Grove Expands Amazon Aggregator Division To Widen Net In Multibillion-Dollar Market

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After just a few years on the scene, the Amazon.com Inc. AMZN aggregation space now encompasses 89 active aggregators, with a combined $13.6 billion in capital raised. With so many players and so much capital, it’s an exciting and rapidly evolving space.

As of October, Grove Inc. GRVI, a hemp and CBD wellness product leader, threw its hat in the ring with the launch of Upexi Solutions, an e-commerce aggregator that is meant to offer fast acquisition deals, expert marketing and sales support and other services that make it an attractive pick for brands looking to sell. Here’s what the market has shaped up to be and how Grove is looking to set itself apart from the pack.

Emerging Amazon Aggregator Market Attracts Investors And Ecommerce Brands

Third-party retailers accounted for 65% (or $390 billion) the $600 billion in gross merchandise volume sold on Amazon in 2021. That $390 billion market is the target of Amazon aggregators who seek out promising small to medium e-commerce brands to add to their portfolios.

The trend reportedly gained serious traction during the early months of the pandemic. In 2020, the Amazon-native brand Anker Innovations Technology Co. Ltd. (SHE: 300866) went public, and the Amazon aggregator startup Thrasio Holdings Inc. had raised more than $520 million by July. Those events, paired with an ongoing surge in e-commerce spending, led to a blowout year for the emerging Amazon aggregator space.

Early signs suggest the trend may continue well into 2022. A survey by ecommerceaggregators.com found that 87% of third-party sellers generating $1 million or more in revenue are hoping to sell to an aggregator this year.

The reason for the widespread interest in selling? Supply-chain disruptions that rattled industries worldwide last year were a wake-up call to these growing but still small businesses, making the stability that comes with the support and capital backing of a larger company more attractive.

Grove Takes Jump Into Aggregator Space With Upexi Launch

Last Fall, Grove launched Upexi, a wholly-owned division tasked with taking the company into the fast-growing Amazon aggregator space. Upexi’s goal is to acquire promising Amazon and e-commerce brands with the aim of building a revenue-generating portfolio of diverse brands in the health, wellness, beauty, and pet-care space.

Arguably one of its most exciting success stories from this new venture was its acquisition of VitaMedica, an online seller of wellness supplements with $10 million in product sales in the past few years that immediately added net positive income to Grove’s balance sheet.

Just five months after launching Upexi, Grove says it’s receiving multiple submissions a week, driven, in part, by the company’s ability to offer a team of in-house digital marketing experts, programmatic ad technology, and Amazon marketing experts.

Soon after launching Upexi, Grove added a fund-your-brand option to the Amazon aggregation branch of its business. This subdivision is meant to allow Grove to invest in up-and-coming brands that want to raise additional capital to accelerate growth but don’t want to sell their business.

Together, these two operating segments may give Grove a wider pool of acquisition and investing opportunities in the Amazon and e-commerce space.

This post contains sponsored advertising content. This content is for informational purposes only and is not intended to be investing advice.

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