The RealReal Inc. is all about pricing things — finding that gem of a look in someone’s closet, determining its value and then efficiently using it platform to connect with a buyer.
Now, the company has priced itself for an initial public offering and come up with a big number — $1.5 billion.
That’s at the midprice of the offering, which is expected to be priced at $17 to $19 a share, according to a filing with the Securities and Exchange Commission Monday.
Investors have grown suddenly keen on fashion, welcoming Farfetch, Levi Strauss & Co. and Revolve to the markets.
If The RealReal gets it’s price of $1.5 billion, it would start out with an enterprise value of 7.2-times its annual revenues of $207.4 million. (The quickly growing firm, which is carrying $8 million in debt, has been operating at a loss with red ink of $84.7 million last year).
By comparison, Revolve, with an enterprise value of $2.9 billion, is trading at 5.5-times Revenues. The RealReal would also get a better valuation on the sales of used luxury looks than some of the original producers. Gucci-parent Kerning trades at an enterprise value-to-revenue-multiple of 4.6-times while LVMH Moët Hennessy Louis Vuitton sits at 4-times.
The measuring
RealReal Targeting $1.5 Billion IPO Valuation
Image Courtesy of JOSHUA SCOTT
