REVOLVE GROUP SOFTWARE

Even in 2003, fashion shoppers were growing weary of having to trek to bricks-and-mortar stores to shop for clothing, unsure of whether they would find what they were looking for, Karanikolas said. The pairвЂ™s deep dive into keyword searches and online behavior divulged something they hadnвЂ™t considered before, well before some longtime fashionistas and clothing industry veterans noticed it.

вЂњAnd it really helped us spot opportunities consistently, I think, before a lot of the rest of the marketplace.вЂќ Data was something we were comfortable with,вЂќ Karanikolas said. вЂњTechnology was something weвЂ™d just grown up with. вЂњWe were both very analytical,вЂќ Mente said, which helped them home in on an idea for a new business. Mente and Karanikolas were out of a job, but had gained valuable insight about themselves and how well they worked together. But the stock market downturn that began in 2000 turned the boom into a bust. Karanikolas was hired by the same company in 2000, after earning a degree in computer engineering at Virginia Tech.ДЄs the youngest employees at the company, the two 20-somethings quickly bonded.

REVOLVE GROUP SOFTWARE

Mente was in an entrepreneurship program at USC when he dropped out to join software company NextStrat in Los Angeles.

Karanikolas and Mente had planned to ride the tech industry dot-com boom that had begun in 1995. We felt like we could come out of the gates with a better approach and then continue to build on that.вЂќ But there werenвЂ™t really that many players doing it or doing it well.

вЂњThere was a large and growing interest in apparel online. Revolve, which has 3.3 million Instagram followers on its primary account alone, focuses on selling apparel, shoes and accessories to millennial and Generation Z women and men, adding beauty products nearly three years ago. In lieu of traditional advertising, Revolve uses much of its marketing budget to pamper a revolving group of about 3,500 Instagram influencers - including Kendall Jenner, for a time - for wearing its brands as well as the designer names it carries. Revolve is only one of the fashion e-tailers harnessing the social media marketing juggernaut to sell to young and urban customers, but itвЂ™s the first to pull back the dressing room curtain to give the world a look at its financial underpinnings. The Cerritos company raised $211.7 million. Shares opened on the New York Stock Exchange at $25.16, almost 40% higher than the $18 asking price. Michael Mente, 38, and Mike Karanikolas, 41, are co-chief executives of Revolve, whose initial public offering in June was one of the yearвЂ™s most successful. It was valued at nearly $1.5 billion when it recently went public and, despite a snag here and there, is headed to more than $600 million in sales this year. Now theyвЂ™re running one of the fastest-growing e-commerce clothing companies in the nation: Revolve Group. In this case, investors probably didn't like that sales growth decelerated to 40% year over year in July.Two young tech co-workers named Michael, who knew absolutely nothing about fashion, unexpectedly found themselves in the rag bin of the dot-com bust at the beginning of the century. This was a meaningful acceleration over the first quarter's 22% increase in sales.Д«ut with the share price soaring to a high valuation recently, some investors may have headed into the quarter with itchy trigger fingers. Net sales increased by 60% year over year to $228 million, while net profitВ more than doubled over the year-ago quarter. Taking the quarter at face value, the company is clearly performing very well. EDT on Thursday, the stock is still up 81% year to date. Even with the share price down 18.9% as of 11:20 a.m. The apparel stock had been steadily rising this year, as investors viewed the stock as a good reopening play. Revolve Group ( RVLV 1.74%) reported second-quarter earnings results that significantly exceeded analysts' expectations.В What seemed to spook investors was that the company's sales growth showed a sharp deceleration from the end of Q2 into July.В While management expressed optimism about the recovery underway in the economy,В it said that COVID-19 is still negatively impacting the business in certain markets around the world.

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