4 Recent E-Commerce Deals To Know About

There’s been a slew of significant transactions within the e-commerce sector in recent months, which won’t come as a surprise to anyone who’s read our most recent Digital Commerce M&A report covering developments in the industry throughout the first half of this year.

Our report showed that, following a brief drop in deal activity in the wake of the 2021/early 2022 boom, M&A volume has been incrementally increasing. Indeed, 1H2023 saw more deals inked than in any six-month period pre-pandemic.

The deals have kept on coming in the latter half of 2023, so let’s take a look at some which have caught our eye here at Hampleton Partners.

In early November, it was announced that funds advised by Bregal Unternehmerkapital had made a majority investment for an undisclosed amount in German firm Billbee. One of the major providers of e-commerce SaaS solutions for small retailers in the DACH region, Billbee serves at least 20,000 businesses in this part of the world.

It’s an all-encompassing platform described by its CEO as a “Swiss army knife for multichannel e-commerce retailers”, allowing clients to automate the process of sending and managing invoices, create shipping labels and send tracking links, and manage stock. Like all the top SaaS tools, it can interface easily with prominent shopping platforms like Shopify and Etsy.

Bregal Unternehmerkapital now aims to accelerate the company’s evolution, particularly with regards to inorganic growth. So we can expect to see Billbee snapping up other firms and become an even larger presence in the DACH region and beyond.

In October, global advertising holding company Omnicom announced its hefty $835 million purchase of Flywheel Digital. As well as being one of the biggest e-commerce transactions of 2H2023, it’s also the biggest acquisition in the history of Omnicom Group, whose heavyweight portfolio already includes the likes of media communications networks like BBDO and DDB.

Flywheel Digital provides a suite of cloud-based solutions for digital commerce companies, making it easier to track sales, improve search visibility, and better leverage the potential of digital marketplaces like Alibaba and Amazon.

The deal exemplifies how a strategic acquisition can be an effective “short cut” to effectively broadening a company’s reach – in this case, to allow Omnicom to provide the kind of cutting-edge e-commerce services which would otherwise take a long time to organically develop.

As the CEO put it, “When I sent my three top technology guys down to take a look at [Flywheel], they basically said, ‘You can’t replicate what they’ve done. It will take you as much money and at least five years,’ and that’s if the world sits still, which the world’s not about to do.”

Founded back in 2011, US company Dollar Shave Club was one of the early success stories of the direct-to-consumer, subscription-based e-commerce era. Its founders – who bonded over a shared frustration over the price of shaving kits – secured substantial funding rounds for their idea, which was to sell razors and grooming products online. This allowed them to grow the company to the point where it was acquired by Unilever for a cool $1 billion in 2016.

However, in October Unilever essentially admitted defeat in this space, with the Unilever CEO telling investors that acquiring Dollar Shave Club was an example of “unsuccessful attempts to move away from our core.” As part of a wider “pruning” of its portfolio, Unilever has now sold a 65% stake in the e-commerce company to Nexus Capital Management, which clearly feels it is a better fit.

“We are thrilled to acquire Dollar Shave Club, based on its strong brand loyalty, pioneering DTC model, and omnichannel presence,” a partner at NCM says. “We see growth potential and will invest in cutting-edge marketing, product quality and new innovations.”

Earlier this month, GigaCloud Technology, purveyor of a B2B online marketplace platform, snapped up Wondersign in a $10 million deal. Based in the US, Wondersign is a product catalogue SaaS platform which allows retailers to track their inventories in real time, eliminating data siloes and ensuring keyword-rich product descriptions remain accurate and up-to-date.

The transaction opens up Wondersign’s well-established network of US clients to GigaCloud (which is based in China), and allows it to roll out a new product dubbed GIGA IQ which it says will enhance online transactions for both physical and online B2B companies.

Momentum has well and truly returned to the digital commerce sector, which has shown a remarkable comeback after the wider downturn which befell much of the tech world as the world returned to normalcy following the pandemic. With deals coming thick and fast, it’s clear that investors and acquirers recognise an imperative to stay competitive and adopt new technologies in a world where buying online is simply a fact of life for businesses and consumers alike.

In the words of our Sector Principal Ralph Hubner, “online sales continue to climb and trump brick-and-mortar business”, leading to a “large market with strong multiples for mature and healthy companies in digital commerce”.

If you’re an e-commerce founder or decision maker, get in touch with Ralph for more guidance and insights on your M&A potential. And don’t forget to read our full Digital Commerce M&A report for an overview of the trends which have been shaping the sector and influencing deal-makers this year.