Blue Pool Capital, a financial company which mainly invests for Alibaba founders Jack Ma and Joe Tsai, has invested $20 million in Rent the Runway – the women’s rental clothing business. The filing was spotted by Lagniappe Labs, a research firm which stated that this fundraising has raised the value of the company slightly below $800 million.
Co-founder and CEO of Rent, Jennifer Hyman, stated that, although her company was not looking to raise fresh funds, when the opportunity came along, she looked at it as a rare and advantageous time in the business’ lifecycle.
“I have huge respect for Joe and Jack and wanted to opportunistically involve them in the business as we embark on our biggest growth stage,” Hyman told Recode in an interview. “Given the global aspirations that we have — especially in Asia — I thought they would be very good people to have around the table.”
The last time the company raised funds was in late 2016, which was through a Series E investment led by Fidelity, for $60 million. That round raised the company value to $750 million. To have a seamless deal with Blue Pool, Hyman permitted the financial firm to invest money with the same terms as the Series E deal from 2016.
Rent the Runway is a service that allows women to rent designer dresses for special events at a portion of the cost of the retail purchase price of the dress. The company was founded in 2009, and in the last two years, the company expanded its service by providing a subscription model that would provide women a rotating closet of clothing on rental basis for everyday wear.
Since China’s largest ecommerce company has invested in Rent the Runway, this deal has given a lot of room for the speculation if Alibaba would be interested in buying Rent the Runway.
“The more visionary, smart people who you have relationships with, it just opens up your optionality,” Hyman said. “It’s good for us whether we IPO, or we sell the business, or we stay private.”