Amazon aggregators are losing steam

Ecommerce sales blew up in 2020. Unsurprisingly, Amazon benefitted from the trend.

With increased shopping on the platform, a popular new startup sector emerged: Amazon aggregators (AKA “roll-ups”).

Amazon aggregators…

… buy and consolidate brands that sell on Amazon. Housing the brands under one company creates supply-line efficiencies and allows them to negotiate better deals with Amazon.

The 2020 ecommerce boom led to a very frothy funding market for the sector:

• Thrasio, perhaps the best-known Amazon aggregator, raised ~$3.4B and acquired 200+ brands.
• Perch, another aggregator, raised nearly $1B and acquired 80+ brands.

Overall, the sector raised $12B+ in 2021, per Financial Times.

But 2022 has been a different story

Funding for the sector has been stuck since the market took a turn for the worse in March, leading some aggregators to focus less on acquisitions and more on growing existing brands.

• One analyst called 2022 “the year of survival” for aggregators, which could mean consolidation is coming.

If that’s the case, it’s only a matter of time before some aggregators get aggregated.