ThredUp’s shares pop in stock market debut

NEW YORK (AP) — Shares of ThredUp rose more than 40 per cent in their stock market debut on Friday, reflecting investor enthusiasm for the online seller of second-hand women’s and children’s clothing.

The stock market debut followed strong investor enthusiasm for Poshmark Inc, whose stock more than doubled to USD101.50 valuing the company at USD7.4 billion in its showing on January 14. However, Poshmark’s shares have come down more than 60 per cent since then.

Late Thursday, ThredUp’s initial public offering of 12 million shares was priced at USD14 apiece, the high end of its estimated range of USD12 to USD14, according to a company statement. That raised about USD168 million before underwriting fees.

The shares, opened at USD18.25 late Friday morning on the Nasdaq Global Select Market under the symbol ‘TDUP’. Shares closed at USD20, giving the company a valuation of roughly USD1.85 billion.

“I am thrilled with how the stock is being received, but it’s just one day and we have great years of opportunity in front of us,” said co-founder and Chief Executive Officer (CEO) of ThredUp James Reinhart during an interview with The Associated Press on Friday.

Reinhart said that the proceeds from the initial public offering will be used to invest in software at its facilities, while expanding beyond the United States (US) to possibly Europe.

ThredUp’s debut comes as the resale market has remained resilient even during the pandemic, benefitting from shoppers’ accelerated shift online and customers’ steadfast focus on second-hand goods as they become more conscious about the environment. The total resale market reached USD28 billion in 2019 and should increase to USD64 billion by 2024, according to research from GlobalData commissioned by ThredUp.

Hundreds of thousands of garments are stored on a tri-tiered conveyor system at the ThredUp sorting facility in Phoenix. PHOTO: AP