Paris based Branded and San Francisco based Heyday have merged and will form a new company called Essor which translates to “take flight” in French. The combined companies would be worth more than $1 billion and are expected to generate annual revenue of $400 million. Apollo, BlackRock and Victory Park provide new debt financing to help the combined entity make further acquisitions.
Branded CEO Pierre Poignant will run Essor. He previously co-founded the Southeast Asia-focused online marketplace Lazada, in which Alibaba Group. has a controlling stake. Branded raised $140 million from investors including Target Global. Heyday founder Sebastian Rymarz will become president of Essor. Heyday raised more than $250 million from such investors as Khosla Ventures and General Catalyst.
The newly formed company will use a new round of debt to buy promising online brands and try to boost their sales and exposure by getting them into big-box retailers. More than 80% of consumer spending occurs in physical stores, according to EMarketer Inc, making shelf placement a promising strategy to boost sales of brands that began online.
Heyday and Branded are part of the crowded market of Amazon seller aggregators. Companies in the space took advantage of low interest rates and pandemic-driven growth in e-commerce to collectively raise more than $16 billion from top names on Wall Street and in Silicon Valley with the intent of rolling up independent sellers on Amazon’s marketplace. Aggregators caught the attention of high-profile investors like L Catterton, BlackRock, and even Jared Kushner’s Affinity Partners.
Source: CNBC, Bloomberg