Aside from the £82.5m we’ve already seen invested in 2016, there’s a real buzz around the space with both Asos and Topshop launching fashion tech accelerator programmes. Topshop has teamed up with L Marks to create Top Pitch; an accelerator looking to discover the next in wearable tech fashion. And Asos and Telefónica’s Wayra have launched an 8 month programme to cherry-pick “mature startups with a proven track record” in the fashion tech and ad space.
‘Tinder for fashion’: Grabble
In 2015, Hackney-based Grabble was touted as one to watch by Forbes contributor Edmund Ingham. Since then, the ‘tinder for fashion’ platform has embodied the move from desktop to smartphone –boosting user engagement by 500% to 40,000 users with the launch of its own iPhone and android app.
Founded in 2013 by Daniel Murray and Joel Freeman, Grabble allows users to browse fashion items from a variety of high street, designer, and cult labels. The company garnered the ‘tinder for fashion’ plaudit with its: swipe left for no, right for yes functionality. The app has also added content, curation, and after sales features, which give Grabble room for co-branding or native advertising – the answer, Murray believes, to an increasing reluctance on behalf of users to put up with ads.
Grabble has raised £1.59m to date, with backing from a number of industry experienced London Business Angels. Last year Murray and Freeman hired the ex Global Head Stylist for Net a Porter Group, after announcing plans to expand in the US and Asia.
The Virtual Fitting Room: Metail
With offices in London, Cambridge, and Singapore, Metail is the online fitting room that allows users to try on clothes virtually. Using user measurements, Metail claims to be able to deliver a 94-96% accurate 3D MeModel complete with personalised hairstyle and skin tones.
In the past, Metail has teamed up with Glamour magazine as part of a campaign to allow readers to dress like Serena from Gossip Girl. More recently, the company agreed a contract with Brazil’s largest eCommerce player Dafiti. Founder Tom Adeyoola’s long term vision, however, is to become the ‘Google of size and shape’.
“We want everyone to have their own MeModel to use in any clothing related experience to improve and enhance it”, says Adeyoola. “If they do, then we will be custodian of the world’s size and shape dataset, like Facebook is of the world’s social graph”.
Metail has raised £15.3m equity investment to date, with backing from New World Private Equity, and TAL Apparel.
The luxury brand: Temperley London
Worn by the Dutchess of Cambridge – albeit with amendments – on the recent royal tour of India, Temperley London has long been a favourite amongst A-listers. Founded by namesake and creative director Alice Temperley, MBE, back in 2000, the luxury brand has stores in Mayfair, Notting Hill, Dubai, and Qatar.
Temperley London has kept its equity fundraisings quiet, completing 5 unannounced rounds to date. In total, the company has received £7.53m equity finance from unknown investors.
Despite being the Duchess of Cambridge’s ‘go-to boho designer’, the future of Temperley London now looks uncertain. News broke last month that Temperley received a £1.8m bailout, after posting a £2.8m loss.
The big hitter: Farfetch
London-based Farfetch is arguably the most successful UK equity-backed company in the fashion sector yet. The company has completed 7 fundraisings to date, amounting to a total investment of £219m. High profile backers include Conde Nast, DST Global, Vitruvian Partners, Index Ventures, and Greycroft Partners.
Farfetch is an e-commerce platform for independent fashion boutiques, as well as major brands.
Headed up by CEO José Neves, the company recently partnered with the British Fashion Council’s charitable initiative the Fashion Trust.
Virginie Morgan, deputy chief executive of Eurazeo – one of FarFetch’s backers in a £76m round last week – said: “We were enticed by the Farfetch model, which covers the sectors in which we have already gained a solid foothold – digital technology, luxury goods and brand names.”
Accel Partners has made 6 investments into fast-growing UK fashion companies. These amount to £57.3m, at an average investment size of £9.54m. On average, Accel Partners took a 31.4% equity stake in exchange for these investments.
Investee in focus: Lyst
London-based Lyst is a fashion shopping aggregator platform. Founded in 2010, the company ‘connects millions of shoppers globally with over 11,000 designers and stores’. Accel Partners has completed three rounds of undisclosed investment into Lyst – most recently contributing to a £28m round alongside Accel Partners, Balderton Capital, and Draper Esprit in April 2015.
Imperial Innovations has backed 3 equity fundraisings into UK fashion companies, totalling £1.83m. The fund’s average investment size into fashion companies is £916k.
Investee in focus: Cortexica
Hailed as ‘Shazam for clothes’, Cortexica is image recognition software that allows shoppers to visually search for clothes. The software apparently ‘mimics processes found in the brain’s visual cortex’, and was recently adopted by John Lewis.
Developed by Dr Anil Bharath and Dr Jeffrey Ng from the Department of Bioengineering at London University, the spinout has secured four investments from Imperial Innovations.
Index Ventures has completed 6 equity investments into UK fashion companies, amounting to £44.4m. The average investment size is £7.39m, in exchange for an average 29.1% equity stake.
Investee in focus: EDITD
London-based EDITD have brought ‘the power of data’ to fashion and apparel retail. The company has developed real-time market analysis tech, which allows brands to improve their understanding of customers and competitors. High profile clients include ASOS, Gap, Gilt Groupe, and Missguided.
“EDITS’s approach to retail analytics is unique”, says Robin Klein, partner at Index Ventures. “By analysing large amounts of data, much of it directly, from e-tailers and comments in social media, they can provide unequalled insights that save their clients large sums and increase their sales”.
Index Ventures co-invested £3m into EDITD alongside Frog Capital in 2014.
Is the money there?
In 2015, we saw 60 equity fundraisings into UK fashion companies. This was more than twice the number recorded in 2013, and a 13% increase on 2014 figures.
|No. of fundraisings
|Total amount invested
Total investment in 2015 amounted to £113m; almost four times the total recorded in 2013, and a 13% growth rate on 2014 figures.
So far this year, we’ve seen £82.5m invested across 9 fundraisings within the fashion sector. Excluding the outlier £76m investment into FarFetch, however, these figures don’t paint a particularly encouraging picture. Judging by the sector’s performance so far, 2016 has its work cut out if it’s to equal 2015’s growth.
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