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Where the money is
Investment dollars in e-commerce flowed east and west over the last two years, with U.S. and Chinese e-retailers accounting for most of the value. Top500Guide.com data shed light on how the capital flowed and which retailers received the most funding.
Topics: 360Buy.com, Alibaba, Asia 500, China e-commerce, Dafiti, Europe 500, Fab.com, Fanatics, investment activity, jingdong mall, Latin America 400, NetShoes, Temasek Holdings, Tencent, Top 500 Guide, Top 500 Insider, Top500Guide.com
E-retailers in the United States and China accounted for 65% of the value of the 20 largest investments in online merchants in 2012 and 2013.
The top 20 largest investments in companies engaged in e-commerce totaled $2.83 billion, according to publicly announced investment activity tracked by investment bank Petsky Prunier LLC and analyzed by Top500Guide.com editors. The top 20 also excludes acquisition activity.
U.S.-based e-retailers accounted for $1.005 billion, or 35%, of the investment total, and China-based e-retailers accounting for 30% ($855 million) of the total. E-retailers in Brazil accounted for 16% of the investment dollars ($456.9 million). E-retailers in Germany accounted for 7% ($183.2 million), and e-retailers in other countries (Russia, Malaysia and Indonesia) collectively accounted for 12% ($330 million).
360buy.com was the beneficiary of the two largest e-retail deals announced in 2012 and 2013, with the two deals totaling $800 million. The Chinese marketplace, which has been renamed as Jingdong Mall with the web address JD.com since the investment, is the second-largest marketplace operating in China and nearly doubled its sales from 2011 to 2012. According to Top500Guide.com, it generated $4.96 billion in sales in 2011 and $9.63 billion in 2012. It reported its first profit in Q3 2013.
A funding round led by Singapore-based investment firm Temasek Holdings netted Brazil’s Netshoes $321.9 million. Netshoes is an online footwear retailer with e-commerce sites selling to consumers throughout Latin America, including country-specific sites for Brazil, Argentina and Mexico. With $591.5 million in 2012 sales, Netshoes is the No. 4 e-retailer in Latin America by 2012 sales, according to Top500Guide.com. Also based in Brazil, fast-growing shoe and apparel e-retailer Dafiti Group raised $135 million in two investment rounds. Dafiti is the No. 31 e-retailer in Latin America by 2012 sales.
The U.S. e-retailers ranked in the Top 500 Guide garnering significant investment dollars were Fanatics, which in two top 20 deals raised $320 million, and Fab.com, which raised $225 million also in two top 20 deals. Two of these four investment rounds were led by investors hailing from China. Alibaba Group, operator of China’s largest e-commerce marketplace, and the previously mentioned Temasek Holdings, led the larger of the two funding rounds for Fanatics, which sells licensed sports apparel and is the No. 41 North American e-retailer by 2012 online sales, according to Top500Guide.com.
Tencent Holdings, the investment arm of one of China’s largest Internet service providers and which operates popular web services like instant messaging service QQ, led the larger of Fab Inc.’s two rounds. Web-only Fab.com, which sells a variety of merchandise, including art and home décor, burst onto the scene in 2011 and grew sales lightning-fast, reaching an estimated $150 million in 2012, its first full year in business, according to Top500Guide.com. In 2013 Fab.com moved away from the flash-sale model of selling that begat its fast success and now follows a more traditional sales model. In the process, one of its co-founders left the company and Fab.com laid off some 200 employees globally.