JustFab Acquires ShoeDazzle
JustFab has officially announced that it has acquired Shoedazzle. The two subscription women’s fashion and footwear ecommerce companies have positioned the deal as a “merger,” but this seems like a generous characterization, given the fact that the former is several times larger in terms of revenue, users, and traffic.
The companies declined to specify deal terms, but sources have told us it was an all-stock transaction that valued Shoedazzle at less than half of the $66 million of venture capital it raised. ShoeDazzle co-founder Brian Lee did not disclose figures but did add that ShoeDazzle’s shareholders and board were “very, very happy with the terms.”
In today’s deal announcement, the combined company was described as “the world’s largest fashion subscription e-commerce company.” Lee further referred to it as “truly global, multi-brand lifestyle fashion company.”
Lee and JustFab co-founder Adam Goldenberg predict reaching profitability as a combined company in 2014, with more than $400 million in total sales and more than 33 million global members. The companies are adding roughly 1 million new members per month, according to Goldenberg.
Goldenberg confirms that both the JustFab and ShoeDazzle brands will be maintained independently, thus broadening the company’s demographic and geographic reach. ShoeDazzle is a US-only brand at present, while JustFab has growing operations in Europe. To consumers, each of the brand should look no different after today’s transaction than they did going into it.
The deal brings to an end several months of negotiations between the two women’s fast fashion ecommerce companies. Both Lee and Goldenberg described the transaction as “four years in the making,”
JustFab is a multi-category company, that generates 30 percent of its revenue outside of footwear. ShoeDazzle, on the other hand, is more of a multi-brand platform, focused heavily on shoes. The two companies have slightly different takes on the subscription business model, and while they plan to share learnings going forward, there are no plans to make wholesale changes to either, according to the pair.