Amazon Aggregator Thrasio Files For Bankruptcy (nasdaq.com) 18
Thrasio, which acquires third-party Amazon sellers, filed for Chapter 11 bankruptcy protection and received commitments for $90 million in new financing from existing shareholders, it said on Wednesday. From a report: Thrasio also entered into a restructuring agreement with some of its lenders to reduce debt of $495 million from its existing debt pile, it said in a statement. It listed its estimated assets in the range of $1 billion to $10 billion and estimated liabilities of $500 million to $1 billion, according to a document filed with the New Jersey bankruptcy court. Billions of dollars, primarily in loans and other debt instruments, were invested into newly-formed startups aggregating third-party merchants on Amazon's marketplace during the COVID-19 pandemic as investors bet heavily on a prolonged explosion in online shopping. But as lockdowns eased and consumers returned to brick-and-mortar stores, sales growth on Amazon slowed, leaving these heavily-indebted "roll-up" companies struggling to service interest payments.
WTF is an "Amazon aggregator? (Score:5, Insightful)
Amazon is already an aggregator for cheap Chinese knock-offs and general tat.
Re:WTF is an "Amazon aggregator? (Score:5, Informative)
Apparently they are the cheap products you mention Amazon is aggregating.
"Amazon Aggregators are businesses that acquire and consolidate small private label brands selling on Amazon. Their goal is to scale and integrate each brand into their larger organization. FBA Aggregators trade almost exclusively online and own a vast array of products in different niches and geographical markets."
Here are some of their cleaning brands: Angry Orange, Turbo Mops, ThisWorx, Brush Hero
Re:WTF is an "Amazon aggregator? (Score:4, Funny)
So... Amazon Aggregators lose money on each acquisition, but make it up on volume? They're cutting in the middleman -- if you ignore Amazon already being a middleman who also provides the platform they live on?
I must be missing some part of the business model....
Re:WTF is an "Amazon aggregator? (Score:5, Informative)
That seems about right, although Amazon famously fucks over successful small business brands on their platform by essentially stealing their ideas [reuters.com] and putting out copycats under their own labels.
This sounds like some kind of venture capital bullshit to buy up those labels and put them under one. Think Softbank. I'm not sure how they compete with what Amazon is doing to their own retailers on their platform where they control all the information. From the bankruptcy filing, it looks like they don't.
Editors please give context in stories (Score:1)
Missing context: "Thrasio, which acquires third-party sellers on Amazon, said it will continue to operate its business normally and without interruption throughout the bankruptcy process."
Re: (Score:2)
I read the FA and that information was there, that's also presumably what you are quoting.
Re:Editors please give context in stories (Score:5, Insightful)
If we have to click through to find out a key fact like what the company even does then the summary sucks.
A summary should provide enough detail to help readers decide if the topic is interesting enough to dig deeper, not force them to dig deeper to find out if there's anything interesting going on at all in the first place.
Summary of this article's summary: failed due to lack of sufficient information.
Re: (Score:2)
Pointless
The web page at https://bf15845f0d65fceacd904e... [googlesyndication.com] might be temporarily down or it may have moved permanently to a new web address.
ERR_BLOCKED_BY_ADBLOCKER
Re:Editors please give context in stories (Score:4, Funny)
FTX baby sibling? (Score:3)
* They raised $3bn
* They borrowed/owe $0.5bn-$1bn
* Their assets are worth as little as $1bn, but could be worth $10bn if they got lucky during liquidation
* They are not solvent (hence chapter 11 bankruptcy)
Sounds very much like crypto startup financials, FTX baby sibling perhaps? Is there a Thrasio coin?
Re: (Score:2)
No need for crypto. The suits got paid and that’s all that matters.
A what now? (Score:2)
I am torn (Score:2)
Between asking "who?" and "what?"
Quite seriously, a bit more context would really help me to decide whether I should give a fuck.
They asked me for money a few years ago (Score:3, Interesting)
Upper90 pitched me repeatedly raising money for Thrasio. There were multiple rounds of financing, all very large. I could probably find the pitch decks if I dig deep enough. The basic idea was "people can make money as Amazon marketplace vendors. Some people can do this in a smart, automated way, figuring out what things to bulk-import from AliBaba, how much to spend promoting them, etc." Most of the financing was equity-style I think; you put money in now and hoped that at some point down the road they were able to sell Thrasio to somebody else (but to whom?).
Personally I never understood the business; my theory is that if it's profitable enough to be interesting to Upper90's limited partners, Amazon will inevitably squeeze them to capture the margin for themselves. That company doesn't leave a dime on the table.
But that may not be what happened — Thrasio management say the business will continue to operate through and after bankruptcy. If margins had dropped near zero, they wouldn't bother. We'll find out more during the bankruptcy process.
Re: (Score:2)
Hmm..... yeah. The part of this that makes no sense to me is why, if you can successfully accomplish this (automation of purchases from sites like Alibaba to auto post to Amazon Marketplace if/when it makes good financial sense), you would worry about building some business model around offering this service to other vendors?
If it really works? Why aren't you just doing this yourself and profiting? (Obvious answer is that it's not REALLY so profitable or worth the effort and/or technical issues involved, so
Re: (Score:2)
I think your understanding of Thrasio is a bit off. They bought the individual stores. They may have eventually shared a software platform with those companies but that wasn't part of the original pitch. Rather, if you established "Gilbert's bicycle wheels" as a vendor on Amazon and managed to turn a profit selling wheels in the marketplace, Thrasio might offer you a lump sum in exchange for your brand name (?) and future cashflows. There was earn-out provision, presumably, to keep the sellers working, but
Re: (Score:2)
Ok.... gotcha. I never even heard of Thrasio before this, so it's all news to me as of today. :)
Ultimately though? Still pretty unimpressed, then. There are new "brick and mortar" startups out there trying to get businesses going every day, and it's more useful for society and our economy as a whole if someone throws some money at keeping what they're doing alive/thriving (even if they're buying them out to then run it themselves).
I mean, for example? I have a friend with an adult daughter who just partner