Fab.com Digs Its Heels Into Fashion

Fast-growing Fab.com makes a play for fashion customers with the acquisition of FashionStake.

Image: Fab.com

The deal-space fashion frenzy is on. Fab.com—fresh from a $40 million funding round last month—is making more of a play for fashion customers with the acquisition of FashionStake, which features independent designers.

Fab CEO Jason Goldberg declined Portfolio.com’s request to disclose the terms of the deal, but said that FashionStake cofounders Vivian Weng and Daniel Gulati will be the sole employees joining the Fab.com team as it expands its fashion presence. It's unclear how many others were part of the FashionStake website, which will redirect to Fab.com.

A New York City startup that is just two years old, FashionStake is known for bringing emerging designers to e-commerce. It was backed by Battery Ventures and was chosen as an InStyle Best of Web company.

The move into fashion is an interesting one for Fab.com, which now boasts 1.65 million members, having added 350,000 in the last month alone amid news that it received $40 million in funding. Like Fab, it puts a spotlight on the designers behind the highly curated array of apparel and accessories it offers.

Fab.com has thus far offered fashion as one category among other merchandise such as home decor (for which it is perhaps better known initially), jewelry, art, gifts, and gadgets. In a blog announcement about the purchase, Goldberg says the site was just responding to consumer demand.

“Scattered here and there in our sales the past few months, alongside lots of home decor, jewelry, art, gifts, and gadgets, we’ve also sold a lot of fashion,” Goldberg said in a blog post today. “From shirts to skirts to hats to gloves to street wear to shoes to belts and more, we’ve sold them all on Fab and our members have roundly responded with ‘more please!’So, today, we’re doubling down on fashion.”

The move into fashion will put Fab into a tight field that already includes Gilt.com, HauteLook, and Ideeli, among other U.S. players including a new entry, French flash-sales pioneer Vente-Privée. But the site's growth gives credence to statistics that suggest that the daily deal market isn't done growing yet. It is forecast to grow from $2 billion last year to $4 billion by 2015, fueled by daily deal sites like Groupon and flash-sales players alike.

The founders behind FashionStake are both Harvard Business School alumni with banking experience. Weng worked for various emerging designers and established brands including Elie Tahari and Escada, while Gulati is an author who founded three companies in the consumer and media space.