2020 was the year a new kind of business was born: Amazon seller acquisition companies. The business model of these ecommerce aggregators revolves around acquiring successful Amazon sellers and then scaling them up. In Europe, there are several companies focused on Amazon Marketplace seller acquisitions.
FBA acquirers and ecommerce aggregators
There are currently more than 70 confirmed acquirers of marketplace brands. In the last 3 years, over $10 billion of funding was raised. But thats just a start because on Amazon alone, there are 35,000 of Amazon FBA brands with more than $1 million in revenue. That huge fragmentation and the big number of attractive sellers presents the opportunity for aggregation.
This is gaining momentum fast. In November 2020 for example, both Heroes and Razor raised tens of millions of euros (respectively 55 million and 25 million euros) to acquire and scale Amazon brands. In 2021, the US-based company Thrasio expanded its budget to grow across Europe, Berlin Brands Group invested 250 million euros, and FBA acquirer Branded raised 124 million euros.
How the business model of these acquirers works
Then the acquisition company takes on the acquired Amazon brand and make it its own by appending some changes. It puts each product through a compliance check, so it won’t get in trouble later. And most of the time, the products will be sold for lower prices than before. That’s possible, because these acquisition companies have the resources to buy in bulk and make better contracts with manufacturers. Some acquisition companies also changes the product’s appearance on Amazon, by shooting new product photos, rewriting the listing or even redesigning the packaging.
Are you considering selling your online store or marketplace account? Are you looking for advice on the valuation or on how to find the right buyer? www.businessforsale.eu can help you with the entire process.
How to get acquired by an aggregator
Not every Amazon seller will be attractive enough for Amazon seller acquisition companies or FBA acquirers. You might get interesting to them when you generate between 1 and 5 million euros in annual revenue. Because on the one hand this means you have proved your market value, but on the other hand it often also means you’re so big your original team of sellers can’t hold the company together. And that’s when a Amazon seller acquisition company wants to jump in.
Most acquisitions take place with the original seller getting 3 to 4.5 times its annual net profits for the takeover.
Most deals are for 3 to 4.5 times the annual profits.
If you want to get acquired, you can just do your thing and hope you will get noticed by the many Amazon seller acquisition companies that are currently active. Or you could just contact these companies and see if they are interested in acquiring your business. That seems to be the most common practice. Just pick one of the companies below and browse their website. Most of them actively promote contacting them by showing a “sell your brand” or “sell your business” button on the homepage.
Amazon seller acquisition companies in Europe
Here’s a list of FBA acquirers, companies in Europe which business model evolves around acquiring successful Amazon sellers and FBA brands.
Alphagreen (United Kingdom)
Amazing Brands Group (Germany)
Berlin Brands Group (Germany)
Diverge Group (The United Kingdom)
Dwarfs (The Netherlands)
Excite Foundry (The United Kingdom)
The Fortia Group (Ireland)
Heroes (The United Kingdom)
Marketplace Powerbrands (Germany)
Merx Brands (Germany)
The Mothership (The United Kingdom)
Olsam Group (The United Kingdom)
One Retail Group (The United Kingdom)
Orange Brands (Germany)
Scythia (The United Kingdom)