Fashion retailer Love, Bonito bags US$50m to fund international expansion

ONLINE fashion retailer Love, Bonito has raised US$50 million in a Series C round led by China-based private equity (PE) firm Primavera Capital Group to fuel expansion in international markets, as the startup moves to capitalise on a pandemic-fuelled e-commerce boom.

This marks Primavera Capital's first investment into South-east Asia. The PE firm - which had previously invested in Alibaba, ByteDance and Yum China - is joined by Japan-based retail giant Adastria and Chinese venture capital firm Ondine Capital, the company said in a media briefing on Wednesday.

Current investors include Temasek-backed Openspace Ventures, and Japanese online price comparison website Kakaku.com.

Love, Bonito, which first started as a blog site selling used clothes, now designs and manufactures its own pieces for sale online and in 16 physical stores. It has a presence in over 10 markets in South-east Asia, East Asia, Australia and the US.

The fashion startup needs to move quickly. The pandemic is driving more house-bound shoppers online, but other e-commerce players and online fashion retailers like Shein or Pomelo are turning up the heat too in competition for a larger slice of the booming consumer market.

Fresh funds will thus be used to double down on its existing markets as well as drive international expansion in Hong Kong, Japan, the Philippines and the US, on the back of a boost in sales amid the Covid-19 pandemic. It will start by deepening partnerships in these countries, building up local teams and organising pop-up stores in states such as California and New York.

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Love, Bonito hopes to push global expansion across 3 key regions, said chief executive Dione Song.

"The first region (is) South-east Asia, it's our home ground where we've been operating in for a long time. Next is East Asia, after we started identifying good organic traction from women in Hong Kong, Taiwan and Japan who heard about us. The third key area of focus is in the US and Australia, where we hope to reach the Asian diaspora there."

To date, about half of Love, Bonito's revenue comes from markets outside of Singapore. The city-state is still its largest market, followed by Malaysia. The company added that it has achieved more than 120 per cent year-on-year overall growth in international markets, and overall growth of 208 per cent for its online sales.

According to regulatory filings, the group clocked S$31.4 million in annual sales for the year ended Dec 31, 2020, down 2.3 per cent from a year earlier. Net loss narrowed to S$5.3 million in FY2020, from S$7.8 million in the year prior. Net assets of the group as at end-December amounted to S$4.9 million. These figures might not completely reflect the group's financial position today.

Love, Bonito also has plans to expand its apparel mix to include activewear and accessories. The brand is next looking to integrate personalised shopping into its platform and launch various initiatives next year, such as online forums for women.