Faire co-founder and chief architect Marcelo Cortes argues that his company, a privately held online wholesale marketplace based out of Kitchener-Waterloo and San Francisco, has the numbers of “a very good public company,” but he won’t say when it might make the leap.
Cortes said market conditions would need to be aligned for Faire to consider an actual IPO.
“Metric-wise, we’re in a very good spot,” Cortes told BetaKit in an interview. However, he emphasized that market conditions would need to be aligned for Faire to consider an actual initial public offering (IPO)—and at the moment, the IPO market for new tech issuers remains cool.
Faire, which helps local retailers with physical stores find products from independent brands, has just given Canadian brands access to its first wholesale advertising product, Promoted Listings—one of the company’s fastest-growing offerings. Since Faire launched Promoted Listings just over a year ago in the United States, more than 10,000 brands have used the product and it has grown to account for five percent of the firm’s total sales.
Cortes indicated that the company is back on solid ground after a “rollercoaster” six-year period that saw the firm secure over $1 billion USD ($1.4 billion CAD) in funding during a short span amid rapid pandemic growth. This was followed by a market downturn that included some pain for Faire as the firm restructured, shedding staff and slashing its valuation internally.
Since then, things have begun to stabilize: Cortes claimed Faire sits “in a very good and efficient place,” although Canada’s ongoing trade war with the US remains a concern.
Last week, Faire kicked off a process for some of its employees to sell shares in the company for cash as part of a tender offer at a $5.2-billion valuation, which marks a far cry from the $12.4-billion it was once valued at in 2021 during the peak of the COVID-19 tech boom.
This secondary deal is being led by new American backer WCM Investment Management, with participation from existing UK investor Baillie Gifford and new Kitchener-Waterloo-based backer True North Fund. Bloomberg has reported that the deal is expected to be for about $100 million, but Cortes said the size remains to be determined, as it depends on how many decide to sell.
Faire under “no pressure” to raise capital
The continually cool IPO market has driven global secondaries to new heights. Many later-stage Canadian tech companies have turned to secondary deals as a means of giving founders, employees, and early backers liquidity. It also ensures they have the flexibility to stay private for longer and continue building towards larger outcomes. Some examples since 2024 include 1Password, Clio, Fispan, Jane Software, Safe Software, and Wealthsimple.
Cortes said Faire’s goal with this transaction was to give longstanding staff an opportunity to get some liquidity. He noted that it also helps the company solidify its valuation with external investors after a 2023 writedown to $5 billion, and brings on new backers as the firm inches towards a potential IPO.
Cortes said Faire is under no pressure to raise any additional capital at this time as the company still has approximately $500 million of the $1.5 billion it has raised to date left in the bank.
Faire revealed last week that it is generating more than $500 million in revenue on an annualized basis, serves hundreds of thousands of brands and retailers, and expects to hit nearly $3 billion in gross merchandise value during 2025.
Cortes says Faire has clocked accelerated growth over the past eight quarters, including more than 40 percent year-over-year growth in Q3, something it hopes to maintain going forward. He said Faire is also nearing profitability as it targets a cash flow breakeven in Q4.
The co-founder pointed to this data when arguing that Faire would make a compelling public company, but said Faire was concentrating on its work in the meantime. “Our goal is to keep executing … assuming that all the things aligned, it could happen at some point in the future,” Cortes said.
For his part, Faire CFO Jason Lee told Bloomberg he expects that Faire could have an IPO option in 2026 or 2027, but emphasized that the company intends to “be very deliberate about it.”
The Promoted Listings offering that Faire has brought to Canada allows brands using its platform to pay to boost the visibility of their products to retailers on a per-click basis. Through Promoted Listings, Cortes said Faire uses artificial intelligence to match the right brands with the right retailers towards the goal of establishing a relationship with “a much larger [return on investment] long term.”
“We don’t want to just be showing their products to any retailers,” Cortes said. “Our goal on wholesale for a brand is to make a new connection. Retailers look for brands that resonate [within] their stores, and once they find those brands, they start with one product, and if that product [sells] well … they keep adding more products from the same brand.”
Cortes said Promoted Listings has already become an important part of how brands can grow on the company’s platform.
A Brazilian immigrant who fell in love with Canada, Cortes joined The BetaKit Podcast earlier this year to unpack how he has tried to bring Silicon Valley DNA up north, where Faire’s engineering team is largely based and more than 300 members of its 900-person workforce are located. The company continues to grow in Canada with over 20 open roles currently across its Kitchener-Waterloo and Toronto offices.
Feature image courtesy Faire.