Rocket Internet continues to bring in money for its various e-commerce businesses, but things are definitely not looking great for its companies. On the heels of Alibaba investing in its Amazon clone Lazada, today the Berlin-based incubator announced that Global Fashion Group, the company’s unprofitable merged fashion businesses, raised another €300 million ($340 million). Rocket itself is putting in €100 million at a €1 billion ($1.1 billion) valuation. But this is not a prancing unicorn: it’s a significant down round. Last year, GFG raised funding at $3.45 billion valuation.

In a statement, Rocket said that it would be investing alongside other existing shareholders. These include Rocket regulars Kinnevik and Access Industries. The GFG includes Dafiti in Latin America, Lamoda in Russia and CIS, Namshi in the Middle East, The Iconic in Australia, Jabong in India and Zalora in South-East Asia. (This also gives some context to last week’s news that the unprofitable Zalora business was looking for buyers of some of its operations: the company is trimming less profitable operations ahead of the funding round to put itself in a better position for profit.)

The company’s execs continue to show optimism in the face of the challenging environment to create profitable e-commerce operations around the fickle fashion market in emerging economies.

“We continue to be very excited about the prospects of GFG, which has successfully built out leading market positions in key emerging markets. We are looking forward to continuing to work with the GFG team as well as Kinnevik and the other GFG shareholders to support GFG,” said Oliver Samwer, CEO of Rocket Internet, in a statement.

“We very much appreciate the continued support of our key existing investors in GFG. The financing will provide GFG with the necessary capital to continue to execute its strategy of building out its leading position in the online fashion sector in emerging markets. During the first quarter 2016 we have made significant progress on our path to profitability, reducing the loss from operations meaningfully in comparison to the first quarter 2015 resulting in an improvement of the Adjusted EBITDA margin by over 10 percentage points year-over-year. This is in line with GFG’s plan to deliver an accelerated path to profitability across its regional businesses while continuing to capture the significant market opportunity available,” said Romain Voog, CEO of GFG.

More to come.

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