KupiVIP, Russia’s fashion-centered flash sale leader, announced Thursday that it has raised $38 million in a round of funding from Intel Capital, Acton Capital Partners, European Bank for Reconstruction and Development, and existing investors Accel Partners and Balderton Capital. The round brings KupiVIP’s total raised to $104 million.
Founded in 2008 by German entrepreneur Oskar Hartmann, the flash sale site specializes in high end fashion and offers discounts of up to 90% off more than 1,500 brands. The company has built up a steady user base of some eight million members across its family of sites, including its online luxury boutique KupiLUXE.ru, as well as its family shopping site ShopTime.ru.
The e-commerce giant says it plans to use the new funds to bolster several projects, particularly the organization of a new 20,000 square-meter warehouse and open storage area.
CEO Oskar Hartmann also told reporters earlier this week that the company is eyeing an initial public offering in New York some time within the next two years. Hartmann believes the company could raise $120 million. The float would follow the lead of fellow Russian successes Yandex, which went public in May 2011 and raised $1.3 billion in an offering that sold above the proposed range.
Mail.ru also went public in November 2010 and raised $912 million. Today, the company is trading at $33 USD, up from the $23.70-27.70 range offered in 2010. Yandex is currently trading at $17.92 USD, down from the $25 initial share price.
Russian tech companies are attracting a lot of investor attention these days. Fellow e-commerce company Ozon.ru made Russian history last year when it raised $100 million in a round of financing from ru-NET Holdings, Japanese company Rakuten, Alpha Associates, and Index Ventures.
The draw could be the skyrocketing number of Internet users in Russia. In 2010, 43.37% of the population was using the Internet, compared to just 27% in 2008.
KupiVIP could not be reached for comment, but Hartmann told reporters on Monday that the company aims to reach an annual turnover of $1 billion within the next four years.