Girls' flea market makes a loss of 2.4 million euros

The start-up presents its business figures for 2020. They also include a loss not covered by equity.

The troubled second-hand platform Mädchenflohmarkt has quietly and secretly published its business figures for 2020 - and they don't look rosy at all. According to the figures published in the Federal Gazette, the start-up reported a net loss of 2.4 million euros, which is significantly more than a year ago. Back then, the start-up had to cope with a loss of 1.6 million euros according to the balance sheet.

This is yet another setback for the company, which once started with great ambitions but has attracted attention in the past with late payments and problems, as Startbase has already reported several times. According to its website, Mädchenflohmarkt actually wants to pay sellers as soon as customers have received their product and confirmed that everything is in order. Mädchenflohmarkt acts as a kind of trustee so that buyers and sellers can complete the transaction as securely as possible and collects a commission of ten percent. In the past, however, many users complained that the money was paid out very late or not at all. Mädchenflohmarkt initially explained this by saying that they had to fend off fraudsters, but later the start-up blamed it on internal accounting changes and promised that everything would soon be back to normal. However, users are still waiting for their money, as they write on Trustpilot .

The new figures now show an uncovered shortfall for the start-up. This occurs when the accumulated debts are greater than the assets of a company. In accounting terms, this is referred to as a deficit not covered by equity. In 2019, Mädchenflohmarkt did not yet have this deficit, but in 2020 it had a deficit of 2.1 million euros. So does the start-up have much bigger problems than previously thought?

In 2021, the company still claimed to have reached break-even. The notes to the annual financial statements also state that the management is planning for a "sufficient liquidity position between August 2022 and December 2023". The company is assuming "rising sales revenues due to the current trend towards sustainability" and inflation. The reasoning: If everything becomes more expensive, more people will turn to second-hand clothes.

However, it is by no means certain that these developments will occur. The annual financial statements state the following about this liquidity situation: "However, this assumes that the assumptions underlying the liquidity planning with regard to sales and the cost reduction expected as a result of the restructuring will actually materialize." If there is a "significant deviation from the assumptions", "the company will be dependent on additional financing from the company." In plain language, this means that if Mädchenflohmarkt does not manage to increase sales and reduce costs at the same time, the start-up from Stuttgart will probably soon need new money from its shareholders.