Fashion marketplace Coutloot buys Once Again Store
Bengaluru: Coutloot (MJVS Fashion Services Pvt. Ltd), an online platform that sells pre-owned fashion, has acquired Bangalore-based competitor Once Again Store (Stororo Services Pvt. Ltd) for an undisclosed amount in an all-stock deal, said a senior company executive, signalling early consolidation in a sector that has spawned success stories such as Poshmark and Rent the Runway in the US and Secoo in China.
Coutloot, which was founded in November 2015 by Jasmeet Thind, Mahima Kaul, Sahil Khimavat and Vinit Jain, currently operates three business models. The company either collects the product from the seller after an order is placed, charging the seller a 20% commission on the value of the product, or picks up a product from the seller, stores it at a fulfilment centre and ships it out to a buyer once a sale is confirmed, charging the seller 25-30% of the price of the product as commission.
It is also piloting a peer-to-peer (P2P) model, wherein the company connects the buyers and sellers, charging the seller 15% commission. The acquisition of Once Again Store, which operates a P2P platform, is tied to this vertical, said co-founder Thind. The team at Once Again Store has joined Coutloot.
“In a P2P model, the unit cost reduces by about 40%. It is also very scalable,” said Thind.
Coutloot raised $100,000 from Venture Catalysts in June last year. In December, the company was selected by Facebook Inc. for the FB Start programme, which entails $40,000 worth of credits and services from Facebook and partners such as Amazon Web Services, Adobe and Dropbox among others.
Coutloot claims about 200 sales a day, with an average order value of Rs750 as against about 50 daily sales clocked by Once Again Store, which was founded in February 2015 by Umang Chordia and Nikita Agarwal while still at college.
According to industry experts, about 20-odd start-ups have been launched in the past 24 months to tap the market for pre-owned branded and designer apparel and renting garments. Companies such as Share Wardrobe, Elanic, Envoged, Etashee and Stylish Play are marketplaces for pre-owned premium women’s apparel brands, while LibeRent, FlyRobe and SwishList rent premium brands and designer wear.
The Indian start-ups have, however, struggled to replicate the success of global peers. While apparel rental start-up Klozee shut shop early last year, Spoyl, an online marketplace for pre-owned apparel, acquired rival Revamp My Closet last February.
According to Wazir Advisors, a consultancy firm, the premium women’s wear market is a Rs9,000 crore segment, about 6% of the Rs1.4 trillion women’s apparel market.
Even venture capital firms have not placed enough bets on such start-ups in India. Some of the other start-ups to have received funding are Klozee, Flyrobe, Elanic, Envoged and Zapyle.
This is in sharp contrast to the US and Chinese markets, where investors have poured funds into companies in these sectors. About 12 online marketplaces in the US, including Poshmark and The RealReal, have raised about $230 million, according to data provided by Tracxn, a firm which tracks start-ups. In the rental space, about 10 start-ups in the US, including Bag Borrow or Steal and Rent the Runway, have raised about $162 million.