Plus, new funding for an ecommerce SaaS aggregator and an gray hair prevention brand.
Welcome to Dealboard. In this weekly feature, The Current is providing a look at the mergers, acquisitions and venture capital deals making waves in ecommerce, CPG and retail.
This week, digitally native brands Manscaped and Casper get cash infusions, while Tom Ford finds a home with Estée Lauder. Plus, new funding for an ecommerce SaaS aggregator, Better Trucks and a haircare formula addressing gray hair.
The Estée Lauder Companies announced an agreement to acquire Tom Ford for $2.3 billion, ending a long courtship that reportedly included a variety of suitors after the luxury brand put itself up for sale earlier this year.
The brands are familiar to each other, as Estée Lauder already owns the license for Tom Ford Beauty. The deal will also expand Tom Ford’s longstanding licensing deal with Italian luxury house Ermenegildo Zegna N.V. to include men’s and women’s fashion, accessories and underwear, with Zegna acquiring operations necessary for this licensee role. Tom Ford also has a license with eyewear brand Marcolin that will be extended.
Founder Tom Ford is set to remain with the brand as the “creative visionary” through the end of 2023, while Domenico De Sole will remain as a consultant through that time.
The move will strengthen four-year-old Dropshipping Direct’s systems and customer base, while while simultaneously opening doors for new strategic partnerships. Through an automated system, Dropshipping Direct manages product sourcing, selling, buying, shipping and returns for sellers.
Since raising a Series A in 2020, the six-year-old brand has grown from $65 million in revenue to $300 million. This year, it signed on with celebrity partner Pete Davidson, and expanded its retail partnership with chains such as Walgreens.
“This new capital allows us to continue our trajectory and to accelerate our global omnichannel expansion and product development as we strengthen our position as the leading men's grooming and lifestyle brand,” said Paul Tran, Manscaped CEO, in a statement. "The investment also strategically strengthens our position as we ramp up for an exciting holiday season in 2022 and look forward to a robust product roadmap in 2023 and beyond.”
Side view of the breathable and ergnomic Casper mattress i… | Flickr (www.flickr.com)
Digitally native mattress brand Casper secured an $80 million credit facility that will provide working capital, and allow the company to retire an existing credit facility. The financing was arranged by Second Avenue Capital Partners, LLC, with support from Tiger Finance. It comes after Casper was taken private a year ago in an acquisition deal with Durational Capital Management earlier this year. The brand initially went public in February 2020.
The funding was led by Primary Venture Partners, Twelve Below, AlleyCorp, Max Ventures and TriplePoint Capital. It will be used to acquire more businesses, as the company seeks to apply the aggregator used to roll up ecommerce brands for software business.
“We’re building for the SMB ecommerce merchant that wants enterprise-grade functionality made accessible to the sorts of teams that wear many hats,” wrote CEO Ricardo Hinds. “We’re also pairing our team’s knowledge of scaling software businesses with our appetite for acquiring bootstrapped software businesses.”
Attabotics, a 3D robotics supply chain company, raised $71.7 million in a Series C-1 round. The financing was led by Export Development Canada, with participation from Ontario Teachers’ Pension Plan Board through Teachers’ Venture Growth.
The company condenses fulfillment warehouses into a single storage structure, with robotic shuttles called Attabots inside picking goods, and presenting them to workers outside. The aim is to allow warehouses to be located in densely-populated areas, where they will be closer to customers.
Better Trucks. (Courtesy photo)
It’s the first outside investment for the company, which was founded by Andy Whiting and Weston Webb in 2019. Better Trucks provides next-day and same-day residential delivery, serving brands in the Midwest, Northeast, Southeast, and Texas, as well as delivery companies like ShipBob. WIth the funding, it is planning to double a coverage area that currently extends to 25 metro areas across 17 states, and invest in additional warehouse capacity. It will be hiring in technology, operations and corporate functions, as well as building a flexible driver workforce.
Zest, a platform that allows ecommerce brands to create a gifting model, raised $4.2 million in a seed round led by Google Ventures (GV). Participating in the funding were BoxGroup, Character, Operator Partners, Bungalow Capital and Company Ventures.
Zest’s platform places a “Send as a Gift” button on product or cart pages. Gifters can then choose to send a digital greeting card, add their own message and instantly deliver the gift to the recipient via text or email.
“The app not only makes the act of digital gifting easy and meaningful, but we go a step further and make it possible for brands to turn that purchase into a real relationship with recipients," said Alex Ingram, Zest's CEO, in a statement.
Arey. (Courtesy photo)
Founded by Allison Conrad and Jay Small, Arey focuses on restoring gray hair, offering a supplement and hair serum known as The System that is available through one-time or subscription purchase. The brand saw 975% growth in subscription in the last year, making up over 70% of their revenue. The funding will assist with R&D and distribution expansion.
Here are a few more deals we spotted this week thanks to the reporting of Techcrunch:
Plus, check out peak holiday shopping weekend results shared by Klaviyo, Wayfair and Ace Hardware.
At Amazon, 2022 delivered the "biggest ever" Thanksgiving weekend to date.
ustomers purchased a record number of products from Thanksgiving through Cyber Monday, the company said in a news release Wednesday. Amazon did not disclose sales figures, while sharing that “hundreds of millions” of products were purchased.
