow social media influencers as well as fashion shows to design new pieces, a method not much different from that used by other fast fashion brands. However, what sets Shein apart is the responsiveness of its supply chain, which consists of an extensive network of loyal and flexible workshops around the city of Guangzhou. The company tests a wide range of inexpensive clothing in small batches, and if the data shows something is selling well, it quickly places more orders with its suppliers to sell more. This demand-driven approach allows Shein to keep costs low.
Shiin never stopped growing
In addition to Guangzhou, Shein also has operations in Singapore and Los Angeles. It also offers more than 600,000 items to customers in more than 150 countries. Nearly two years ago, his results were such as to cast a shadow over the e-commerce giants and the fast fashion sector.
For example, Shein was the second most downloaded shopping app in the US after Amazon in 2021. But while Shein continued to enjoy great momentum, installs grew 68% year over year, and Amazon saw a 2.4% decline. Worldwide, Amazon was the fourth most downloaded shopping app, surpassed by Shopee from Singapore and Shein and Meesho from India.
So it looks like Shein is on her way to continuing her momentum and growing even more. If it reaches its $100 billion target, it will then become the world’s third largest startup by valuation, behind ByteDance, the parent company of TikTok and SpaceX.