Lyst is expected to announce the launch of a funding round this week with luxury group LVMH acting as its largest investor.
According to Sky News, the Fendi, Louis Vuitton and Dior parent company is poised to spearhead a multimillion-pound cash injection into Lyst.
Although details of the capital raising are still unclear, it is understood that the online fashion platform will be seeking between £50 and £100 million.
The news of LVMH’s backing comes a month after it revealed a new investment programme, which would see it invest in fashion and technology startups.
During its previous funding round in 2015, LVMH’s controlling shareholder Groupe Arnault was a key investor.
However, it is understood that this time around, LVMH is leading the investment drive directly.
The move has sparked speculation that LVMH may seek to absorb the young fashion retailer, which now boasts 70 million annual users, in the future.