Farfetch has raised $250 million by selling convertible senior notes to Tencent and Dragoneer.

Chinese tech giant Tencent purchased $125 million of the notes, while San Francisco-based investment firm Dragoneer bought the remaining $125 million, with the funds being used to execute its growth plans, including moves into the Chinese market, and driving towards operational profitability.

The financing will supplement Farfetch’s current liquidity position, which as at 31 December equated to approximately $320 million in cash and cash equivalents.

Tencent’s investment continues the two companies’ partnership, through Farfetch’s role as a luxury retail gateway to China has helped western brands reach the Chinese consumer through the WeChat platform. Farfetch currently powers more than 80 luxury brands on WeChat, including Moncler, Balenciaga, Saint Laurent, Armani and Ralph Lauren.

José Neves, Farfetch founder, chief executive and co-chair, said: “Tencent’s deep technology expertise and ongoing relationship with Farfetch, paired with Dragoneer’s expertise in supporting growth-oriented technology companies, makes both investors outstanding partners to support Farfetch’s next chapter of growth.

“As we continue to execute on our long-term strategy, we believe that this investment supports Farfetch in delivering on the significant opportunity we see and scaling our business to achieve profitability in the medium term.”

Founded in 2007 by Neves and launched in 2008, Farfetch began as an e-commerce marketplace for luxury boutiques. Today, its marketplace connects customers in 190 countries with items from more than 50 countries and over 1,200 brands, boutiques and department stores.

It has branched out to Farfetch Platform Solutions, which services enterprise clients with e-commerce and technology capabilities; Browns and Stadium Goods, which offer luxury products to consumers; and New Guards Group, a platform for the development of global fashion brands.

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