Shein – the Chinese fashion e-commerce company that is sweeping the world with its high prices – has been in talks with Google and Amazon about a potential investment in the company. The talks – which ultimately collapsed – were reported today by The Information.
According to the site, Shein decided to reach out to the two companies because she plans to increase her ad spend on Google and with the cloud on either Amazon or Google.
With big tech companies already doing business with companies that are their customers, Shein saw an opportunity to capture both, which could reduce their spending on those services. However, neither company showed interest in the deal.
The approach came at a time when Sheen is working on a billionaire round that could value the company at $60 billion, the Financial Times previously reported.
That sounds like a lot, but the valuation will be about half what it was last year when Shein was valued at $100 billion.
Founded in China in 2012, Sheen has built a fashion e-commerce industry that rivals global chains like H&M and Zara. The secret, she says, is the combination of China’s sprawling supply chain and an advanced data analysis system.
According to the information, Shein was able to offer a wide range of new products at very reasonable prices while keeping its inventories low. This is possible because real-time data is used to analyze consumer behavior and predict what they might want to buy.
In Brazil, too, Shein is irritating big chains, with retailers like Renner questioning the fact that it doesn’t pay taxes on its international sales, which Renner says creates unfair competition.
Information estimates that Shein spent $200 million on cloud services last year when the company’s revenue was $23 billion. “There’s good reason Shein thinks Big Tech would be interested in the deal,” the site wrote.
“Microsoft has acquired stakes in several companies, including OpenAI and General Motors Cruise, as part of larger deals in which they will become customers of the Azure cloud service.”
Earlier this month, Google also invested $300 million in AI startup Anthropic, a Google Cloud customer. In 2021, he also invested $1 billion in CME Group in a deal that saw the company become a Google Cloud customer.