Eurazeo exits Farfetch with €90.4m proceeds

The disposal has resulted in net proceeds of €90.4m, corresponding to a multiple of 4.1x cash-on-cash and an IRR of around 38%.

This is the second portfolio exit for Eurazeo Growth after the sale of PeopleDoc, which was sold to Ultimate Software – a US-based provider of human capital management services. The sale fetched $300m and was closed in July 2018.

Eurazeo invested $20m in Farfetch in May 2016, leading a $110m series-F round for the company. Under Eurazeo's ownership, Farfetch further grew its business among luxury brands, and expanded its geographic footprint in China and other countries worldwide.

Previous funding
Farfetch raised $4.5m in a series-A funding round led by Advent Venture Partners in July 2010.

Two years later, the company received $18m in a series-B round led by Index Ventures, eVenture Capital Partners and existing investor Advent Venture.

Condé Nast led a $20m series-C round for the business in March 2013, which was followed by a $66m series-D round led by Vitruvian Partners in May 2014. Previous backers Condé Nast and Advent Venture also participated in the round, alongside new investors such as Chinese VC Ceyuan.

The company raised $86m in May 2015 in a series-E round led by DST Global, with participation from Condé Nast and Vitruvian. The round gave the company a valuation of around $1bn, according to press reports published at the time.

Subsequently, Eurazeo led a $110m series-F round for the company in May 2016. Previous investor Vitruvian took part in the round, alongside new shareholders IDG Capital Partners and Temasek Holdings. Eurazeo contributed $20m through its Eurazeo Growth fund. The funding was primarily used to support the business's international expansion, with a primary focus on the Asian market.

More recently, Chinese e-commerce giant JD.com invested $397m in Farfetch in June 2017. As part of the deal, JD.com founder and CEO Richard Liu took a seat on the company's board.

Farfetch was listed on the New York stock exchange in September 2018, with a valuation of $5.8bn, or $6.3bn when including employee share options. The IPO raised $885m for the company after the issue of 33.6 million new shares. Early investors in Farfetch, including Vitrurian and Advent Venture, sold up to 10.6 million shares.

Farfetch raised $250m via a private placement of convertible senior notes to Chinese investor Tencent and San Francisco-based investment firm Dragoneer in January 2020.

Company
Farfetch is an online marketplace that sells luxury clothing, accessories and beauty products from independent designer boutiques and global brands.

The company employs around 3,000 staff and its website is available in 11 languages across 190 countries.

Farfetch was founded in 2007 by Portuguese entrepreneur José Neves and is headquartered in London, with additional offices in Porto, Guimarães, Braga, Lisbon, New York, Los Angeles, Tokyo, Shanghai, Hong Kong, São Paulo and Dubai. 

The company generated revenues of $1bn in 2019, from $602m in 2018, but continues to record negative EBITDA.

People
Eurazeo Growth – Yann du Rusquec (partner).
Farfetch – José Neves (CEO).

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