Luxury rental platform The Volte has closed its Series A capital raise led by eBay Ventures, eBay’s venture capital investment arm.
The Series A investment round, which was oversubscribed at approximately $4 million, also included investment from venture capital firm BetterLabs.
The two companies are planning to enter into a commercial partnership that aims to benefit sellers, buyers and brands.
eBay Australia head of fashion Brooke Eichhorn said the deal is a strategic step forward for its recommerce model.
"eBay has long been a champion of fashion recommerce, with 16 million pre-loved fashion items listed for sale on eBay.com.au in previous years,” Eichhorn said. “This partnership with The Volte will enable us to continue challenging and changing what it means to buy, sell and love fashion.
“Buy now, earn now, sell later are opportunities that last a lifetime. By pioneering greater accessibility, transparency and sustainability – we are way ahead of the curve in making fashion go further.”
The Volte CEO and co-founder Bernadette Olivier said the investment reinforces the global consumer shift away from disposable fashion.
“Key to the fashion industry becoming sustainable is for better-made, high-quality items to stay in circulation for longer,” Olivier said.
“Our partnership with eBay will strengthen The Volte’s ambition to grow the circular fashion economy in Australia and we are already working with eBay Australia on several initiatives that will reduce fashion disposability.”
The Volte allows individuals to monetise and earn income from their designer wardrobe.
The Australia online platform has reported a doubling in month-on-month bookings this year, with more than 70,000 dresses listed on the platform and 300,000 monthly active users.
The Volte claimed a dress is rented out nine times on average on its website, with many lenders earning more than $100,000 a year renting out their designer wardrobe.
“We are all about encouraging people – and making it possible – to purchase better quality clothes, moving away from the fundamentally flawed fast-fashion model,” Olivier said.
“This has the potential to disrupt the $420 billion fast fashion industry. Consumers can look at fashion as an investment, rather than as disposable.”
The Volte is now preparing to pay designers a royalty every time one of their garments is rent on its platform.
The move means shoppers can save purchases to the ‘lend’ plug-in at designers’ website checkout, with the ‘digital passport’ of the garment saved to The Volte.
“With the growth of these secondary markets, fashion designers may be earning more revenue from royalties than their initial sale,” says Olivier said.
For example, The Volte reported that an Aje Entwined dress has been rented 36 times. The retail price of the dress was $695, and royalties paid would have amounted to AUD$864, which equates to a 450% uplift on profit for the designer.
“Sustainability and royalties for designers have been company values from the beginning. Why should other creatives receive royalties but not fashion designers?”
Rebecca Vallance, Effie Kats, Kit X and Alemais are the first brands utilising the Australian-first technology, with discussions already underway with more than 30 Australian and international designers.