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China / Business

Startup Ycloset raises $50m in third round of funding

By Wang Zhuoqiong (China Daily) Updated: 2017-09-08 09:50

Clothing-sharing e-commerce firm Ycloset, also known as Yi23.net, this week raised $50 million in third round funding from Alibaba Group Holding Ltd, SB China Capital and Sequoia Capital.

Founded less than two years ago, the Beijing-based firm rents clothes to customers with no additional charge for delivery and cleaning. For example, a client can pay 499 yuan ($77) per month to change an unlimited number of items during that period.

How to keep clothing clean after each service is one of the major obstacles for Chinese consumers to overcome when compared with purchasing new items.

The firm has put the new funds into improving its online system and operations. Ycloset has also joined forces with Fornet China Ltd, the country's leading cleaning company, to provide washing and maintenance services.

Doris Ke, marketing director of Ycloset, said the company has set up its own cleaning operation in Beijing for the northern market and the new collaboration with Fornet will provide faster and cleaner clothes to customers in the country's eastern and southern markets.

A new storage facility in Shanghai, launched on Sept 1, will also quicken the delivery time to within one or two days after ordering.

"Customers don't want to wait for too long to get the clothes they like," Ke said.

The average price of the apparel brands working with Ycloset has been about 1,500 yuan.

These include affordable luxury labels such as Kenzo, Acne Studios, and Self-Portrait, as well as high-street brands such as Zara and Topshop, according to Ke.

They also have included some domestic designer items.

Apparel brands offered Ycloset their clothes for free. Ycloset has paid brands rentals or some costs of the cloth once they were purchased by consumers.

Ycloset updates the inventory by season and by trends. For example, Ycloset has recently put online the autumn season new clothing line to meet the needs for women during the season-change days when their closets often lack suitable clothes, Ke said.

"We have more than 5 million users so far and the number is growing," Ke said. More than 70 percent of their consumers are aged 22 to 35, and are college graduates who have worked for one to five years. Most of them have lived in first-and second-tier cities with incomes of 8,000 yuan to 20,000 yuan.

So far, the company is working on how to best match the consumers and their products through analyzing data about consumers and their favorite items.

wangzhuoqiong@chinadaily.com.cn

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