The company said it will utilise the investment to drive all-around growth across marketing, stock and production sectors, as well as in machine learning and artificial intelligence (AI) technology.
Co-founded in 2012 by Karl and Elmien Hammerschmidt, who are now the chief executive officer and chief operating officer respectively, RunwaySale describes itself as an ‘exclusive online shopping society’ – a members-only private online shopping club.
The e-tailer hosts more than 300 high-end fashion brands to an exclusive community of shoppers, who check the site, mobile app and social media platforms daily to take advantage of the latest offers.
“E-commerce accounts for one percent of all retail in South Africa and, even before the coronavirus pandemic, was set to grow exponentially,” said Karl Hammerschmidt. “The synergies between the SPEAR Capital team and our own gives us the confidence and practical support we need to develop RunwaySale into a leading player in the local and regional e-commerce market.”
Christophe Gaigneux, who was online chief executive for the European division of TJ Maxx, has been appointed to the RunwaySale advisory board.
“The potential for e-commerce to contribute meaningfully to the local economy has never been greater and RunwaySale will be key to meeting the demand we know is building up in consumers across all demographics in South Africa,” said Gaigneux.
According to BusinessTech, SPEAR Capital concluded its investment in April.
RunwaySale is a web-based company that sells designer brands at discount prices by hosting flash events. It has grown to be South Africa’s largest members-only private online shopping club.
Its website was launched on 15 May 2012 and its head office is located in Cape Town, South Africa. The first angel investor to invest in the company was Michael Leeman who has also invested in ChessCube, Cognician and Personera.
RunwaySale hosts flash sales of various fashion brands. A typical sale lasts between 36–48 hours. When a sale commences, members are notified via e-mail, Facebook and Twitter.
Sales feature merchandise from single brands or small groups of brands at a time and change regularly. The company’s business strategy is to offer designer brands at affordable prices by purchasing vendor inventory at a large discount and adding a margin on top in order to make a profit.