In an interview with Cheddar TV, IPO Edge Editor-in-Chief John Jannarone explains what it will take for newly-listed shares of The RealReal (ticker: REAL) to maintain their current sales multiple. The company, which sells second-hand luxury goods from fashion houses such as Hermès, LVMH Moët Hennessy’s Louis Vuitton, and Kering SA’s Gucci, will likely see customer acquisition costs decline further over time, helping The RealReal forge a path to profitability. One unique phenomenon that should help the company is that buyers often become consignors and vice versa, leading to more transactions. IPO Edge also published a detailed analysis available here.
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