Published On: Fri, Mar 5th, 2021

Jungle Scout raises $110M, acquires Downstream Impact to assistance 3rd parties sell on marketplaces like Amazon

There has been a quick proliferation of roll-up companies armed with wallets full of income to connect earnest smaller merchants that sell on Amazon and other marketplaces, a thought being to emanate economies of scale to assistance them sell some-more effectively and grow. Today, a association that is rather doing a conflicting — building collection to assistance Amazon sellers work improved on their possess — is announcing poignant appropriation to keep flourishing a business.

Jungle Scout, an Austin-based association that builds collection covering services like hunt and marketplace analytics, register management, and sales comprehension for companies offered on Amazon, has lifted $110 million in equity that it is regulating in partial to make an merger — Downstream Impact, a dilettante in Amazon promotion founded by dual ex-Amazon execs who did early work on Amazon’s in-house promotion efforts — and in partial to continue flourishing a business.

You competence not know a name though Jungle Scout it is sensitively huge. It says that a collection impact some $8 billion in Amazon income with around 500,000 brands and entrepreneurs already regulating it. Its information engine ingests search, purchasing, and other information for some 500 million Amazon products, that it afterwards turns into information to assistance business sell on Amazon better.

Jungle Scout began life in 2015 focusing essentially on providing optimizing hunt collection for sellers only on Amazon — if we didn’t theory that already by a “Jungle” and “Scout” in a name. Tools for improving business on Amazon still make adult a bulk of a business, with a functionality covering not only though 9 other informal Amazons. But now, a startup is solemnly starting to enhance a services over that. That could embody Google Shopping, Facebook’s many amicable platforms, and some-more — whichever marketplace platforms consumers occur to be using.

“We are starting with, that will be live in nearby future,” CEO Greg Mercer pronounced in an interview, “and a prophesy is to enhance over that. We’re bullish on a destiny of Amazon, though if we cruise over that, my prophecy would be that besides those platforms where people essentially go to squeeze things, there are places where consumers spend their time — such as Google or amicable channels like Instagram — that could be other areas where we could yield collection to sell through.”

The startup is also building out a business on a belligerent in China, he said. The nation represents one of a fastest flourishing source countries not only for goods, though merchants, too.

Summit Partners, a try collateral and private equity firm, is a primary financier in this appropriation round, with Mercer himself also contributing. It’s not transparent how many Jungle Scout has lifted to date: PitchBook records that Summit had corroborated it previously, in 2017, during an undisclosed sum and valuation. I’ve reliable that a $110 million being disclosed now is a initial time that Jungle Scout has suggested how many income it has lifted over a years, nonetheless it’s still not disclosing a valuation.

You competence notice that in a initial divide of this story we mentioned that Jungle Scout is “somewhat” holding a opposite proceed to a roll-up companies, companies like Thrasio, SellerX, Branded, Heyday, Heroes, Perch, Berlin Brands Group, and presumably others that are lifting hulk sums of income to source, and afterwards partner with or buy up, third celebration sellers.

Jungle Scout does indeed yield a profitable use to Amazon retailers who are leveraging a giant’s FBA height to conduct a operation of services like inventory, shipping and offered (in a form of appearing on Amazon to sell things), and who wish to sojourn eccentric and not be “rolled up.”

However, that’s not indeed a full story. Mercer tells me that his association also provides a record as a white tag use to many of a large roll-up players — that of these, he did not note — and so we competence also contend that even if third-party merchants are not operative directly with Jungle Scout, they competence good finish adult doing so indirectly.

The event for building out some-more collection to residence a Amazon economy is a large one. As we’ve forked out before, it is estimated that a series of third-party sellers on Amazon now stands around 5 million, a series that appears to be flourishing exponentially during a moment, with some-more than 1 million sellers fasten a height final year. That includes not only smaller retailers who are looking to extend their consumer touch-points, though also increasingly a series of large brands that are now looking during how they can precedence Amazon improved to sell directly to consumers on a platform, rather than around third-party merchants.

Within that, promotion stays a outrageous and flourishing partial of a equation.

If we are an Amazon user, you’ll notice that ads hunt pages have been flourishing in series over a years (these are a sponsored formula that come adult during a tip of searches we competence make for a product), and so we will be unsurprised to know that advertising, as a result, is unequivocally flourishing quick for Amazon itself.

Ads alone accounted for $21.5 billion in annual income for Amazon in 2020, adult 66% year-over-year.

Connor Folley, Downstream’s CEO who co-founded a association with another ex-Amazonian, Salim Hamed (who is Downstream’s CTO), told me that ads “within a walls of Amazon itself” still make adult a infancy of that figure, nonetheless it will continue to deposit in areas like a DSP to enhance over a possess ecosystem. That creates it rather of a dim equine in a universe of advertising, that adult to now has been some-more endangered with a arise of Facebook among “new” players.

“The bomb expansion of Amazon promotion over a final 5 years has surpassed many people’s expectations,” he said. “It competence be a $50 billion dollar height by 2023 — and many bigger than Facebook.”

While there are a lot of companies out there building collection and alternatives for sellers to get a improved hold to sell on Amazon, a captivate here has been in partial a distance of Jungle Scout and a prevision in building this marketplace in a initial place.

“Jungle Scout was one of a initial companies to brand a event to yield SaaS-based collection to assistance businesses and brands enhance their ecommerce footprints on Amazon and beyond, and a association has built on this care position over a final several years,” pronounced Neil Roseman, Technologist-in-Residence during Summit Partners and Jungle Scout Board Director, in a statement.

It’s a clever opinion of certainty when we cruise that Roseman himself is also an ex-Amazonian, carrying been a VP of record between 1998 and 2007 operative on marketplace record among other things. “We trust Jungle Scout’s record is strong and rarely scalable, designed to assistance a association to grow as a Amazon third-party offered ecosystem has expanded. We trust a further of Downstream Impact will supplement to this product and engineering strength, and we are anxious to be a partial of a company’s expansion journey.”

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