Just days after the bankruptcy of Thrasio, two significant players in the world of e-commerce aggregators are merging and raising additional funds to strengthen their business. Berlin’s Razor Group has acquired U.S.-based Perch and has raised over $100 million, led by Presight Capital with other undisclosed investors participating.
Key Takeaway
Razor Group’s acquisition of Perch and the subsequent fundraising of
00 million on a
.7 billion valuation reflects the ongoing consolidation and reordering in the e-commerce aggregation space. The move highlights the challenges and opportunities in the industry, as well as the continued investor interest in backing aggregators despite operational difficulties.
Consolidation in E-commerce Aggregation
The combined business now has an enterprise value of $1.7 billion, with approximately $400 million of debt on its books not due for payback for at least another four years. This move is part of a wider consolidation and reordering in the world of e-commerce aggregation. Perch had been seeking a buyer for the better part of a year, while Razor has been gradually acquiring smaller aggregators like Stryze and Factory 14. The industry is witnessing a trend of mergers and acquisitions.
Challenges and Opportunities
The business model behind e-commerce aggregation appears strong on paper, with millions of retailers selling on marketplaces like Amazon. However, challenges lie in merging operations cost-effectively and moving ahead on single platforms. Despite these challenges, investors continue to back aggregators, drawn by the potential for better economies of scale and new avenues for product development and sourcing.