ChannelEngine, a platform that helps retailers connect with and sell through more than 200 marketplaces, raises $50M for an operating system that helps retailers sell through marketplaces, Today.
This funding will be used both to continue expanding the number of marketplaces it works with, the number of retailers that it connects to and to build out what the next generation of e-commerce will look like for all of them.
Atomico is leading this round with new investor General Catalyst, plus previous backers Inkef and Airbridge Equity Partners, also participating; Stephan Schambach, the founder of Demandware, Intershop, and NewStore, coming on as an angel investor.
The company was founded in 2013 raised only around $7 million before this round, most recently doubling revenues in the last year on a base of over 450 retailer customers, with the list including the likes of Bugaboo, Staples, JBL, Polaroid, Hunkemöller, Brabantia, Reckitt Benckiser, Bosch, JDE, Electrolux, Philips Domestic Appliances, Signify, Diadora, Glanbia, Oneill, and Safavieh.
ChannelEngine came just when e-commerce became a necessity as the pandemic drove many companies and people to sell and buy online. Amazon has made a massive success in the world of e-commerce by aggregating millions of retailers in one place creates a one-stop-shop for those looking for goods, and retailers can lean on Amazon’s economies of scale not only to sell to those shoppers but to distribute and deliver those products, too.
There is also eBay, Walmart, Zalando, Mercado Libre, AliExpress, Back Market, Shopee, Lazada, Mirakl, Bol.com, Allegro, CDON, Cdiscount, Catch, and even Macey’s is another example of the many other generalists and more localized storefronts out there for retailers to leverage when targeting consumers.
ChannelEngine founder and CEO Jorrit Steinz commented, “They are all becoming marketplaces.”
ChannelEngine is trying to tackle with its platform to set up relationships with each marketplace by providing a set of tools that will help retailers adjust pricing based on the site and audience and what’s selling for what (automated repricing in the vocabulary of the trade), handle their content, stock and order management; and connect with third parties to manage other analytics and delivery.
The company is managing distribution for some 6 million products from 8,100 brands across more than 200 sales channels; in the world of e-commerce, there have been other ways to help smaller retailers navigate growth amid the choppy waters of marketplaces, for example, the rise of Thrasio-style aggregators, e-commerce roll-up plays that promise better economies of scale to smaller brands by way of scooping them up and working with them as a more cohesive, scaled-up group to better leverage sales data, as well as manufacturing and distribution networks.
Steinz mentioned that a number of these are ChannelEngine’s customers: many promises to help their brands sell better on marketplaces, but in a lot of cases, their expertise is more in identifying the most successful retailers and helping them on specific marketplaces like Amazon, not working across multiple platforms: that is the technology they often buy-in, working with the likes ChannelEngine to fill out that business opportunity.
That also potentially makes a company like ChannelEngine, combined with other tools like headless commerce builders and those that help companies design and run their storefronts, an alternative to selling up to a bigger brand.
The e-commerce market is being projected to reach $5.9 trillion by 2023; Steinz noted that other opportunities on the horizon would likely include not just more marketplaces but more non-commerce platforms for selling that become de-facto marketplaces, such as Instagram and TikTok, as they integrate more direct selling tools and better ways to discover what is being sold on their platforms beyond algorithmic inline ads.
Joining the board with this round, Atomico principal Luca said, “The COVID-19 pandemic dramatically accelerated the adoption of e-commerce, which now accounts for 20% of all global retail sales. The global e-commerce market is expected to grow by over $500 billion between 2022 and 2023 alone,” resume “By building the largest e-commerce operating platform, ChannelEngine is set to capitalize on this opportunity by giving brands and retailers instant access to the global marketplace.”.
Larry Bohn, managing director, General Catalyst, who is also joining the board, along with GC’s Max Rimpel, commented, “As the use of e-commerce continues to accelerate, retailers and brands have to meet consumers where and how they shop. ChannelEngine has built out a complete, tech-first platform that’s both robust and global. General Catalyst is excited to invest in ChannelEngine as they help leading e-commerce companies sell on marketplaces worldwide”.