The peer-to- peer digital marketplace is ready for its next chapter after South Korean internet company Naver agreed to buy the peer-to- peer digital marketplace for $1.2 billion in cash on Tuesday.
Poshmark, which operates a secondhand goods marketplace that digitizes the consignment experience, recently made its public debut in January 2021, listing its shares at $42 for a total valuation of over $3 billion. The stock of Poshmark has plummeted along with other 2021 IPO and SPAC names.
Potential buyers, such as Naver, who purchased Poshmark for $17.90 per share, have attracted lower valuations. That sale price represents a 15% premium to Poshmark's closing stock price as of October 3.
Poshmark and Naver have had a number of synergies between the companies, such as the combination of 80 million registered users and 28 million monthly users across its social networking and discovery-based shopping platform, although some investors questioned the timing of the acquisition.
The market has been very volatile the last year and half, Chandra said. It made sense to bring the two businesses together now, from a timing perspective. The acquisition marks Naver's entrance into the North American resale industry. The US online re-commerce industry is projected to reach $130 billion by the year 2025, according to data from Activate Consulting.
After the deal closes, Poshmark will continue its operations as a company, but won't have to navigate market volatility as a publicly traded company. Chandra, who founded Poshmark, will continue to run the company for the foreseeable future.
"I'm not going anywhere," he said. We will continue to build Poshmark. Part of the partnership is that they are keeping Poshmark as an independent subsidiary, so I feel it's a phase in the journey as opposed to the end of a journey.