Ecommerce roll-up companies pause brand buyouts, seek funds for survival

economictimes.indiatimes.com:

ecommerce roll-up model, in which a company acquires and scales up multiple brands, is showing clear signs of distress with key players pausing fresh buyouts as they look for capital, multiple people aware of the matter said.

Goat Brand Labs, among the better funded startups in the sector, is racing against time to raise fresh capital amid a widespread slowdown, people aware of the matter said. The Tiger Global-backed startup’s travails come after nearly two years of record funding that helped roll-up ecommerce firms like Goat bulk up their portfolio of brands, spurred also by the entry of industry pioneer US-based Thrasio into the Indian market.

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Smaller startups in the space like 10club and Upscalio have also either pivoted or are looking to be acquired while bigger rivals such as Mensa Brands and FirstCry arm GlobalBees are focusing on sustainable growth of select brands from their portfolio.

Chasing Capital
Meanwhile, Mumbai-based Good Glamm Group – which acquired brands like The Moms Co – is expected to clock a slower rate of growth in the ongoing fiscal year as it has been trying to reduce burn and find a path to profitability.


Goat’s Challenges
“This is the moment of truth for Goat… (it) has about a quarter of cash runway left. Talks are on with existing lenders and venture debt firms to arrange for working capital,” said one person cited above.

Also read | Rollup ecommerce: an idea whose time has come

Goat,