Chinese luxury goods website raises seed round of financing

The Luxury Club, which was founded by Francis Gouten, former CEO of Richemont Group Asia Pacific, has established a strategic marketing cooperation agreement with Taobao Mall, Alibaba Group's leading business-to-consumer online retail platform. Like many companies, The Luxury Group hopes this channel will enable it to distribute more widely among China's emerging consumer classes.

As part of the deal, Laurent Ohana, managing partner and Parkview, and Sherry Lin, managing director at Mousse, will join The Luxury Group's board as member and observer, respectively.

According to a recent report by McKinsey & Company, sales of luxury goods in China rose 16% to RMB64 billion ($10 billion) in 2009, down by only four percentage points on 2008, despite the country experiencing an economic downturn. McKinsey expects sales to reach $27 billion by 2015, accounting for 20% of the luxury market worldwide.

Private equity firms are seeking to leverage this growth in a variety of ways. Buyout firms that have global fashion brands in their portfolios - such as Permira's Valentino Fashion Group - are aggressively targeting Asia. L Capital, LVMH's private equity arm, is making mid-size investments across the region.

The Luxury Club deal is just one example of thriving early-stage activity. Earlier this month, Affinity China, which provides exclusive offers from global brands to Chinese consumers traveling overseas, secured $600,000 in seed funding from venture capital firms RRE Ventures and 500 Startups, alongside strategic investor Loeb Enterprises.

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• Topics
• Consumer
• Greater China
• Early-stage
• Consumer
• Venture
• China
• L Capital Asia
• Permira Advisers