In 2020, