Vinted thrives as shoppers turn to second-hand fashion

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by Jacob Solomon Nov 28, 2022 News
Vinted thrives as shoppers turn to second-hand fashion

For a long time,Lithuania looked on enviously as start-ups such asSkype and Wise developed links to the northernmost Baltic country.

The southernmost Baltic state has had a lot to cheer about recently thanks to the online marketplace for second-hand fashion. In May 2021, the company was worth 3.5 billion, making it the first billion-dollar company in the country.

Europe's largest app for buying and selling used clothes is called Vinted. Canada and the US are next on the list of countries it has conquered over the past 10 years.

The company makes second-hand fashion the first choice in the midst of the cost of living crisis. One of the few start-ups still hiring is Vinted.

Thomas Plantenga said that second-hand is still a drop in the ocean. According to research, second-hand fashion makes up just 4% of the total apparel market.

A shopper in Belgium consults the Vinted app
Old clothes, new business: a shopper in Belgium consults the Vinted app © BELGA MAG/AFP via Getty Images

Depop in the UK and general marketplaces such as Ebay are some of the direct competitors that Vinted must compete against. Shoppers are buying new clothes, according to Plantenga.

The market is being developed by everyone. There is a lot of space. The challenge is to convert people to a mindset of looking at second-hand before looking at new.

A way for local women to swap clothes was founded in 2008 by Milda Mitkut and Justasjanas. The website with no marketing budget became one of the top 20 in terms of traffic inLithuania, thanks to the attention of local programmers.

He pitched a plan to expand to Poland and Germany using their personal savings. The willingness to look outside a start-up's home country early on is something venture capitalists appreciate.

She says that Europeans have to prepare themselves to go global from the beginning. It is necessary to prepare your regulatory structure to migrate into other markets if you are coming from a country like Finn orLithuania.

After a detailed investigation into whether investing inLithuania made sense, US venture capital firm Accel became the first outside investor in Vinted. The map ofLithuania has been put on it.

There used to be a stigma to used clothes. But, for younger generations, the last thing they care about is if something is new

Carolina Brochado, EQT Growth

Other start-ups have followed Vinted's lead, includingNord Security, a virtual private network provider that becameLithuania's second unicorns. All were funded from personal savings and not from outside investors.

After a small hiccup in 2016, Vinted went from strength to strength. Most of the users are female and between the ages of 18 and 39. As of last month, it had launched in Slovakia, Hungary and Sweden.

There was a 65 per cent increase in revenue in the year. They increased by 37 per cent in the first nine months of the year.

Plantenga says that most of us are in a situation where we need to be more careful with our money. The company is looking to add hundreds of people this year and next year, according to the CEO.

The shipping business was separated from the marketplace by Vinted. It is trialling a pan- European network of lockers in France to make shipping more sustainable for customers.

A woman in France will pick up your clothes if you put them in a locker in the Netherlands. Shipping services are sold by Vinted, which can connect companies across the continent. A board games maker is one of the customers.

The company is taking a more cautious approach to expansion outside Europe. While the US and Canada are different, the runway to success is longer in Europe. Safety issues, shipping, and currency are some of the challenges.

As the cost of acquiring new customers keeps falling, there is no rush to go for a stock market listing. She says it's a powerful funnel.

Vinted is interested in acquiring something. Rebelle, a Swedish online marketplace for luxury fashion, was taken over by it in August. That is a departure from the current focus of Vinted.

To move into higher-end fashion and to improve Vinted's trust and safety performance are two main reasons for the deal.

Even in an economic downturn, there's a lot of potential for Vinted to grow. Used clothes used to be stigmatized. Younger generations don't care if something is new. They care about waste and flexibility. The power of the closet is unlocked by Vinted.