IPOs: Waiting for a Tech Unicorn
Just over a decade ago, investors with a penchant for luxury goods were reeling over the slew of IPOs that rocked the markets – family-run businesses like Salvatore Ferragamo and Prada among them, following in the steps of Bulgari and Tod’s.
That all changed after the financial crisis. Today, trade woes, weak EU banks, Italy’s bad debt crisis, and political malaise continue to toss cold water on any hope of renewing the IPO fever that once riled Milan’s FTSE Mib and Paris’ CAC Indexes.
For analysts, the real problem isn’t the banks and it’s not the looming threat of yet another recession or the trade crisis, it’s the dearth of tech and online companies that have what it takes to survive the headwinds ahead.
“I guess one reason is that quite a number of these IPOs are at the intersection of technology and the internet, where Europe is two or three steps behind the USA. European IPOs are still ‘old economy’ in luxury goods on this side of the ocean… like Watches of Switzerland, for example,” said Luca Solca, Senior Research Analyst, Luxury Goods at Bernstein.
By comparison, in the US, markets are still reeling from digital commerce IPOs that soared on their market debuts in 2018 and earlier this year.
Secondhand luxury retailer the RealReal, which debuted on Nasdaq this summer, raised $300 million and surged 50% on opening day. London-based Farfetch, which recently listed on the New York Stock Exchange, hit a valuation of about $6.2 billion. On a side note, Farfetch is facing multiple class-action lawsuits alleging it had misled investors during its IPO. Levi Strauss & Co., Kontoor Brands, and Revolve Group all joined the public markets over the past year. JCrew’s savvy Madewell unit is also the next market hopeful.
According to financial market platform Dealogic, 2018 was, without doubt, a tough year for Europe. “A range of macroeconomic uncertainties affected both investors’ and corporates’ sentiment. EMEA IPO levels dropped 97% to $475 million in proceeds and 65% to 22 IPOs in activity compared to the same period last year.”
Macroeconomic factors will continue to impact IPOs across the board over the next year, said Dealogic in a note published earlier this year.
In Europe, there are some small glimmers of hope. Vestiaire Collective, a Paris-based social commerce platform, recently completed a 40 million euro round of financing led by Bpifrance and Chief Executive Max Bittner, as the company focuses on enhancing its tech features, as well as the Asia and Middle Eastern expansions. There has been no real talk of an IPO, at this stage. In Italy, the situation is lacklustre at best. IPOs on the horizon are smaller in terms of scale. Accessible luxury brand Elisabetta Franchi is shooting to list in early 2020 on the AIM segment for small caps of the Italian Stock Exchange. Missoni, whose Vice President Michele Norsa was a crucial figure in the listings of the Valentino Fashion Group and Salvatore Ferragamo, told WWD earlier this year, the company might list in 2023. Missoni, which booked 150 million euros in revenues last year, sold 41.2 percent stake to FSI Midmarket Growth Equity Fund for 70 million euros in 2018 to fuel its expansion.
As the gap between the worlds of science, tech, and fashion continues to narrow, some smaller players might emerge onto the international scene over the next decade, investors say.
“I think that creating a successful company is just hard. Maybe today it is easier to start one, but this creates much more competition on the market, so only the strongest survive,” said Fashion Technology Accelerator CEO Giusy Cannone, who added the next companies to make an impact are those invested in artificial intelligence, smart information, GEO price monitoring, merchandising optimization, customer behavior analysis, and those invested in data supporting creative processes. “It all boils down to  market entry. Some innovations come to market too early and the market is not necessarily ready to accept them yet. Look at the rental market for instance: in the US, Rent the Runaway has become a unicorn; in Europe the rental market is still very very small with no dominant players yet,” Cannone said.
SHARE
  • Facebook
  • Twitter
  • Pinterest
SIMILAR ARTICLES
On A Quest for Young Italian Talents
By Elisa Carassai
Fashion has been used, since forever, as a means of escapism, a way of transporting insiders and...
By Elisa Carassai
Fashion has been used, since forever, as a means of escapism, a way of transporting insiders and non to faraway lands full of beauty and creativity. From the creations of John Galliano at Dior to Alexander McQueen’s own eclectic work of arts, fashion visionaries used to bridge the gap between...
Fashion has been used, since forever, as a means of escapism, a way of transporting insiders and non to faraway lands full of beauty and creativity. From the creations of John Galliano at Dior to Alexander McQueen’s own eclectic work of arts, fashion visionaries used to bridge the gap between fashion and the arts.As the world steered in a different direction, so did the market – and the...
Celebrating Belgian Fashion
By Elisabeta Tudor
For its 4th edition, the Belgian Fashion Awards celebrated the movers and shakers of Belgian...
By Elisabeta Tudor
By Elisabeta Tudor
For its 4th edition, the Belgian Fashion Awards celebrated the movers and shakers of Belgian fashion in Antwerp during a one-day Fashion Talks event, which culminated in an awards ceremony.Organized by the Flanders District of Creativity (Flanders DC), the event is part of the non-profit...
