Ultra-fast fashion company Shein has made a confidential filing to the U.S. Securities and Exchanges Commission (SEC) to go public. Shein hopes to land an $80 billion to $90 billion valuation, a significant premium on its latest private valuation of $66 billion in May, according to a Bloomberg report earlier this month. The initial public offering (IPO) would give the public a glimpse into Shein’s leadership team, business practices and financials, which have all been shrouded in secrecy as the company’s market value surpassed global brands like H&M and Zara at one point.
Shein’s confidential filing means the IPO documents are not available to the public yet, giving the company time to work with the SEC to make final changes. As Shein gets closer to going public, those documents will be made public.
Shein’s founder and CEO, Sky Xu, is an elusive figure. Xu (also known as Xu Yangtian and Chris Xu) has declined to be the public face of the company he started in China more than a decade ago. Shein was originally founded as an e-commerce business named Nanjing Dianwei Information Technology in 2008 and has made Xu one of the richest men in China. Forbes estimates his net worth at around $11 billion, while Bloomberg gauges it at more than $21 billion.
Key executives working for Sky Xu
Xu had two early cofounders at Shein: entrepreneur Wang Xiaohu, who owned 45 percent of the company, and Li Peng, a consultant with a 10 percent stake. According to a Wired feature last year, Xu abruptly dropped both of them in 2011 when he decided to rebrand the business as a wedding dress retailer called Sheinside. Wang and Li showed up at their shared office one day, only to find Xu had disappeared, but not after changing the company passwords and taking control of the company’s PayPal accounts. Shein has pushed back on these claims.
Understanding Shein’s current executives is crucial to understanding the company. Though Xu doesn’t give interviews, other key people, including executive chairman Donald Tang and vice chairman Marcelo Claure, have commented when the company faces scrutiny.
Tang, who joined Shein last year, is a front-facing figure regarding the company’s controversies related to its contribution to pollution and the use of forced labor. When Shein faced backlash in June for sponsoring an influencer brand trip to one of its factories in China, Tang sat for an interview with Time to defend the company’s decision.
Claure, a billionaire investor and the former CEO of Sprint, joined Shein in January as chairman of its Latin America division. Claure was promoted to global vice chairman in October. He has publicly denied allegations of forced labor, telling CNBC that there is “no such thing as forced labor” in the Shein factories he’s visited, even though the company acknowledged the problem and said it was taking steps to fix it.
Shein’s secret success formula
Shein owes much of its success to influencer marketing. It is the most popular brand for clothing hauls on TikTok, according to a report by advertising platform Illumin. The hashtag #sheinhaul, where creators often show off entire boxes of cheap items purchased from the site, has 14 billion views on TikTok. The #shein tag, with which users post all Shein-related content, has about 80 billion views on the platform.
Despite Gen Z being climate conscious, young people love Shein. The brand is also popular among millennials (the average Shein customer is around 35 years old). Shein has gained popularity among influencers by sending them free clothing and offering discount codes on top of its already low prices. Shein’s website is constantly uploading new products. On any given day, the brand has as many as 600,000 items available for purchase.