Tencent leads $150m financing round for Fab.com

Tencent will appoint a new director to Fab's board and help it expand into the Chinese market. Japanese conglomerate Itochu also took part in the round along with previous investors Andreessen Horowitz, Atomico, Menlo Ventures and others.

Fab started as a gay social network but turned to e-commerce about two years ago.The company is said to have gained traction with interior designers looking for unique and novel furniture and home decorations. Today, half of its sales come from this category, with art, jewellery and fashion making up the rest.

This latest round brings Fab's total funding to date to $310 million. The company's sales grew by more than 500% in 2012, generating sales of $120 million, and are expected to grow around 100% in 2013. However, the company remains unprofitable.

While the deal will allow Fab access to Chinese markets it will also give the Beijing-based Tencent a chance to learn more about e-commerce business models overseas.  

Tencent and other Chinese internet giants such as Baidu, Alibaba and Sina have developed an appetite for strategic venture capital invesments and inorganic expansion in recent years.

Last month, Alibaba Group paid $294 million for a 28% stake in AutoNavi Holdings, a Chinese digital mapping company, while Baidu agreed to pay $370 million for PPStream's online video business, creating an exit for the company's venture capital backers.

 

 

 

 

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