E-Commerce Marketplace Aggregators Are Hot On Thrasio’s Heels As Companies Raise $2.3B

When the pandemic began, we bought 16% of our things online. Now, we buy nearly 34% of our things online. That’s the kind of hockey stick growth investors like to see, and the ecommerce infrastructure companies’ valuations are skyrocketing accordingly.

Data and analytics mattered much more online than having a great team of human merchants. There was a great story in the “Everything Store” about how the algorithms outperformed the human editors that Amazon employed in their book section. A culture of relentless A/B testing and data driven decision making was essential to online success.

But for now – there is not a lot of capital in the space, and many of these sellers cannot keep up with their own growth. The easiest way to get de-ranked is by running out of inventory, but a business that can’t get financed, is fully bootstrapped, and that is growing quickly (with holiday season volatility) will struggle to procure inventory fina... See more

Ultimately, CVS ($110B) and 7-Eleven ($42B) should be ultrafast's real targets, not Kroger ($28B) or Albertsons ($9B). Online grocery is a massive challenge both in logistics and demand generation, and ultrafast services are better off building a better convenience store than challenging for the whole of the online grocery market.