DressX raises 15 million USD in latest round of funding
The fashion may be virtual at DressX, but the funds to fuel its growth is cold hard cash, aka physical legal tender. Founders Daria Shapovalova, CEO, and Natalia Modenova, COO, successfully raised 15 million USD in Series A funding led by Greenfield, with participation from Slow Ventures, Warner Music, The Artemis Fund, Red Dao, and others. The announcement comes on the heels of the recent Paris shows that indicated the market yearning for an old-fashioned physical IRL experience. Despite this, DressX, who hosted a PFW cocktail event and made a splash with a virtual look and try-on at Dundas, continues to emerge as the leading digital fashion platform.
The pair told FashionNetwork.com that the influx of money would help scale the three-year-old business in several ways. The duo debunked any suggestion that the fashion industry may have gotten over the novel tech.
"Brands are applying their knowledge and experiments with web3 to seek the best place for the Metaverse in their strategies. We are launching new projects for at least four brands next month, and more are in development this year," said Shapovalova.
"We aim to sell a billion digital fashion goods and open as many digital wardrobes as needed to be able to power this number," said the CEO. She added in addition to current social media platforms such as Instagram, Facebook, Snapchat, TikTok, and web #D social and game environments, DressX is further exploring web2 3D spaces like Roblox and Meta to use their digital garments and NFTs.
"Mass adoption is happening in those places, and those destinations will intersect in the future," she continued. One of the unique challenges to digital wearables is that unlike physical clothes, which can be worn wherever the user chooses, there are interoperability and ownership hurdles with 3D assets that need to be overcome.
"This depends on the unified standard of files and aims of large web2 companies to open up their infrastructure with bridges," Shapovalova noted. Currently, buyers can choose from over 3500 digital items on DressX and wear the garments in AR, photo dressing, video calls, and on avatars in Decentraland and Ready Player Me and will soon add Snapchat to its external marketplace vendors.
She stressed that digital fashion education is still important; thus, DressX will add more 'gamified experiences' and hopes to seize the huge opportunity to build a deeper connection with the community through the new funds.
According to Morgan Stanley, digital clothing will potentially be a $50 billion market by 2030. A recent Squarespace study found that 60% of Gen Z and 62% of millennials believe your online presentation is more important than IRL. A Barclay Card study found that UK shoppers buy at least 10% of purchases to be worn for a social media post and then returned, an indicator of the need for less costly digital garments. In 2022, Roblox boasted that over 11.5 million users created more than 62 million virtual clothing and accessories items.
The firm and its investors are focusing on these stats, not the recent tech sector shake-ups that have resulted in over 150K workers being laid off in the last six months. Most experts blame the slowdown on rising interest rates. The industry was also spooked this past week by the collapse of Silicon Valley Bank and Signature Bank. DressX did not have funds at either institution.
"Digital fashion is something we have become extremely excited about as a firm," Jascha Samadi, founding partner at Greenfield, said in a release, adding, "There is a huge design space and a new paradigm emerging around the question of what we are wearing within the Metaverse. We're excited to see how this space will evolve over the next 5-10 years."
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