business

Poshmark more than doubles its value in blockbuster Nasdaq debut

Shares of Poshmark soared more than 130 percent in their stock market debut on Thursday, valuing the online fashion marketplace at $7.15 billion, highlighting investor optimism for online shopping that has surged during the COVID-19 pandemic.

Shares opened at $97.50 on the Nasdaq, well above the initial public offering (IPO) price of $42 apiece. The company raised $277.2 million in its IPO on Wednesday.

Poshmark, whose board members include the likes of tennis legend Serena Williams, has debuted in a week that could be the biggest for new listings in more than five years as companies seek to make the most of the strongest IPO market in two decades.

Poshmark’s investors include Hollywood actor Ashton Kutcher, celebrity stylist-turned-designer Rachel Zoe, investment firm SV Angel and venture capital firm GGV Capital, which was also an early backer of Chinese e-commerce giant Alibaba.

Founded in 2011 by four entrepreneurs, including Chief Executive Officer Manish Chandra, Poshmark reported a net income of $20.9 million in the first nine months of 2020, compared to a net loss of $33.9 million in the same period in 2019.

The company is an online marketplace for individuals to sell clothes and accessories ranging from pre-owned T-shirts to high-end boutique dresses and private labels, allowing shoppers to bid on the merchandise.

Poshmark, which has 70 million registered users across the United States and Canada, has attributed its turnaround to increased demand for goods sold on its platform and a fall in marketing spend during the pandemic.

Morgan Stanley, Goldman Sachs and Barclays are the lead underwriters for Poshmark’s offering.

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