Rent the Runway, a fast-growing subscription business plans to speed its growth by secured a $200 million credit facility from Temasek.

This is part of the deal, according to a 2018 Women’s Wear Daily report, that the Singapore-based investment firm received warrants and an “observer seat” on the company’s board.

Image via Rent the Runway

The financing will be used to drive subscription growth, expand its proprietary “reverse logistics” operations and refinance existing debt. The subscription business gives users access to four looks from 450-plus brands at a time for $159 a month and is up 150 percent on a year-over-year basis, according to a 2018 Women’s Wear Daily report.

“As the consumer landscape has changed dramatically, we have normalized the behavior of clothing rental, and access to these funds enables us to accelerate our vision of putting the closet in the cloud for every woman,” said Jennifer Hyman, Rent the Runway’s cofounder and chief executive officer, to Women’s Wear Daily in a 2018 report.

Chief financial officer Scarlett O’Sullivan added: “The ability to draw from this facility gives us flexibility to accelerate our growth plans for our subscription business over the next few years. Working with an equity-minded, long-term strategic partner like Temasek allows us to leverage their unique understanding of our business model and proven track record of supporting high-growth companies.”

Rent the Runway began renting special occasion outfits and was met and still faces skepticism of the brand’s potential.

Rent the Runway is nine years old, but Hyman told Women’s Wear Daily in May that the rental business is still at “the very, very beginning.”

“I’m saying that as a person who already has a company with nine million customers, that’s built it from an idea to a billion-dollar business,” the CEO said. “We’ve normalized the behavior of rental across the country.”

 

SUBSCRIBE TO OUR NEWSLETTER
We respect your privacy. Your information is safe and will never be shared.
Don't miss out. Subscribe today.
×
×
WordPress Popup Plugin