Venture Capital: Thrasio Nabs Another $750M To Acquire Amazon Merchants
Thrasio raised $500 million of senior debt just last month.
Thrasio, which claims to be “the fastest profitable U.S. company to ever reach a $1 billion valuation,” announced Tuesday its equity fundraise of another $750 million received almost entirely from existing investors including Oaktree and Advent. The company said the money will further boost its acquisitions of FBA (“Fulfilled By Amazon”) sellers on the Amazon (NASDAQ: AMZN) marketplace. (CISION PR Newswire)
FT said its calculations based on company disclosures showed the latest round valued Thrasio at over $6 billion.
By its own admission, the company said the equity raise diluted existing shareholders by only 11.1%. To date, the startup has raised more than $1.75 billion in total funds. It said in a statement that it is now sitting on over $1 billion of cash.
Thrasio’s FBA roll-up business
Thrasio’s business model revolves around acquiring (“rolling-up”) small, third-party merchants and brands that sell on Amazon. Being essentially companies run by one, or two founder owners, they rely heavily on Amazon’s FBA infrastructure for deliveries.
After the acquisition, Thrasio improves these businesses by adding capabilities the implementation of which would have been daunting for the founders. These include a global supply chain, marketing, an in-house creative team, legal support, and operations management.
The model has been highly successful. To date, Thrasio has evaluated about 6,000 Amazon sellers, acquired nearly 100 top-rated brands, and scaled nearly 14,000 category-leading products.
“Thrasio continues its exceptional growth,” said co-founder and co-CEO Joshua Silberstein in a statement. “Over the past two months, we’ve been acquiring $1.5 million in revenue per day. Thrasio is now closing two or three deals every week.”
On its website Thrasio says of its acquisition prowess: “We close on 98% of our term sheets and have paid 94% of our earn-outs. Our unmatched experience makes us the fastest route to a fair-market evaluation and offer.”
Use of funds
Apart from stepping up its acquisitions, Thrasio is already rapidly expanding across the globe. It is hiring around 30-40 people a week and has set up hubs in Germany and the UK.
Would it raise still more capital?
Co-founder and co-CEO Carlos Cashman responded: “In ten years, omnichannel retail will be the backbone of the entire consumer products ecosystem – but today, it’s still in its genesis. Every day, the very fabric of this market is twisting as it continues to evolve. Our balance sheet isn’t built to win yesterday’s battles – it is designed to pursue the accelerating opportunities that accompany these kinds of seismic changes in an industry.”
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