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StockX — a fast-growing Web destination for traders of hard-to-find sneakers — is looking for a whopping $2.5 billion valuation as it prepares for a fresh round of private funding, The Post has learned.
Sources estimate that the Detroit-based company is looking to raise $250 million to fuel a new leg of growth for its site, which assigns ticker symbols to sneakers in a scrolling feed that displays bids, offers and green-and-red arrows to show whether prices are up or down.
The proposed valuation is more than double what StockX rang up in June 2019, when investors valued the company at $1 billion as they handed it more than $100 million in proceeds. The upcoming round is expected to be the last private fundraising before an anticipated initial public offering in mid-2021, according to sources close to the situation.
The company has yet to create a pitch book for the upcoming fundraising but has contacted existing investors in recent weeks to gauge their interest, sources said.
In addition to the backing of investment firms like Google Ventures and General Atlantic, StockX has boasted celebrity investors that include Eminem, Mark Wahlberg and Karlie Kloss. Dan Gilbert, the billionaire founder of Quicken Loans and owner of the Cleveland Cavaliers, is among StockX’s co-founders.
StockX didn’t immediately return a request for comment.
The Detroit-area company reportedly charges a commission ranging between 9 and 14 percent for pricey shoes such as Nike Air Jordans and Adidas Yeezys. The fees can rise quickly given the increasingly lofty prices of rare sneakers.
On Monday, a pair of four-year-old Nike Air Force 1 Craig Sagers — decorated with paisleys and blue, metallic swooshes — drew a bid of $4,300. The seller was still holding out for $5,000.
StockX got a boost this year from COVID-19 as lockdowns have shuttered traditional sneaker outlets. Last week, Forbes reported that StockX’s business surged 500 percent from a year earlier during the third quarter.
In a pitch to investors for a round completed earlier this year, StockX said it expects to handle 7 million trades this year worth a combined $1.7 billion, with an average order size of $234.
In the pitch, it forecasted a gross profit of $141 million for 2020 on $350 million in revenue — up from gross profit of $65 million on $239 million in revenue last year. Nevertheless, the site expected $56 million in operating losses for the current year as it spends heavily to build out its brand and infrastructure.
The company recently opened three new “authentication centers,” where sellers ship their goods to be inspected before they’re delivered to buyers. One of them is located in Hong Kong as StockX eyes an expansion into lucrative Asian markets.
“We’ve had more and more traffic and buyers coming to our site because in some respects, traditional retail in some geographies is not available,” Chief Executive Scott Cutler, a former executive at eBay and Stubhub, told TechCrunch. “We thought we’ve always been a marketplace of scarcity, but now you can’t actually go into a real retail location, so you’re coming to StockX.”
StockX has branded itself the “stock market of things” as it looks to sell an expanding assortment of sought-after, tradeable goods including watches, handbags, streetwear, baseball cards and most recently the hard-to-get PlayStation and Xbox gaming consoles.
A recent report by Cowen Equity Research pegged the global sneaker resale market at $6 billion and predicted it will be worth $30 billion by 2030.
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