Novel Group-backed luxury goods marketplace The RealReal will raise $300m in an initial public offering in which it will float above its range.
The RealReal, a US-based second-hand luxury items reseller backed by telecommunications firm Novel Group, raised $300m in its initial public offering yesterday, issuing 15 million shares priced at $20 each.
The company had targeted a range of $17 to $19 for its shares. It will begin trading on the Nasdaq Global Select Market today, with chief executive Julie Wainwright set to ring the stock exchange’s opening bell. The offering values it at about $1.65bn.
Founded in 2011, The RealReal operates an e-commerce platform where users can sell and purchase pre-owned luxury consumer goods such as handbags, apparel, jewellery, art and furniture.
The company employs more than 100 art curators and other experts who verify each item before it is listed on the platform. It also maintains three brick-and-mortar locations across New York and Los Angeles.
The IPO proceeds will primarily go toward general corporate purposes, but TheRealReal will also allocate 1% to fund a charitable arm, The RealReal Foundation. A total of $300,000 will go towards paying down an existing loan.
The RealReal had secured approximately $335m in venture funding ahead of its initial public offering.
Novel TMT Ventures, the corporate venturing representative of Novel Group, participated in the company’s $14m series B round in 2013, alongside Greycroft, Canaan Partners, E.Ventures, Panarea Capital and assorted private investors.
The company’s investors also include PWP Growth Equity – part of asset management firm Perella Weinberg Partners – Great Hill Partners, GreenSpring Associates, Sandbridge Capital, InterWest Partners, DBL Partners, Broadway Angels, NextEquity Partners, Springboard Fund and Industry Ventures.
Great Hill Partners remains The RealReal’s largest shareholder, seeing its stake diluted from 14.7% to 12%. Its other notable investors are Canaan (10.6% post-IPO), PWP Growth Equity (9%), InterWest Partners (8.1%), Greycroft (7.4%), E.Ventures (6.6%) and Greenspring (6.1%).
Credit Suisse Securities (USA), BofA Securities and UBS Securities are lead book-running managers for the IPO while KeyBanc Capital Markets and Stifel Nicolaus are book-running managers. Cowen and Company and Raymond James & Associates are co-managers.
The underwriters have a 30-day option to purchase up to an additional 2.25 million shares to take the its size to $345m.