"This was a record-breaking holiday shopping weekend for Amazon,” said Doug Herrington, Amazon’s CEO of Worldwide Stores, in a statement. “Customers shopped millions of deals this weekend and we have many more amazing deals to come.”
It came as record sales and traffic were reported for US ecommerce as a whole during the peak shopping weekend.
Despite the growth, Amazon is still expressing a cautious approach that led it to forecast more tepid sales growth over 2021 for the all-important holiday quarter. According to Bloomberg, CEO Andy Jassy said Wednesday that inflation is leading shoppers to seek deals.
“Consumers are spending, but they’re being careful about trying to stretch their dollar,” Jassy said at the New York Times DealBook conference.
This year, Amazon sought to get an early jump on the shopping holidays to reach bargain hunters. It began Black Friday deals on Thanksgiving, as many shoppers turned to their phones after dinner. For Cyber Monday, deals started on Saturday.
Over the Turkey 5, the best-selling categories were home, fashion, toys, beauty and Amazon devices. Electronics including Echo Dot, Fire TV Stick, and Apple AirPods were the best-selling items. Other top sellers included Hasbro Gaming Connect 4, Burt’s Bees Christmas gifts, apparel from Champion, apparel and shoes from New Balance, the Amazon smart plug, Echo Show and Nintendo Switch.
Amazon said that more than $1 billion in sales were generated for US small businesses through the weekend. This includes third-party sellers that offer goods on Amazon’s marketplace and access its logistics services through Fulfillment by Amazon (FBA).
“If the news of Amazon having the best Black Friday weekend in company history is any clue, it was historic for 3P sellers in many ways,” said Jon Elder, who consults with Amazon sellers as founder and CEO of Black Label Advisor.
Elder said that the vast majority of FBA sellers experienced “tremendous” year-over-year growth through the weekend.
“Sellers noticed that customers were hungry for deals like never before and coupons played especially well,” Elder said. “Some sellers opted to not sign up for deals and still experienced historic traffic and sales.”
Sellers also ramped up PPC, or pay-per-click, in which brands and sellers access sponsored product space to appear in prominent positions on the highly-trafficked marketplace.
“With inflation on the rise, it was more important than ever to increase brand awareness through PPC ads, including video ads. Expect to see brands make this a ‘best practice’ going forward,” Elder said.
Despite all the sales ringing up, Black Friday did bring one curve ball, as a glitch in Amazon’s ad tools led to inaccurate reporting of spend that misled brands and advertisers. According to Business Insider, the sitewide reporting error caused agencies and other ad buyers to either overspend, or miss out on sales as a result of underspending. While a spokesperson said the issue was fixed, it caused a state of confusion on retail’s most important day of the year, as many were forced to wait for a fix.
Nevertheless, the weekend's overall results serve as a reminder that the Thanksgiving shopping period remains the largest weekend of the year for ecommerce, even as Amazon has introduced Prime Day and this year’s early October holiday kickoff event, which it dubbed Prime Early Access Sale.
The Prime sale events are “unique to the Amazon ecosystem, but many Americans simply don’t show up for those events as much because of the time of the year," Elder said.
"Black Friday weekend remains king and the numbers prove that."
Here are a few more key data points over the Black Friday-Cyber Monday weekend that were shared this week:
How many sales do the volumes of messages being sent by brands account for? One of the largest platforms is offering hard numbers. Klaviyo, which serves direct-to-consumer businesses, said revenue attributed to its SMS and email marketing messages reached $2.2 billion during Black Friday-Cyber Monday. That represents a 46% increase in dollars over 2021, while total order count reached 34% year-over-year. The growth was even more staggering in SMS-attributed sales alone, which grew 200% in dollars and $190 in order count.
Black Friday was the highest day for message sends, but Cyber Monday closed the gap from 2021, with 47% growth.
This came after businesses using the platform sent a combined 10.7 billion emails and text messages—up 41% from 2021.
While Klaviyo’s growth is likely a factor, it’s a fair bet that a shift toward owned marketing channels following Apple’s App Tracking Transparency played a role in this growth.
A pair of retailers in the furniture and home improvement categories released sales results showing growth.
Wayfair, the furniture home goods marketplace, reported a “low single digit sales increase” over 2021 for Thanksgiving weekend. Over the five days, 73% of the orders were from repeat customers, while “hundreds of thousands” of new customers ordered from Wayfair for the first time. Wayfair said its revenue strengthened following an early November earnings call, in which the company shared its revenue was down 10% quarter-to-date.
Ace Hardware, meanwhile, may known for its local stores, but ecommerce was the focus of its holiday update. Black Friday brought a record online sales day for the home improvement and tools retailer, posting 45% growth over 2021. Cyber Monday also saw a year-over-year jump of 33%. Ace said demand spiked for grills and smokers, electric mowers and snow blowers, while power tools also remained a popular category. In all, Ace saw a 33% increase in ecommerce sales over 2021 during the five-day weekend.
Ace sells through its ecommerce site, but its omnichannel model remains heavily linked to its neighborhood-level stores. The company said that 90% of online orders are either picked up in store, at curbside or delivered by store associates.
“Our continuous investments in the digital and omnichannel shopping experience make it easy for customers to shop Ace any way they prefer," said Bill Kiss, head of digital at Ace Hardware, in a statement.