In a striking move, Vinted, Europe’s leading online marketplace for second-hand clothing, has announced its decision to postpone plans for an initial public offering (IPO). The Vilnius, Lithuania-based company, now valued at €5 billion ($5.29 billion) following a successful secondary share sale led by TPG, has chosen instead to focus on expanding its operations into new markets and product categories.
During an interview at the recent Web Summit in Lisbon, Vinted CEO Thomas Plantenga emphasized the strategic decision to maintain a smaller group of investors as opposed to managing a vast shareholder base. “It’s easier to deal with five or six investors than to have to appease a large shareholder base,” Plantenga stated, highlighting the importance of flexibility in growth and investment strategies.
Expanding Beyond Fashion
Vinted is not merely resting on its laurels. The company has ambitious plans to diversify its offerings beyond clothing into various other second-hand markets, including electronics, toys, gaming consoles, and potentially luxury watches. Plantenga remarked, “We’re expanding into new countries and we’re expanding our categories. We’re taking a ton of risk,” signaling Vinted’s commitment to growth through innovative avenues.
This expansion strategy is rooted in a clear vision: to create a marketplace that transcends existing online platforms by minimizing friction and cost barriers for users. “If you look at second-hand trading platforms, they’ve been there for decades. What we’re trying to do is to create a market that’s much bigger than anything that’s online,” Plantenga explained, underscoring his focus on enhancing user experience through improved shipping, payment efficiencies, and rigorous product verification services.
The Path from Near Bankruptcy to Profitability
Vinted’s journey has not always been smooth. Co-founded in 2008 by Milda Mitkute and Justas Janauskas, the company initially stemmed from a simple personal need: Mitkute’s desire to sell her used clothes amid a house move. By 2016, when Plantenga joined as a consultant, Vinted was teetering on the brink of bankruptcy, reportedly burning more than a million euros a month with only nine to twelve months of financial runway.
After becoming CEO in 2017, Plantenga implemented significant operational changes that included centralizing technology and closing several European offices. These strategic moves not only brought Vinted back from the brink but also positioned it as Lithuania’s first unicorn—a startup valued at over $1 billion. By 2023, Vinted reported its first annual profit, with sales soaring by 61% to a remarkable €596.3 million.
Future Outlook
As Vinted continues to thrive, its CEO remains optimistic about maintaining profitability in the coming years. This positive outlook is supported by the company’s strategic entry into new markets, including Denmark and Finland, and a budding venture into luxury fashion.
Despite receiving soft interest from potential acquirers, Plantenga remains steadfast in his focus on Vinted’s growth trajectory. “When you’re on a rocket ship, you’re not thinking about exiting,” he noted, indicating that for now, his priority is firmly on building the company’s potential rather than entertaining acquisition offers.
Conclusion
Vinted’s decision to delay an IPO represents a calculated choice to prioritize growth and expansion over immediate financial gains through public investment. By venturing into new product domains and enhancing customer experience, Vinted aims to elevate its standing in the second-hand marketplace and solidify its profitability.
Vinted’s journey and strategic decisions offer valuable lessons for entrepreneurs in various sectors. The focus on sustained growth over short-term financial maneuvers can provide a foundation for long-lasting success.
