The once-prominent Malaysian e-commerce site has struggled financially in the past years, incurring the chagrin of their supporters. Its founders recently took to Instagram to “take full responsibility”

Screen shot of the new FashionValet homepage, headed as the FVGroup

At its founding in 2010 by Fadzarudin Anuar and his “blogger-to-entrepreneur” wife Vivy Yusof, FashionValet was considered a pioneer in the fashion e-commerce space. Today, they are still referred to as Malaysia’s “OG start-up”. Some even consider them Southeast Asia’s. Their self-professed “failure” shared on IG yesterday, therefore, was mind-blowing even if it was expected. In a two-page response to “recent coverage of FashionValet”, the couple said: “we felt it is important to make a statement in our personal capacity as founders of the business.” And they added that they desired to “take full responsibility for the failure of the investment” and for “failing our investors”. For the remorse to be more palpable, the pair also said, “we are disappointed in ourselves and regretful that it has come to this. We are truly sorry.” Both said they will “step away from the business”, but no mention if they are still shareholders.

What has FashionValet really come to? According to many news reports that have emerged in the last few days, the company has chalked up losses for the past three consecutive years. In 2022 alone, to the tune of RM34.51 million (or about S$10.45 million). That was reportedly more that triple what was recorded the year before. According to Mr Anuar and Ms Yusof in that IG post, the losses were due to their attempts at expanding their business “too aggressively” and failure to “sufficiently plan for a rainy day”. That, to many observers, meant that the couple were too inexperienced and had not considered the many twists and turns that potentially lay ahead for their business. As one marketing consultant commented to us, it was a “classic case of accelerated expansion with scant market insight”.

What has FashionValet really come to? According to many news reports that have emerged in the last few days, the company has chalked up losses for the past three consecutive years. In 2022 alone, to the tune of RM34.51 million (or about S$10.45 million)

In their first decade, FashionValet was a platform on which third-party—largely Malaysian—brands availed their merchandise, mainly modest wear. The business model was akin to, say, Zalora’s. But in 2022, the couple decided to shut down the multi-label platform to concentrate on two of their own jenama (brands): Duck and Lilit, launched in 2014 and 2019 respectively. Both came under a rebranded FVGroup, with Mr Anuar as the CEO and Ms Yusof as the creative director. Although it is not unreasonable to assume that both share equal importance as married-couple-in-their-own-business, it seems Ms Yusof enjoyed visibility that was more far-reaching, as she set herself as the face of her brands. In fact, with an IG account (on which she shares every aspect of her private, professional, and religious life) followed by 1.8 million fans and customers, she continued to play the influencer that she became, not the mere blogger that she was at the beginning, when she started her now-defunct blog page Proudduck (hence the name of one of her brands).

Through the years since the launch of FashionValet, Ms Yusof was a media darling. She was frequently amenable to interviews and was happy to appear on magazine covers, looking the epitome of modest-fashion savvy. She published a “best-selling” autobiography (with a photograph of her on the cover); she had even her own reality TV show Love, Vivy (from which she augmented her personal branding; in one episode, she even showed herself go through the ritual of a photo shoot) in 2015, “to promote the business”, she said in a 2023 podcast. Some commentators believed that it was the recognisable factor that led to her company’s pronounced profile, as well as its ability to attract investments from state-link firms. In some ways, her trajectory reminded us of Elizabeth Holmes’s—rewards from immense publicity rather than results from discernible acumen.

Co-founders of FashionValet, Vivy Yusof and her husband Fadzarudin Anuar. Photo: fadzaanuar/Instagram

In that autobiography, The First Decade: My Journey from Blogger to Entrepreneur, Ms Yusof wrote: “Choose to see potential and bulldoze through, instead of only seeing problems and complaining.” She took her own advice seriously. By 2014, the company was ready to open physical stores, with the first in Bangsar Village II. That year, revenue more than doubled to RM7.9 million. By 2022, she had 14 stores in all, and sold more than 3 million Duck scarves. Her husband, Mr Anuar, boldly told The Edge Malaysia in 2017: “Our goal is to try to be like the LVMH of Southeast Asia.” In 2022, Ms Yusof was included in the BOF 500. The citation read: “One of the modest fashion industry’s most influential voices in Southeast Asia, she has embarked on a global expansion to develop ‘go-to-brands’ for the sector.” It is not certain that goal is met.

FashionValet was thought to be so bankable that in 2018, two firms linked to the Malaysian government, Khazanah Nasional Berhad and Permodalan Nasional Berhad invested RM27 million and RM20 million respectively in the company, totally RM47 million. At the end of 2023, they sold their minority stakes for just RM3.1 million to local investment firm NXBT Partners. The transaction has been described as a “fire sale”. The loss, even to a casual observer, was massive, but the Malaysian finance ministry had, according to Malaysian media, described it as “negligible, compared to Khazanah’s and PNB’s overall income for the relevant year”. Prime Minister Anwar Ibrahim, who is chairman of Khazanah, has asked for an internal audit into the investment. Three days before that statement of apology, Vivy Yusof wrote on her socials of what was becoming a scandal; “There is too much that I want to share but for now, I will allow people to say what they want to say.” Many, in disdain, did, without requiring her permission.

Update (4 November 2024, 19:00): The New Straits Times, in their latest reporting, shared that “Fashion Valet posted losses 5 straight years before Khazanah, PNB investment”. Financial filings made between 2012 and 2017 apparently showed that the company’s “losses widened to RM10.7 million in 2017 from RM166,793 in 2012, prior to Khazanah and PNB’s investment in the company in 2018” . In addition, it is reported that the Malaysian Anti-Corruption Commission has raided four FashionValet premises