Fast Fashion

Mubadala-backed Shein plans for super-sized London IPO

The 15-year-old online fashion disruptor was valued at $66 billion in a funding round a year ago

People pass through the Bank area of London, where fast-fashion retailer Shein is being encouraged to launch its initial public offering on the London Stock Exchange. (Photo: Getty Images)

Fast fashion disruptor Shein is planning to confidentially file for a London public listing as soon as this week, Sky News reported, the first step in a super-sized initial public offering in the U.K.

The Singapore-headquartered company, which counts Abu Dhabi’s Mubadala as a major shareholder, had been targeting a New York IPO in the second half of last year but Beijing-Washington tensions waylaid those plans. 

To placate U.S. lawmakers in a bid to go public there, Shein has gone so far as to move its HQ from China to Singapore and stop selling its products in the world’s second-largest economy. Executive Chair Donald Tang told the Financial Times last month those efforts were not enough.  

Now the retailer is serving up a potential blockbuster to the sluggish London exchange, although a confidential filing does not necessarily mean a share sale is imminent. The filing will allow Shein to list more quickly if the company decides to move ahead on a market debut.

The 15-year-old company, which also counts venture capital group Sequoia China and private equity group General Atlantic as major backers, was valued at $66 billion in a funding round a year ago. 

While Shein did not invent the technology to help it predict rising fashion trends, the platform to give near real-time data to suppliers — who are mostly in China — created its unique “on-demand” production model, according to Business Insider, which looked into its production practices.

The data sharing allows for a fast turnaround from small order runs to much larger orders when an item is selling well, and to quickly drop an item when it isn’t.

The tight control it keeps over its supply chain has revolutionized fast fashion in recent years, making Shein more in demand among consumers than competitors like Zara and H&M.

Price is another factor in its popularity. McKinsey found the average cost per item from Shein is $14, while Zara is $34.

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