SHEIN plans to sprint for IPO this year! Valuation shrinks and faces multiple crises

As a hot cross-border e-commerce unicorn, SHEIN 's every move has attracted widespread attention in the industry.

Recently, SHEIN , which has been repeatedly rumored to be going public , has been rumored to be going public again.

SHEIN plans to sprint IPO this year ! Revenue is expected to reach US$58.5 billion in 2025

According to industry media reports, Chinese fast fashion cross-border e-commerce SHEIN plans to go public later this year and is currently actively attracting investors.

In a recent report presented to investors, SHEIN executives said that by 2025, the company's annual revenue is expected to reach $58.5 billion, far exceeding the $22.7 billion in 2022. In 2025, SHEIN's total merchandise transaction volume is likely to reach $80.6 billion, an increase of 174% compared to 2022.

The report also shows that SHEIN has been profitable for four consecutive years, and its profit reached US$700 million in 2022 .

The platform's profit was $1.1 billion in 2021. It is expected that by 2025, SHEIN 's profit may reach $7.5 billion.

In January of this year , foreign media reported that SHEIN was negotiating US$3 billion in financing, but the company's valuation dropped from US$100 billion in April 2022 to US$64 billion .

According to Crunchbase's survey data, SHEIN has completed six rounds of financing to date.

The first round of financing was in 2013, when SHEIN received a US$5 million Series A investment from JAFCO Asia.

In 2015, SHEIN received a RMB 300 million Series B financing led by Jinglin and IDG, and its post-investment valuation reached RMB 1.5 billion.

Since 2018, SHEIN has basically raised funds once a year, and its valuation has also risen rapidly.

In July 2018, SHEIN received hundreds of millions of dollars in Series C investment from Sequoia Capital, Shunwei Capital and others , and its valuation rose to US$2.5 billion.

In December 2019, SHEIN received a Series D investment of more than US$500 million from Tiger Global Management and Sequoia Capital , and its valuation doubled to more than US$5 billion.

In August 2020, SHEIN received hundreds of millions of dollars in Series E financing ( the investor is unclear ), and its valuation reached US$15 billion.

In April 2022, SHEIN received US$1 billion in financing from General Atlantic, Tiger Global Management, Sequoia China, and Shunwei Capital , with a valuation of US$100 billion.

However , in January this year, SHEIN 's valuation dropped to US$64 billion , which inevitably makes people wonder why the valuation dropped so quickly in less than a year.

In fact, behind SHEIN's rapid development, there are still many problems.

In the past three years , SHEIN has faced at least 50 lawsuits in the United States , accusing it of infringing the plaintiffs' intellectual property rights. On the other hand, overseas environmentalists have accused SHEIN of products not meeting environmental standards.

At the same time, SHEIN was also accused of serious waste of resources. SHEIN 's production model was accused by the outside world of being too wasteful and not conducive to sustainable development.

In addition to the above problems, the media previously broke the news that the workers in the SHEIN factory have increased their working hours to 75 hours per week. In addition, the workers' wages are very low, only 4 euro cents per piece. Bank of America analyzed that the various problems of SHEIN may lead to the US government issuing relevant bans. In the future development of SHEIN , it may face stricter supervision and review.

Is the rumor about SHEIN's IPO plan true? It is not known at present, and SHEIN has not responded yet.

However, behind its rapid development, SHEIN faces many questions such as environmental, social and corporate governance (ESG), which may become obstacles to its listing.

SHEIN has a new move! It starts recruiting third-party sellers in the United States

Under the influence of continued external risks , SHEIN began to seek new ways out.

According to the latest news from MarketPlacePulse, SHEIN plans to allow third-party sellers to settle in the United States, and the main target of recruitment is Chinese sellers.

Allowing third-party sellers to enter the U.S. market has become an important step for SHEIN to become a platform.

Previously, SHEIN has launched a platform model in Brazil and Mexico to test the waters, allowing other brands and retailers to sell on its platform.

In the second half of 2022, SHEIN will pilot a platform model in Brazil . Merchants who successfully join the platform can open stores on the SHEIN platform and be responsible for their own operations and logistics.

Earlier this year, SHEIN officially opened its platform to sellers from Mexico.

The launch of the platform model is of great significance to SHEIN. It means that in the future SHEIN will transform into an e-commerce platform model , and its main competitors will become e-commerce giants such as Amazon and AliExpress.

Moreover, with the addition of local third-party sellers, SHEIN's product range can not only be expanded, but the delivery time of platform products can also be shortened accordingly. And these local sellers are very familiar with local consumer demand, which can effectively enhance the user stickiness of the SHEIN platform.

It is understood that SHEIN has established a team of more than a dozen people in Brazil to develop its platform model. At the same time, SHEIN is also recruiting "business hunters" in the Brazilian and Mexican markets. It is understood that the main job of this position is to collect information about target customers and then recruit new sellers to join the SHEIN platform.

This time, SHEIN did not invite American sellers to open third-party sellers in the US market, and the main recruitment target is still Chinese sellers.

The main reason is that Chinese sellers are easier to recruit than local sellers. And SHEIN is considering the current market trends, so it pays more attention to recruiting Chinese sellers.

However, if SHEIN's platform model goes smoothly in Brazil and Mexico, the recruitment of local US sellers and the platformization of more markets may also be put on the agenda.

In addition to launching the platform model, SHEIN is also working hard to expand its market size, while also continuously adding more categories and comprehensively evolving its supply chain.

Initially, SHEIN mainly dealt in women's clothing, but also provided men's clothing, children's clothing, accessories, shoes, bags and other fashion products. Currently, SHEIN has expanded its product line to categories such as home furnishings, gardening tools, pet supplies , and beauty products, and is also expanding new supply chains.

It is understood that SHEIN has begun to produce goods in Turkey and has also opened new warehouses in the United States and Poland. Among them, the warehouse in Poland is mainly to meet the supply needs of the European market. At the same time, SHEIN plans to build three new large distribution centers in the United States, which can shorten the logistics delivery time to 3-4 days after completion.

At the same time, SHEIN is also actively expanding its offline channels and testing the waters for physical retail through pop-up stores .

Currently, SHEIN pop-up stores have spread to many countries and regions including the United States, Mexico, France, the United Kingdom, Japan , and India .

Through the pop-up store model, SHEIN allows consumers around the world to directly experience the charm of the brand. At the same time, the pop-up store is combined with online activities to redirect offline traffic online, completing the online and offline closed loop and achieving better promotion and traffic generation effects.

In general, in the current market environment, SHEIN is also facing the pressure of transformation and upgrading. Let us wait and see whether SHEIN can successfully go public this year .

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