For its 4th edition, the Belgian Fashion Awards celebrated the movers and shakers of Belgian fashion in Antwerp during a one-day Fashion Talks event, which culminated in an awards ceremony.Organized by the Flanders District of Creativity (Flanders DC), the event is part of the non-profit organization's aim to serve as a springboard for entrepreneurs in the creative industries in Flanders. In...
Quoi Alexander: A Designer on a UN Mission
By Jessica Bumpus
Fashion and AI may be having a moment, but for designer Quoi Alexander returning to the original...
By Jessica Bumpus
Fashion and AI may be having a moment, but for designer Quoi Alexander returning to the original textile technology, sewing, is what he’s most fascinated by right now. “It’s something I’ve embraced. This Spring/Summer 2020 season is the first collection with it in!” said the now Paris-based...
Fashion and AI may be having a moment, but for designer Quoi Alexander returning to the original textile technology, sewing, is what he’s most fascinated by right now. “It’s something I’ve embraced. This Spring/Summer 2020 season is the first collection with it in!” said the now Paris-based Central Saint Martins alum, who, ever since the launch of his own label, has been reinventing the wheel...
Italy’s Fashion Chamber Cracks Down on “Gifts”
By Elisa Carassai
MILAN-- The ubiquity of influencers who have garnered fame on borrowed wardrobes is, these days,...
By Elisa Carassai
MILAN-- The ubiquity of influencers who have garnered fame on borrowed wardrobes is, these days, a reality, while self-made icons – like Lee Radziwill or Jane Birkin – are sadly a thing of the past.As the fashion sector struggles to define what an influencer actually is, organisations like the...
MILAN-- The ubiquity of influencers who have garnered fame on borrowed wardrobes is, these days, a reality, while self-made icons – like Lee Radziwill or Jane Birkin – are sadly a thing of the past.As the fashion sector struggles to define what an influencer actually is, organisations like the Federal Trade Commission in the United States are cracking down on false influencer advertising. In...
3D Fur is as Good as it Gets
By Sofia Celeste
Researchers at MIT have created 3D-printed fur that is perfect for wintery couture runway looks,...
By Sofia Celeste
By Sofia Celeste
Researchers at MIT have created 3D-printed fur that is perfect for wintery couture runway looks, elaborate paint brushes, or even jewellery, the university’s Media Lab said last week on its blog.The invention is a timely one, as California became the first US state last month to place a ban on...
Researchers at MIT have created 3D-printed fur that is perfect for wintery couture runway looks, elaborate paint brushes, or even jewellery, the university’s Media Lab said last week on its blog.The invention is a timely one, as California became the first US state last month to place a ban on selling, donating, or manufacturing new fur products in the state.Over the last few years, vanguard...
This Way Forward
By Elisabeta Tudor
Caterina Occhio is a woman of many talents. A former development aid expert for the European...
By Elisabeta Tudor
By Elisabeta Tudor
Caterina Occhio is a woman of many talents. A former development aid expert for the European Commission and the United Nations, Caterina is now a full-fledged social entrepreneur who made her mark in the fashion industry by creating and contributing to women empowering and sustainable projects....
Caterina Occhio is a woman of many talents. A former development aid expert for the European Commission and the United Nations, Caterina is now a full-fledged social entrepreneur who made her mark in the fashion industry by creating and contributing to women empowering and sustainable projects. She now has been appointed social sustainability advisor at Trussardi and just launched a brand-new...
OTB and Koché Ink Partnership
By NOWFASHION
MILAN—In an attempt to expand its portfolio of emerging talent and established brands, Renzo...
By NOWFASHION
MILAN—In an attempt to expand its portfolio of emerging talent and established brands, Renzo Rosso’s OTB has reached a license agreement between its production unit Staff International and French designer brand KOCHÉ, both companies announced on Instagram Tuesday.Designed by Christelle Kocher,...
MILAN—In an attempt to expand its portfolio of emerging talent and established brands, Renzo Rosso’s OTB has reached a license agreement between its production unit Staff International and French designer brand KOCHÉ, both companies announced on Instagram Tuesday.Designed by Christelle Kocher, Koché is the 2019 ANDAM Grand Prize winner and is known for its colorful, artsy renegade style. Koché...
In Fashion’s Shoes
By Frédéric Martin-Bernard
The Musée des Arts Décoratifs in Paris is hosting a brilliant exhibition on shoes from all around...
By Frédéric Martin-Bernard
By Frédéric Martin-Bernard
The Musée des Arts Décoratifs in Paris is hosting a brilliant exhibition on shoes from all around the world, from the Middle Ages until today.Footprint stickers gradually converging in the same direction – at the entrance to the MAD (Musée des Arts Décoratifs) in Paris, these stickers are perfect...
The Musée des Arts Décoratifs in Paris is hosting a brilliant exhibition on shoes from all around the world, from the Middle Ages until today.Footprint stickers gradually converging in the same direction – at the entrance to the MAD (Musée des Arts Décoratifs) in Paris, these stickers are perfect to guide the visitor to the museum’s latest exhibition, dedicated to footwear from all over the...