The Luxury Closet, a Dubai-based online platform for buying and selling used high-end goods, secured new financing of US$ 14M from GMP Capital on 16 June 2021.
Investors: The funding round was headed by regional investment firm GMP Capital, alongside international and local investors, including Huda Beauty Investment. Dubai-based Awad Capital Ltd. has acted as financial advisers to the company in cooperation with Drake Star Partners. With their support, The Luxury Closet has raised a total of US$32 million till now.
Purpose of the Funding: The proceeds of the latest $14 million equity round will be deployed to implement the company’s expansion outside the United Arab Emirates as the Covid19 pandemic puts more pressure on people’s funds and investors take more curiosity in environment-friendly fashion.
About Luxury Closet
Based in Dubai and founded in 2011 by Kunal Kapoor, The Luxury Closet is a dominant online boutique for buying and selling the latest and second-hand luxury commodities like handbags, clothes, watches and jewellery. With more than 16,000 unique items as part of its selection, it features top luxury brands such as Louis Vuitton, Chanel, Van Cleef and Arpels, Cartier, Rolex, and more. Sellers who wish to use our platform dispatch their products to the company to store in a temperature-controlled warehouse until they are purchased. At the same time, the firm’s experts reaffirm their originality and condition.
In the wake of the Covid-19 pandemic and economic insecurity, the company seeks to capture consumer attention as lockdowns have brought a significant shift in consumer shopping habits to e-commerce.
Scope of Luxury Resale Market: The resale market took off in the Arab Gulf, where spending on a per capita basis was among the world’s highest before the pandemic. But disruptions in trade and tourism caused by the virus ripped through the region last year, leading to a 17% decline in the local luxury market. However, alteration in shopping tastes and the emergence of environmentally aware consumers have proved to be a blessing for resellers. Almost 70% of high-net-worth buyers in the Gulf — who tended to favour the in-store experience in the past — now say they are comfortable with online shopping, according to Bain & Company.
What the Founder has to say: “The future of resale business is luxury resale. It is estimated that one in every six transactions will be pre-owned by the end of the decade.”- Kunal Kapoor, Founder and CEO of The Luxury Closet.
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