You are hereNordstrom Acquires Flash Sales Site HauteLook For $270 Million
Nordstrom Acquires Flash Sales Site HauteLook For $270 Million
In one of the larger exits so far in the flash sales business, retail chain Nordstrom has acquired flash sales site HauteLookfor $180 million in Nordstrom stock and three-year earn-out of up to $90 million. HauteLook has raised $41 million in funding.
Thanks to the immense popularity of members-only, online sample sales, HauteLook has grown to 4 million members since launching in 2007. The site offers massively discounted sale events in women’s fashion, men’s fashion, accessories, kids’ clothing and toys, travel and home and beauty.
The basic idea behind the flash sales model is this: designers ad retailers, such as Marc Jacobs or Versace, place excess inventory on a sale site at 50 to 70 percent discounts over a several day period. The sales are private, available only to members, with upcoming sales from brands announced via emails. You can get invites from other members or request invites via the site.
The flash sales space is definitely competitive; and the amount that HauteLook sold for isn’t entirely surprising. Two years ago GSI Commerce bought RueLaLa in a deal valued at $350 million. Gilt Groupe, has been raising huge amounts of money, growing its user base at a rapid pace and turning a strong profit. In December, Gilt raised another $15 million, bringing the company’s total funding to nearly $100 million. At one point Gilt was valued at $400 million but that number has surely increased over the past year. And an IPO could be in the near future.
One Kings Lane, has also recently raised a large amount of money and is growing like a weed. And there are a number of independent players like Ideeli, BeyondTheRack and others who are still growing at a fast clip.
The concept has even attracted retail giants like eBay, Saks and Neiman Marcus, which are now jumping on the bandwagon to offer their own private sales, a market which Nordstrom clearly wants to enter the space. I wouldn’t be surprised if other larger retailers snap up niche, smaller flash sales sites over the next few years.
CrunchBase InformationHauteLookInformation provided by CrunchBase
Flash sales site Ideeli, which was founded in 2007, has raised $41 million in Series C funding led by Next World Capital with Cue Ball Capital, StarVest Partners, Constellation Growth Capital and Kodiak Venture Partner participating in the round. This bring’s Ideeli’s total funding to nearly $70 million
Beyond the Rack, a members-only sample sale site, has raised another round of funding today. The startup has just announced a $12 million round of funding from Highland Capital Partners and BDC Venture Capital. This brings the Beyond The Rack’s total funding to $16.5 million.
Vente-Privee, the European flash sales giant, has announced a joint venture with American Express to bring the site to the U.S.
It’s no secret we’re big fans of One Kings Lane, a Kleiner Perkins and Greylock-backed flash sales site for home décor, furnishings and accessories. Today, the e-commerce startup is launching a new feature called Downstairs, which will give the site’s members deeper discounts on a selection of items; with prices up to 80 percent off retail.
Flash sales have proven to be a valuable place to find a deal on almost anything; from clothing to travel to home goods to wine. But with growing number of flash sales sites out there, it can be overwhelming to track every sale each day via individual emails. Splendora’s SalesCast iPhone app aggregates over 20 sales into one free app.
It looks like you’ll soon be able to shop for cars on flash sales sites. Gilt Groupe has just announced a first-ever auto flash sale of a Volkswagen Jetta on the site.