Queenly, a startup constructing a garment market geared toward dressing ladies for formal occasions, introduced this morning that it has bought Mi Padrino, an organization constructed to serve the quinceañera market.
The 2 corporations’ overlap is apparent: Quinceañeras, occasions the place women have a good time their fifteenth birthday with a big occasion and ornate garb, is an occasion varietal that Queenly’s product helps. The deal caught our eye not for an absence of synergy, then, however extra as a result of relative youth of Queenly itself.
Nob6 has questioned whether or not the current market downturn would result in startup-on-startup M&A exercise. The Queenly deal is one datapoint that helps that specific thesis.
And Queenly is a startup that a number of of us at Nob6 have had our eyes on since its days as a part of Y Combinator and thru its 2021 fundraising occasions. So when it reached out with information that it had, regardless of its comparatively modest company age, purchased one thing, we bought on the telephone. Let’s speak about it.
Nob6 caught up with Queenly CEO Trisha Bantigue this week to debate the deal and the standing of her formalwear-focused startup. (If her title sounds acquainted, recall that Bantigue got here on the Fairness podcast to talk about distant accelerators in early 2021 and wrote an essay in regards to the psychological well being impacts of constructing a startup for Fortune in 2022.) What we wished to search out out was easy: How is the corporate performing, and why is it shopping for one other startup so early in its life?
On the efficiency entrance, issues look like going nicely on the firm. As a result of Queenly is inherently tied to the IRL market, as COVID wanes in customers’ minds and formal-dress occasions creep again onto our calendars, you may anticipate that it’s posting fast progress in current quarters. Appropriate. Per Bantigue, Queenly’s enterprise has successfully doubled from This autumn 2021 to Q1 2022, and once more from Q1 2022 to the second quarter of this yr.
That progress doesn’t all stem from the corporate’s unique enterprise. Over time, Queenly has expanded its mannequin past consumer garment resale. It additionally works with smaller brick-and-mortar promenade and formalwear shops that lack a digital presence and has offers with some clothes manufacturers to promote immediately via its web site. Resale stays about 75% of Queenly transactions, in accordance with Bantigue, with an additional 15% coming from small-business companions and a remaining 10% from designers themselves.
The Mi Padrino deal
Bantigue mentioned Queenly initially linked to Mi Padrino by way of an investor. Throughout an early name, Bantigue realized that it was on the market. Though she didn’t anticipate to purchase one other firm so early in her startup’s life, she ran a diligence course of and, after months of analysis and hammering out the deal, Queenly’s work to accumulate the smaller firm wrapped round two weeks in the past.
Phrases weren’t disclosed, however on this case, we’re not too mad about it. Why? As a result of what Queenly purchased was not a big, working enterprise; Mi Padrino had contracted to a diminutive scale in personnel phrases by the point that it bought. And Queenly is barely holding Mi Padrino’s dress-focused enterprise, leaving the remainder of what its acquisition supplied behind it. (DJ and photographer suggestions are helpful, however don’t neatly land within what Queenly does.)
So what is absolutely being bought? Model, content material, and historical past, it seems. The Mi Padrino model is healthier identified in Hispanic circles than Queenly, the latter firm defined, and it has a library of content material that would assist deliver extra prospects to its new company mum or dad. Queenly will get a deeper hook into a big formalwear market, probably serving to it sustain its progress cadence — the vast majority of Mi Padrino’s income was sourced from its dress-related enterprise, Bantigue mentioned.
Past the transaction, Queenly is engaged on a group facet to its enterprise that it likened to Sephora’s, in addition to a model ambassador program for the upcoming college yr. Lastly, co-founder and CTO Kathy Zhou is constructing a reverse picture search in order that customers can deliver a picture of a costume that they like to Queenly, which can then be capable of assist them discover and purchase it.
The clothes resale market is large and growing. And regardless of some troubles at Rent the Runway, it’s clearly a spot the place know-how may have a long-term residence. Let’s see how briskly Queenly can develop within the again half of 2022 and whether or not that shakes free extra capital.