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The rise of e-commerce roll-ups
In the past, roll-ups were mainly proceeded by private equity firms, large conglomerates, and institutional buyers whereby companies acquire businesses in the same market and merging them under a single entity to scale.
Today, there are new companies that consolidate independent private label brands with decent revenue. They are the aggregators of e-commerce brands. Unlike marketplaces that connect buyers and sellers to acquire or sell off their brands (e.g. Flippa and Exchange Marketplace by Shopify), roll-up platforms are operational and resourceful. They:
- have a thesis around e-commerce product categories they want to acquire
- search across marketplaces like Amazon and Shopify
- find winners and merge these companies
- operate like a private equity firm, may fund and invest in buyout businesses
- platform-agnostic or vertical-focused
- grow them collectively using built-in technology, infrastructure, data analytics, operational expertise, capital, and economies of scale
- (📥 Full version) 3 more specific strategies on how aggregators operate and scale
Key players around the world
- Amazon-focused aggregators: Thrasio (made $100 million in profits, acquired more than 100+ brands), Heyday, Perch, and Branded
- Shopify aggregator: OpenStore
- Home living & consumer electronics roll-up: Berlin Brands Group
- Asia-Pacific focused consolidator: Una Brands (raised US$40 million) targets acquisition on Tokopedia, Lazada, Shopee, and Rakuten using a platform-agnostic approach by focusing on Shopify, Magento, or WooCommerce.
- (📥 Full version) 1 more company that focuses on the Amazon platform
- (📥 Full version) 5 more companies from emerging market