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After going public in 2021, US resale marketplace Poshmark will be acquired by Korean e-commerce company Naver, the companies announced on Monday.
At $17.90 per share, Poshmark’s sale price has an enterprise value of $1.2 billion. When the peer-to-peer e-commerce platform debuted on Nasdaq in January last year, it was valued at $7.5 billion.
Poshmark went public during a resale boom that saw other key players including Thredup file for IPOs. Sneaker resale market StockX was rumored to be exploring an IPO earlier this year. However, profitability has proven difficult for resale companies, who have to grapple with unpredictable supply and demand. Poshmark’s share price has fallen 82 percent since its IPO. In August, the company reported Q2 adjusted EBITDA loss of $9.8 million for the second quarter of 2022.
Naver CEO Choi Soo-Yeon noted the concerns about Poshmark’s short-term profitability, but said he has high expectations for its mid- and long-term growth. The Korean company will use Poshmark to enter the global peer-to-peer resale market. The deal is expected to close in the first quarter of 2023.
Poshmark founder and CEO Manish Chandra told investors and press that the depth of Naver’s technology presence was the primary draw for the resale platform, particularly live shopping and AI possibilities. Chandra will stay on as CEO post-acquisition, and Poshmark will keep running with its current business model.
Poshmark’s millennial and Gen Z consumer base was a draw for Naver, particularly in light of the growth of the secondhand market. Eighty percent of Poshmark’s approximately 40 million annual users fall under this demographic, according to the company. “Naver’s leading technology in search, AI recommendation and e-commerce tools will help power the next phase of Poshmark’s global growth,” Soo-Yeon said in a statement, adding that circular commerce including resale is gaining popularity in Korea.
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