Shein: In the fast lane of fashion
The traditional model of trendsetting in the fashion industry was that a pronouncement would come out from some lofty atelier in Paris that this season sleeves should be the size of spinnakers and hats like satellite dishes, and the world would tug the forelock and follow suit.
This is clearly not applicable to the age of TikTok, and Shein has led the way in turning the model on its head, putting out small quantities of a huge range of items, seeing what sells and thus allowing the consumer to set the trend.
This approach means it is left with vastly less unsold inventory than its rivals, somewhere in the single digits, according to the company, vs the 25%-40% that is the industry norm.
This has helped to turbocharge its extraordinary growth story, hitting $10bn in revenue in 2020, which marked the seventh year of over 100% growth. By 2022 the revenue number was $22.7bn, and the company has said it is targeting revenue of an ambitious $58.5bn in 2025. Its last funding round in April 2022 raised money at a valuation of $100bn, though the recent application of cold water on investors’ fevered brows suggests that its next funding round will be at a more sober $64bn.
Shein has attracted its fair share of controversy, over issues including aggressive tax policies, low postage rates to the US, interesting attitudes to its users’ data, human rights and labour violations, and the environmental impact of fast fashion, and unsurprisingly it is said to be working on transparency and ESG issues ahead of what is rumoured to be a whale of an IPO.
Virgin Orbit: Big flop in the space race
There was the usual Virgin group party atmosphere, complete with food trucks, bars and a silent disco as a large crowd gathered at Spaceport Cornwall in January to watch the first attempt to launch satellites into space from the UK.
Virgin Orbit’s customised 747 with a 24t rocket attached beneath a wing took off without a problem, and the crowd went wild when news came through that the rocket had detached successfully and the first-stage rocket had ignited without a hitch.
Sadly, the party came to an abrupt halt when the second-stage rocket failed due to what was later diagnosed as a faulty fuel filter, reaching a height of 112 miles instead of the intended 345 miles before falling back to earth.
This put the vehicle backed by Sir Richard Branson an awfully long way behind the conspicuously successful operations funded by Elon Musk and Jeff Bezos in the billionaire space race, and ultimately it proved a failure from which the company was unable to recover.
Virgin Orbit was spun out of Branson’s Virgin Galactic space tourism group in 2017, and it went public in January last year via a special purpose acquisition company at a valuation of $3.7bn. Now the group has announced that it is laying off 85% of its workforce after it failed to secure the meaningful funding it would need to carry on its mission.
It has announced that it will be ceasing operations for the foreseeable future, and unless it can find a white knight with considerable optimism and extremely deep pockets, it looks as though the dream is over.