RTR was hit hard by COVID, as demand for fashionable clothing decreased as less people were going out. The subscriber count is substantially lower compared to before the pandemic, as RTR reports that it had 133,572 active subscribers in the 2019 fiscal year before the pandemic. The company offers subscribers various options which let them rent out clothing picked out by experts on a monthly basis and declares in its prospectus that it "has transformed the way women get dressed by letting them wear whatever they want, without having to own it." RTR has served over 2.5 million customers throughout its lifetime and had 97,614 active subscribers as of July 31, 2021. For those seeking to stay fashionable, would it not be easier and cheaper to rent clothes that ensure you can keep up with the times? We buy clothing with the expectation that it will last for years, yet often paradoxically are confronted with the reality that in a few years, said clothes may fall out of fashion. Everything about this company, from its potential for growth to the way it presents its numbers, offers serious questions more than opportunity. However, there are numerous problems with this narrative and many reasons to stay far away from this IPO. The narrative the company wants to sell now is that it is a successful company which faced a dip due to COVID but is now ready to do better than ever. This would represent an impressive turnaround for a company which has been hit hard by the pandemic, as Rent the Runway (RTR) was forced to slash employment, take on additional debt, and saw its valuation decline to around $750 million. Barron's reported that "The New York company plans to offer 15 million shares at $18 to $21," which would give the company a valuation of $1.3 billion at the maximum price.
Online clothing company Rent the Runway ( NASDAQ: RENT) has released pricing details about its planned IPO for October 26. Massimo Giachetti/iStock Editorial via Getty Images
0 kommentar(er)
