$400 Million Investment
Founded in August 2020, Razor Group is a German consumer holding startup company that buys and helps scale Amazon marketplace merchants into multi-channel businesses.
With more than 10 years of experience in ecommerce and helping companies build brands, Razor Group partners with Amazon merchants and provides them with resources to grow their businesses on a larger scale in a matter of six weeks.
The ecommerce merchants sell products across a variety of industries such as personal wellness, sports, and home and living. Some clients include Effekt Manufaktur, Bamodi, Purava, HappyPo, and Charles Daily. Razor Group typically targets brands that pull in between $1 million and $15 million in annual revenues.
Redalpine, 468 Capital, Presight Capital, and a few others are all investors in the business.
It was reported the company raised $400 million in a new financing round led by BlackRock and Victory Park Capital. Previous investors also participated in this funding round. Of this capital, $25 million comes from equity financing, and the remainder is in venture debt to use for acquisitions. Razor Group has raised $40 million in total equity financing.
According to the report, the business supports 30 Amazon merchants that will help the startup surpass $120 million in sales across these brands.
“We are pleased to make this investment in Razor Group to support the company’s strong growth momentum as it continues to diversify its portfolio of brands and expand into new markets,” added Dan Worrell, managing director at BlackRock, in a statement.
CEO of Razor Group, Tushar Ahluwalia, said in an interview that the business hopes to become a new version of P&G that builds and supports ecommerce “microchampions in micromarkets.”
With the new capital, the startup company plans to scale its business by continuing its efforts in the consumer holding space.
Razor Group did not comment on its valuation numbers.
Razor Group Competitors
While Razor Group is experiencing some impressive success after launching less than a year ago, it is not the only business in this market.
Thrasio is a digital consumer goods business that scales ecommerce merchants similarly to Razor Group. Startup Savant reported in January that Thrasio raised $500 million in a senior debt facility. Thrasio serves more than 100 different ecommerce Amazon brands and racked up $100 million in profits through the acquired brands in 2020.
Heroes, SellerX, Perch, and Valoreo are just a few other competitors in this industry.
Startup Savant reported in early February that Amazon saw net sales increase 44% in the fourth quarter to $125.6 billion in 2020 compared to $87.4 billion in 2019.
Third-party merchants played a contributing factor to this impressive jump in sales. According to Statista, Amazon generated $80.5 billion in third-party seller service revenues in 2020. This is up from $53.8 billion in 2019.
About the Author
McKenzie Carpenter is a graduate of Central Michigan University with a B.A.A. in Integrative Public Relations and French. McKenzie has previously worked for small businesses and nonprofit organizations.