Global Fashion Group

Global Fashion Group (GFG) is an international online fashion and lifestyle retailer headquartered in Luxembourg. The company was founded in 2011 as a joint venture between Rocket Internet and Kinnevik. It serves as an umbrella organization for multiple regional e-commerce platforms specializing in fashion, including Zalora in Southeast Asia, Dafiti in Latin America, and THE ICONIC in Australia and New Zealand.

Global Fashion Group S.A.
TypePublic (Société Anonyme)
FWB: GFG
ISINLU2010095458
IndustryE-commerce, fashion, retail
Founded2011[1][2]
Headquarters
Nidderaanwen, Luxembourg (legal domicile)
Singapore (operational headquarters)
Key people
Cynthia Gordon (Chair)
Christoph Barchewitz (CEO)
ProductsClothing, shoes, accessories, beauty
Revenue€1.36 Billion (2020)
OwnersKinnevik AB (Lead)[3]
Rocket Internet SE[4]
Access Industries
Summit Partners
Ontario Teachers' Pension Plan
Tengelmann Group
Verlinvest[5]
MembersDafiti, THE ICONIC, Zalora
Number of employees
9,000+
Websitehttps://global-fashion-group.com

GFG aims to bring fashion to emerging markets, leveraging an assortment of global and local brands and designers. It operates in over 20 countries and has become a significant player in the online fashion industry.

GFG is led by CEO Christoph Barchewitz.

History

Global Fashion Group (GFG) was established in 2014 through a consolidation of fashion e-commerce regional companies backed by Kinnevik and Rocket Internet. Its regional companies Dafiti, lamoda, THE ICONIC, ZALORA and Jabong (later sold) were founded in 2011 and 2012.[6][7]

In 2011 and 2012, the GFG regional companies began operations with a business model of selling inventory to customers from its own warehouses.

From 2013, the GFG regional companies started creating their own private-label brands, such as Lost Ink and ZALORA (formerly Ezra).[8]

In April 2015, Romain Voog was appointed chief executive officer of GFG.[9] He retained the role for approximately 3 years.

In 2016, GFG rolled out its Marketplace platform across key markets to complement its traditional inventory-led model.[10]

In April 2017, GFG appointed Cynthia Gordon, a board member of Kinnevik, as the new Chair of GFG Board of Directors.[11]

In February 2018, Patrick Schmidt and Christoph Barchewitz were appointed co-chief executive officers, succeeding Romain Voog.[12]

As of July 2019, it is now listed on the Frankfurt Stock Exchange (ticker symbol: GFG).[13]

Geographical operations and presence

GFG is registered in Luxembourg, and headquartered in Singapore and London, UK. Through its four regional companies, GFG currently operates across 24 markets with a total population of more than 1 billion, serving a fashion market estimated to be worth over €350 billion.

Since their launch in 2011 and 2012, the five GFG regional companies have developed online fashion platforms in their respective markets.[7]

The Group operates more than 10 warehouses across the world, including THE ICONIC's new 19,000sqm "fulfilment centre" in Australia[14] and ZALORA’S new Regional e-Fulfilment Hub in Malaysia.[15][16]

As of 31 December 2018, GFG has more than 11 million active customers and over 10,000 employees.[17][11]

International brands

In April 2017, ZALORA established a partnership with Abercrombie & Fitch. This partnership will provide Abercrombie & Fitch access to more than 600 million of ZALORA's online customers.[18]

Private labels

From 2013, the GFG regional companies started creating their own private label brands, with in-house design teams and collaboration with local designers.[19] GFG private label brands include Lost Ink, ZALORA (formerly EZRA), ZALIA, 24:01 and Something Borrowed.

Business figures

In April 2018, GFG reported net revenue of over €1 billion in 2017 (excluding Jabong and Namshi), with sales up 19.9% from 2016.

Still on its path to profitability, GFG improved its adjusted EBITDA margin from (12.5)% in 2016 to (8.9%) in 2017. It credits this improvement with investments and efficiency gains in marketing and fulfilment.[20] Namshi was the first GFG regional company to achieve full-year profitability in 2016 with an adjusted EBITDA of €2.5 million.[20]

GFG ended 2017 with €257.3 million in cash on a pro-forma basis.[20]

Year Net Revenue (EURm) Revenue growth (%, FX neutral basis) Adjusted EBITDA margin Cash position (EURm)
2014[10] 627.5 Undisclosed (38.0)% 223.8
2015[11][10] 808.0 48.2% (26.9)% 76.7
2016[11] 1023.1 (excl. Jabong) 26.4% (12.5)% 255.0
2017 1095.0 (excl. Jabong & Namshi) 19.9% (8.9%) 257.3
2018 1155.9 18.7% (4.3%) 178 end of Q1 2019

Fundraising and M&A

Fundraising

In 2015, GFG raised €150 million from existing investors Kinnevik and Rocket Internet in an internal financing round.[21][22]

GFG secured additional funding of €330 million from existing shareholders led by Kinnevik and Rocket Internet during H1 2016. The funding round resulted in a cash balance of €342.6 million at the end of H1 2016.[10]

