Five years after becoming Lithuania's first tech unicorn, the second-hand marketplace Vinted can now claim a fifth horn. The company, based in Vilnius, recently announced on that it has been valued at 5 billion euros, as part of a secondary sale of shares by existing shareholders totalling 340 million euros.

The shares were sold to new investors, with the deal being led by Texas based alternative asset manager TPG. Other investment funds such as Hedosophia from London, Baillie Gifford from Scotland, as well as Invus Opportunities, FJ Labs, Manhattan Venture Partners and Moore Strategic Ventures from New York also participated. Vinted was previously valued at 3.5 billion euros in a financing round in 2021.

Vinted, founded in 2008 and known in Germany under the name Kleiderkreisel in its early years, is now the largest European online platform for trading second-hand clothing, accessories and other products. The company is currently active in 20 countries and was in the black for the first time last year – with around 77 million euros in adjusted EBITDA, and a net profit of around 18 million euros.

Unlike the Berlin-based online fashion retailer Zalando, which experienced a significant slowdown in growth in 2022, following the coronavirus sales boom, and didn't get off the ground in the following year either, Vinted's sales have been steadily rising. In 2022, they increased by around half, and in 2023 by 60% to 596 million euros.

The flea market app operator already has its sights set on the next phase of growth – and CEO Thomas Plantenga believes that the experience of the new investors will be needed for this. The Dutchman, and former founder of a software company specialising in boat rentals, joined the company in 2016, after it was on the verge of bankruptcy due to a lack of revenue, and exploding costs.

He himself later described his rescue plan for Vinted as „aggressive“ in interviews: offices in San Francisco, London, Munich and Paris were closed, and almost half of the 240 employees had to leave. Instead of a seller's fee, which had scared off many users after its introduction in Germany, Vinted now opted for a significantly lower fee for buyers. The plan worked and users returned. Today, Vinted employs more than 2,000 people.

The company's vision has always been the same, says Plantenga: To make second-hand the first choice worldwide. The topic is becoming increasingly popular due to growing environmental awareness, but also because of the prospect of lower prices. According to a PwC study, the volume of the second-hand fashion market in Germany is expected to grow from 3.5 billion euros in 2022 to 5 to 6 billion euros by 2025. According to the study, around one in two consumers has already bought second-hand clothing. Among the younger Gen Z, the proportion is 64%.

The interest in the flea market economy has not gone unnoticed by companies such as Zalando, which also introduced a so-called „pre-owned“ offer for trading in used fashion in 2020. At H&M, the concept is called „Pre-loved“ and has been available in Germany since 2022. Zara has been offering a „pre-owned“ model in Germany since the end of 2023.

Vinted does not want to stop at fashion alone – probably also due to increasing competition. In future, growth will also be fuelled by other product categories such as consumer electronics. In an interview with the „Financial Times“, Plantenga also talked about books, toys and video games. A verification service for designer and luxury fashion items, where buyers can have their goods checked for authenticity by experts for a fee of 10 euros, is to serve as a further source of income. In 2022, Vinted acquired Rebelle, a Hamburg-based specialist for second-hand luxury fashion that was listed on the stock exchange at the time, to pursue its ambitions in the designer goods business and merged the two platforms.

Vinted also wants to rely on its mail order and payment business and expand its regional focus in future, according to Plantenga. The company is still mainly active in Europe, said the CEO. In the long term, however, the aim is to become a global company. In this respect, expansion into the USA could also be considered.

In the shorter term, the company expects growth to continue. This year and next, turnover and profits are likely to increase further, said Plantenga. The company has also been considering an IPO for some time, although there is currently no immediate pressure.

However, venture capitalists are likely to put pressure on the company sooner or later, and look for opportunities for an exit. Among them is the start-up investor Burda Principal Investments, part of the Munich-based media company Burda, that has already invested money in Vinted on several occasions.

Zalando, for its part, went public ten years ago. In the wake of the coronavirus-induced online boom, the share price more than tripled between spring 2020 and mid-2021, temporarily reaching over 100 euros. Today, there is nothing left of the price gains – the shares recently traded at around 29 euros. The group currently weighs in at around 7.6 billion euros. Its market capitalisation is therefore not very far ahead of the Vinted valuation.