As Amazon's store acquisition war heats up, Berlin Brand Group receives another $240 million in financing

According to foreign media reports, Berlin Brand Group (BBG), a company focused on acquiring and growing Amazon third-party sellers’ stores, has successfully raised $240 million. The financing mainly came from UniCredit, Deustche Bank and Commerzbank.

The funds raised by BBG will be used to continue acquiring smaller but more promising third-party seller stores on e-commerce platforms such as Amazon in Europe and North America (especially the United States), with sales of these stores ranging from US$1 million to US$100 million.

It is reported that BBG has invested $300 million in the acquisition and operation of third-party stores on the platform earlier this year. Through this round of financing, BBG has invested a total of $540 million in this business.

BBG founder and CEO Peter Chaljawski said BBG is likely to raise an equity round in the near future.

The opportunity for companies like BBG is that many smaller but promising stores have not established long-term development plans. Sellers may not be ready for the scale, investment and operation required to maintain their business, or they simply have no interest. BBG's selling point is to do what these small and medium-sized sellers cannot do.

In order to search for suitable stores, BBG has a dedicated data team that builds algorithms to track millions of products and hundreds of thousands of sellers. The generated data is used to find potential acquisition stores and operating businesses.

To date, BBG’s business has been centered around acquiring and growing third-party private-label brands on platforms like Amazon. Some of the brands BBG has acquired include Klarstein (kitchen appliances), AUNA (home appliances and audio equipment), Capital Sports (home fitness), and blumfeldt (gardening supplies).

BBG also said it has 1.3 million square feet of warehouse space in Europe, Asia and the United States and is one of Amazon's largest sellers in Europe.

In the battle of acquiring third-party stores on e-commerce platforms, in addition to BBG, there are also leaders such as Thrasio. Thrasio is one of the largest and earliest companies in this field. So far, the company has acquired and integrated more than 100 brands on Amazon, such as Vybe massage guns, Circadian Optics strong light therapy lamps, etc. Other companies in this field include SellerX, Heyday, Heroes and Perch.

It is estimated that there are about 5 million third-party sellers on Amazon, and this number is still growing. Due to the impact of the epidemic and other factors, more than 1 million sellers entered Amazon last year alone. Thrasio estimates that there may be 50,000 stores using FBA services on Amazon with annual revenue of more than $1 million.

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