Acquisitions

In 2015, GFG acquired sports and outdoor activities e-commerce company Kanui, and kids/ baby-focused online retailer Tricae. Both deals are undisclosed and the two Brazil-based businesses have been integrated into Dafiti.[21]

Strategic partnerships

In February 2017, GFG announced a strategic partnership with one of the Philippines’ oldest and largest conglomerates, the Ayala Group. Ayala invested to take a 49% ownership in ZALORA Philippines.[11][23]

Divestments

In March 2016, GFG's South American business Dafiti sold its operations in Mexico.[24]

In April 2016, GFG's Southeast Asian business ZALORA sold its operations in Thailand and Vietnam to retailer Central Group for an undisclosed amount.[10]

In August 2016, GFG sold its Indian business Jabong to Flipkart for US$70 million in cash.[10]

On December 13, 2022, GFG successfully completed the sale of Lamoda's business in Russia, Kazakhstan and Belarus to Yakov Panchenko, owner of the Stockmann department store chain.[25]

References
  1. Lunden, Ingrid (4 September 2014). "Rocket Internet Consolidates 5 Emerging Market Fashion Brands Into One: $3.5B GFG". Techcrunch. Retrieved 24 August 2017.
  2. "Kinnevik and Rocket Internet to create global fashion e-commerce group". Kinnevik. Archived from the original on 9 April 2017. Retrieved 24 August 2017.
  3. "Our Investments, Global Fashion Group". Kinnevik. Retrieved 24 August 2017.
  4. Russell, Jon (22 July 2016). "Rocket Internet's GFG closes $365M down round as external investors shy away". Techcrunch. Retrieved 24 August 2017.
  5. "GFG Digital & Ecommerce". Verlinvest. Retrieved 24 August 2017.
  6. Lunden, Ingrid (4 September 2014). "Rocket Internet Consolidates 5 Emerging Market Fashion Brands Into One: $3.5B GFG | TechCrunch". Retrieved 2017-08-21.
  7. "Kinnevik | Kinnevik and Rocket Internet to create global fashion e-commerce group". www.kinnevik.com. Archived from the original on 2017-04-09. Retrieved 2017-08-21.
  8. "Tech in Asia - Connecting Asia's startup ecosystem". www.techinasia.com. Retrieved 2017-08-21.
  9. "Global Fashion Group hires ex-Amazon.com exec as CEO". Reuters. April 8, 2015. Retrieved August 22, 2017.
  10. "Archived copy" (PDF). Archived from the original (PDF) on 2017-08-21. Retrieved 2017-08-21.{{cite web}}: CS1 maint: archived copy as title (link)
  11. "Archived copy" (PDF). Archived from the original (PDF) on 2017-08-29. Retrieved 2017-08-21.{{cite web}}: CS1 maint: archived copy as title (link)
  12. "GFG CEO Announcement" (PDF).
  13. Fish, 3 July 2019By Isabella (3 July 2019). "Global Fashion Group lists on Frankfurt Stock Exchange". Drapers. Retrieved 2019-07-05.
  14. "The Iconic has moved to a new 19,000sqm fulfilment centre - Internet Retailing". Internet Retailing. 2017-04-18. Retrieved 2017-08-21.
  15. "Zalora invests US$4.2mil on regional e-fulfilment hub in Malaysia". Digital News Asia. 2017-03-10. Retrieved 2017-08-21.
  16. "A Rare Peek Inside the Zalora Warehouse | Preview.ph". Preview.ph. Retrieved 2017-08-21.
  17. "Global Fashion Group - WE ARE BRINGING FASHION ONLINE – WORLDWIDE". global-fashion-group.com. Retrieved 2017-08-21.
  18. "[4.11] Ecommerce News You Should Know: Zalora to Stock Abercrombie & Fitch in Asia". ecommerceIQ - Ecommerce in Southeast Asia, Reports, Data, Insights. 2017-04-11. Retrieved 2017-08-21.
  19. "Zalora supports Asian designers". Manila Standard. Retrieved 2017-08-21.
  20. "Global Fashion Group posts improved 2016 revenue but still making losses". Tech.eu. Retrieved 2017-08-21.
  21. Russell, Jon (July 2015). "Rocket Internet And Kinnevik Add $167M More To GFG, Roll In 2 Brazilian Fashion Portals | TechCrunch". Retrieved 2017-08-21.
  22. "Zalora's owner raises €150m from existing investors AB Kinnevik, Rocket Internet - DealStreetAsia". www.dealstreetasia.com. Retrieved 2017-08-21.
  23. "Archived copy" (PDF). Archived from the original (PDF) on 2017-08-21. Retrieved 2017-08-21.{{cite web}}: CS1 maint: archived copy as title (link)
  24. Antúnez, Marco. "Inversionistas mexicanos adquieren Dafiti México | ebusinesshoy". ebusinesshoy.com. Retrieved 2017-08-21.
  25. "Global Fashion Group completes sale of Lamoda business in Russia". tass.com. 2022-12-13.
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