Hey there 👋,

Welcome back to another issue of Inversal, which features honest, real-life stories on actual e-commerce turnarounds, market trends, strategies, and insights.

In today’s issue:

• China visit for a Deal

• SellerX goes to auction

• Amazon quick hits

• Is the Amazon aggregator business model dead?

China visit for a Deal

I went to Shanghai from Tuesday to Thursday to visit the main factory of a deal that came through less than two weeks ago.

We plan to close in September, and it will double the size of Inversal. We are very excited as this brand has 25 years of history.

More will be revealed when we close.

🚀💰 Amazon Aggregator SellerX Boom To Auction

Once a prominent player in the Amazon aggregator boom with a $1B valuation, SellerX is now facing an auction, underscoring the volatility of the e-commerce industry.

This dramatic turn of events for the Berlin-based startup, which raised over $750M in just a few years, marks a significant shift in the once-thriving Amazon aggregator space. Initially buoyed by the e-commerce boom during the pandemic, SellerX is now a symbol of the challenges faced by VC-backed aggregators that grew too fast.

The company, founded in 2020, quickly scaled by buying smaller brands and selling them on Amazon. However, it has been struggling to sustain its growth, defaulting on debt repayments, and facing internal shifts, such as the departure of its co-founders earlier this year. The decision to put SellerX up for auction was triggered by an inability to meet financial obligations amid a sharp downturn in the aggregator market.

• 🛍 Debt Trouble: SellerX's debt to investors like BlackRock, who classified it under "non-accrual" (default), is a key factor in this auction move​

• 📉 Aggregator Industry Woes: Like SellerX, other companies in the space, such as Perch, are facing similar struggles, with lawsuits and market challenges​

• 🏢 Founder Exodus: Co-founders Philipp Triebel and Malte Horeyseck recently departed the company, leaving Jeremy Bell, from Elevate, to take over​

As SellerX approaches auction, the once-booming aggregator sector faces scrutiny over its rapid, VC-fueled expansion. Many other aggregators that sprang up during the pandemic’s e-commerce surge are encountering similar difficulties, including layoffs and declining valuations. SellerX's downfall raises larger questions about the sustainability of the aggregator business model.

Link to Article →

⏩ Amazon Quick Hits

• Amazon experienced checkout issues during its Labor Day sale, frustrating customers and potentially impacting sales, though AWS reported no problems (Link)

• Amazon has improved US Multi-Channel Fulfillment delivery times, reducing the standard to three days and expediting to two, with no additional charges (Link)

• Amazon's "Prime Big Deal Days" will return in October 2024, offering exclusive discounts for Prime members and targeting holiday shoppers with 48-hour deals (Link)

• Amazon has introduced a new feedback process allowing sellers to rate support interactions after each email communication, aiming to improve training and communication (Link)

• Amazon now allows advertisers to boost top-performing Posts into Sponsored Brand ads with AI upscaling, expanding reach and testing creative strategies seamlessly (Link)

• Amazon sellers must send inventory to AWD by October 19, 2024, to ensure products are Prime-ready for Black Friday and Cyber Monday sales (Link)

• Is your Amazon category dominated by Chinese sellers? (Link)

💸 Is the Amazon Aggregator business model failing?

SellerX, once a rising star in the Amazon aggregator space, faces auction after burning through $750M in funding. Founded in 2020, it aimed to scale Amazon-native brands but struggled under massive debt, high operational costs, and the economic slowdown. This failure reflects broader troubles across the aggregator industry, which saw billions in VC backing but now faces declining sales and heavy debt loads.

• 💰 Debt-heavy: SellerX is crippled by a $400M BlackRock loan.

• ⚠️ Scaling challenges: Failed to grow beyond initial success.

• 📉 Market downturn: Amazon aggregators across the sector face similar struggles.

Link to Article →

🐦 Post of the Week

That’s it for this week.

If you have any questions or would like to know more about how Inversal can help you, just hit reply or send us a message.

Thanks!

Marc Roca
Founder & CEO
Inversal
X | Linkedin

Marc has founded, acquired, and operated more than 30+ e-commerce brands since 2017. He is also the founder of the third-ever Amazon Aggregator.