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A shoemaker turns billionaire with luxury goods IPO
[LONDON] The founder of online luxury goods hub Farfetch has bagged a billion-dollar fortune.
Shares of the London-based company closed at US$28.45 on Friday after the firm's initial public offering in New York the previous day. Jose Neves, 44, owns 14.8 per cent of Farfetch, according to a prospectus, valuing his stake at as much as US$1.2 billion.
Farfetch raised US$885 million in Thursday's initial public offering (IPO), selling shares above the company's marketed range of US$17 to US$19 each.
Farfetch's website helps global, deep-pocketed shoppers get their hands on high-end goods such as an US$8,287 leopard-print coat or US$980 sneakers. The company also offers services that help sellers create content for online boutiques, manage product returns and analyse consumer data to determine pricing and inventory.
In February, Mr Neves told Bloomberg TV that Farfetch didn't have any IPO plans. Seven months later, the company registered with US regulators for the public sale of its Class A shares.
Mr Neves joins France's Bernard Arnault, chairman of LVMH Moet Hennessy Louis Vuitton, and Spain's Zara founder Amancio Ortega as self-made fashion industry billionaires.
Like its Milan-based rival Yoox Net-A-Porter Group, Farfetch has helped to shake up luxury fashion through focusing on e-commerce in an industry previously dominated by retailers with brick-and-mortar stores. This year, Swiss luxury goods company Richemont acquired YNAP for US$3.3 billion.
A Portuguese native, Mr Neves set up Farfetch in 2007. His interest in fashion and computer software stems from the family's shoemaking past and his receiving a computer for Christmas when he was 8 years old, Mr Neves said in a letter included in the prospectus. Before creating Farfetch, he set up sneaker brand Swear, which re-launched last year.
"The idea of an unrivaled, inclusive, inspiring destination where the whole world of fashion would meet – creators, curators and consumers, all united for the love of fashion – was the vision that is at the heart of Farfetch today," Mr Neves said in the letter. "This 10-year journey, which started in the middle of a global financial crisis, was far from easy!"
Mr Neves owns all of Farfetch's Class B stock through an Isle of Man holding company. He didn't sell any shares in the IPO. His stake is convertible to Class A shares, according to the prospectus.
A spokesman for Mr Neves declined to comment.