TAIPEI, Oct. 20, 2023 /PRNewswire/ -- PopChill, a Taiwan-based fashion luxury marketplace, announced on October 19th that it has secured an investment of US$1.9 million. The investors in this round include ITIC, AVA Angels Fund, 500 Global, Acorn Pacific Ventures, and Darwin Venture. Including the funds previously raised, the team has garnered a total of US$5.2 million. PopChill stated that their current business model has found a niche in the Taiwanese market, and this round of funds will primarily be used to expand into the Hong Kong market, hoping to replicate the rapid growth experienced in Taiwan over the past year.
Rapid growth in the Taiwanese market, monthly GMV surpasses $1 million
Unlike traditional e-commerce platforms where sellers and buyers trade directly, PopChill adopts an authentication model in the middle. Sellers independently list their products with their own set prices. Once a product is sold, it is first sent to the platform for authentication and quality inspection before being shipped to the buyer, ensuring a secure transaction for the buyer. Apart from verifying the authenticity of the product, the platform also ensures that the product matches its online description. This model addresses the pain points of online transactions of second-hand luxury goods. For product authentication, PopChill collaborates with the AI authentication company Entrupy, using machine learning for authentication with an accuracy rate of 99.1%.
PopChill's co-founder, Andy Kuo, said: "After a year of operation, the current monthly transaction volume in the Taiwanese market has exceeded US$1 million. The average order value on the platform has also reached US$800, representing the trust that buyers and sellers have in the platform." The Taiwanese market maintains a growth of at least 10% every month, not only establishing a reputation in the luxury market but also gradually reaching a wider audience.
Recognizing the potential of the Hong Kong luxury market
After finding its niche in Taiwan, PopChill began to actively look towards oversea markets. PopChill chose Hong Kong as their first stop. In addition to observing the high demand and supply for luxury goods in Hong Kong, they also recognized the advantage of zero tariffs. Over the past quarter, PopChill has been actively establishing its presence in Hong Kong, forming a local team and an authentication center, and integrating local logistics. Unlike most Taiwanese e-commerce teams which focus on the Taiwanese market in their early stages, PopChill took a different path, deciding to go international at a relatively early stage.
In addition to promoting local transactions, PopChill also saw opportunities for cross-regional transactions. For items with a lower transaction value, considering tariffs and shipping costs, prices often lack competitiveness. However, luxury items have a very high order value. PopChill effectively facilitates trading between buyers and sellers in Taiwan and Hong Kong, using the authentication mechanism to ensure transaction security.
Venture capital support helps in quicker scaling
PopChill has currently secured US$5.2 million, enough for overseas expansion for the next 1.5 years. In addition to targeting the Hong Kong market, they also plan to enter the Singaporean and Malaysian markets by 2024. Typically, two-sided platforms have to readdress the supply/demand "chicken and egg" problem when entering a new market. Through cross-region transactions, PopChill can leverage existing market supply/demand without starting from scratch.
Andy Kuo stated: "Our goal for the Hong Kong branch is to replicate the growth trajectory experienced in Taiwan over the past few months, rapidly establishing supply and demand locally." After validating this business model in Hong Kong, PopChill plans to raise Series A funding. By then, the team will have more resources to expand into other overseas markets and hopes to introduce this service to other Southeast Asian and nearby markets.
PopChill website: https://www.popchill.com