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Farfetch’s dramatic sales growth slowed some in the fourth quarter as it backed off price promotions — but José Neves, founder, chairman and chief executive officer, is keeping his foot on the accelerator. 

The platform is starting to build in China with a soft launch for its mega partnership with Alibaba and Compagnie Financière Richemont. It is also laying the groundwork to enter the beauty category next year and is generally focusing on being “the platform” for the nearly $300 billion luxury industry.

Farfetch’s revenue expanded 41.3 percent to $540 million for the quarter ended Dec. 31, driving a gross merchandise value of $1.1 billion through its platform. That marked something of a deceleration as sales for the year grew 63.9 percent to $1.7 billion, producing a gross merchandise value of $3.2 billion. 

But the company chalked that up to fewer promotions and the timing of when new merchants joined the platform. The business is expected to accelerate again this quarter — a trend that will be supercharged when Farfetch officially launches on Alibaba’s Tmall next week, opening a huge online market for the many brands on the platform. 

Farfetch is planning for the growth in its gross merchandise value to rise from 49 percent last year to 50 to 55 percent in the first quarter. 

Neves told WWD that he’s expecting Farfetch’s move onto Alibaba’s Tmall to create something like a slow burn as his team gets experience navigating a new shopping ecosystem. 

But the potential is huge, plugging smaller brands for the first time into a massive market that the bigger names are already tapping into. 

Neves said: “What excites me the most is that here are 3,500 designers, 95 percent of which did not have a store on Tmall, a very similar percentage did not have any e-commerce operation in China — from Monday, they will be live in what is the biggest store on the planet. Period. These are 779 million shoppers that will be able to browse in real time, the fashion they used to buy in Milan, Paris, New York when they were traveling around.”

It’s a meeting of two worlds that will take some time to settle in. 

“It’s very early, these channels are very sophisticated,” Neves said. “To sell on Tmall involves media spend, these platforms, they are a Google and an Instagram inside an Amazon. Just because you have a shop does not mean you maximize your traffic.”

But it is Neves and his team, including 500 people in Greater China, who are going to have to figure out the nuances there, bidding for exposure and better play on Tmall and not the brands. 

“They don’t have to do anything,” Neves said. “But we have to go through that learning curve.”

And sounding a note of obvious pride, the CEO noted, “this is not something that just any company could do” and that Farfetch is well suited to the challenge. 

So on Monday, Farfetch will start on Tmall to “test and fail and learn,” Neves said.

“It will be a slower build up than what some people expect,” he said. “It won’t be a big bang on Day One, but of course, we’re very bullish.” 

Neves’ bullishness has taken him this far and he’s not letting it go, or letting go of his original plan for Farfetch — a plan that it’s taken the industry time to fully digest as it cuts across e-commerce, technology and physical stores (with a connected approach).

“The vision was always to be an operating system for the industry, a technology partner and we really think we will be the digital enabler that will help this industry thrive,” Neves said. “The only question that matters in my opinion is, ‘How will people shop for luxury fashion in five to 10 years’ time?’ All the other questions are distractions.”

He said 35 percent of sales will be online, but that 65 percent of sales will still be in stores. 

To help capture that side of the business, Farfetch built a connected retail concept with Chanel that is now available to others and being applied to Farfetch’s Browns retail business. 

It’s a lot to digest and investors took a step back, pushing shares of Farfetch down 8 percent to $58.74 in after-hours trading Thursday. 

But the company is still massively ahead in the stock market. A year ago, Farfetch’s stock was trading at $10.17. At that time, the market was in wait-and-see mode evaluating the company and its evolving model, which included adding its own brands — and inventory risk with the New Guards Group — to the platform. 

Paradoxically, the company’s stock price has been so strong, it hurt the bottom line by prompting a $1.9 billion in noncash fair value loss on its debt load. 

So net losses for the quarter tallied a mammoth $2.3 billion — on paper — compared with losses of $110.1 million a year earlier. Losses for the full year were $3.3 billion.

Farfetch focused instead on its first quarter of adjusted earnings before interest, taxes, depreciation and amortization — a hurdle it’s been promising to clear for some time. Adjusted EBITDA totaled $10.3 million in the quarter, a sharp turnaround from losses of $17.9 million a year ago.

Losses per share tallied 6 cents in the quarter, much better than the 34 cents analysts had penciled in. 

Whatever doubts investors had a year ago — many worried over its jump into the brand business with the purchase of Palm Angels owner New Guards Group — eased as Farfetch demonstrated the power of its platform and wrapped Alibaba and Richemont into a partnership (with the backing of Kering chief François-Henri Pinault’s Artemis). 

And there’s also a substantial push into beauty in the works. 

On a conference call with analysts, Stephanie Phair, chief customer officer, said, “We’ve been thinking about this [beauty initiative] for a while and we really want to launch a full proposition end to end and really think about it in a new way. This is not just about launching an adjacent category.” 

Farfetch plans to use the nuances of its operations to approach beauty in its own way, building with a “multiyear roadmap.”

Phair said consumers “want to shop the full look” and that Farfetch, as a platform, is well positioned to tap into innovations that beauty is putting to work, such as augmented reality.

“That’s something Farfetch can really play into,” she said. “Because we’re a platform, we’re also able to pull in incredible innovation with start-up partners, which really keeps us up to speed.” 

While Farfetch is a business that is very much of the fashion world — connecting small boutiques with online customers, ranking as a retailer itself by owning Browns and consumer obsessed — it also has a high-tech heart. 

And that means constantly fiddling, tweaking services and adding new features. The platform is by nature modular so new functionality can be plugged in easily. 

The latest update is a link up with Wishi, which borrows a page from Stitch Fix, and offers shoppers fashion recommendations that are vetted by AI and human stylists. 

The new service, which is in pilot, offers some of the flavor of Farfetch’s high-touch Private Client program, but at scale. 

Scale is in many ways the name of the game for Farfetch, which is emerging as a vital e-commerce link for luxury — a world that for years scorned the web, but is now embracing it fully. 

Farfetch might have some big friends as it takes on luxury, but it doesn’t have high-priced clicks to itself. The newly public Mytheresa said it saw a 28.2 percent rise in active clients last quarter, to 569,000, and Revolve said this week that it would be investing more in its high-end Forward business.

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