As ecommerce evolves, Faire raises $400M at $12.4B valuation

Faire, an online wholesale marketplace, has raised a $400 million Series G at a valuation of $12.4 billion. The round was co-led by new investor Durable Capital Partners and existing investors D1 Capital Partners and Dragoneer Investment Group, with support from other existing backers.

The San Francisco-based company, which helps small retailers compete with commerce giants like Amazon, has brought in more than $1 billion in private funding since it was founded in 2017.

Investor interest in Faire is the latest example of a shift in focus from direct-to-consumer brands to startups that enable various merchants to reach buyers online.

Although DTC brands Allbirds and Warby Parker had successful debuts on the public markets earlier this year, a number of other companies that employ the same business model have struggled amid increased competition and rising customer acquisition costs via ads on Google, Facebook and Instagram.

Just this week, one-time DTC darling Casper agreed to be taken private. The $6.90-per-share offer represents a 94% premium to the mattress company’s closing share price on Nov. 12., but the reported deal price of $308 million is significantly below the $1.1 billion valuation Casper garnered with its last private round in 2019, according to PitchBook data.

In a blog post about the evolution of online commerce, Forerunner Ventures, a firm that has built a reputation as a preeminent DTC investor, claims that the future of online retail will be driven by sellers that are “now frequently a person or small business.”

Faire fits squarely in that evolution. Forerunner, which has recently begun moving away from DTC investments and focusing more on B2B startups, co-led the company’s $12 million Series A in 2018.

Featured image by Feodora Chiosea/Getty Images