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The fashion creator economy has a new unicorn

LTK, formerly rewardStyle and liketoknow.it, raised $300M for its fashion influencer marketing platform.

LTK's new funding will open up new opportunities for indie hackers and creators in fashion, fitness, content, and home decor.

The news: SoftBank’s Vision Fund 2 dished $300M to LTK, valuing the firm at $2B. The Dallas-based company created an influencer marketing platform that connects content creators, brands, and shoppers.

LTK 101: LTK’s shopping app is similar to Instagram Shop, offering users a visual feed through which to scroll and a simple means to purchase clothing, fitness products, home decor, accessories, and more. Brands on LTK set their own commission rates and creators typically earn between 10% and 25%. LTK takes a cut from the brand’s sales. The company has 350 employees across the globe and works with more than 5,000 retailers and 1M brands.

LTK’s influence: LTK dubbed itself as the pioneer of the creator economy, spurring the influencer marketing strategy as we know it back in 2011. In 2020, consumers purchased more than $3B in fashion, beauty, fitness, home, and lifestyle products from LTK creators via the company’s e-commerce platform, creators’ shops, blogs, and social media.

Minting millionaires: LTK co-founder and president Amber Venz Box said that LTK has propelled at least 130 influencers to become self-made millionaires through the platform. Retailers have spent more than $1B in influencer marketing campaigns on the platform in 2021 alone, the company reported.

Speaking of millionaires: LTK’s wild success and Softbank’s funding has made Venz Box one of the United States’ richest self-made women, per Forbes. Forbes estimates the 34-year-old’s net worth is about $315M.

Live-shopping next? Many social platforms — from Instagram to Facebook to Pinterest — are launching live shopping features. That’s because live shopping, also known as social commerce, generates more than $300B a year. Don’t be surprised if LTK follows suit with its own live offering.

Fashion is big: The global fashion and textiles industry is worth $3 trillion, per Fashion United’s annual report. That corresponds to 2% of the world’s gross domestic product.

Creator confusion: We’ve discussed before how amorphic the creator economy is and how difficult it is to quantify. For example, is an indie developer part of the creator economy, and should their SaaS revenue be tallied as such? Many researchers analyzing the creator economy say no. Others, like Matt Rickard, disagree. Regardless, you can see how hazy our shared understanding is.

Influence is valuable: Despite the nebulous nature of the $100B creator economy, fashion and beauty may be among its most lucrative segments. Some of the top fashion influencers — like Julie Sariñana (6.3M followers on IG) and Kayla Itsines (13.6M followers on IG) — make more than $150,000 per sponsored post. The Hustle recently reported that in October a Chinese internet star known as “The Lipstick King” sold $1.7B during a 12-hour live stream.

Influencer marketing: Influencer Marketing Hub estimates brands will spend about $13.8B on influencer marketing in 2021 — up from $9.7B in 2020.

Trends in bloom: The influx of spending on influencer marketing confirms an important trend that SignalFire is watching in the creator economy. Creators are gaining power in the media ecosystem as more fans aim to connect with “individual personalities rather than faceless publishers,” per SignalFire.

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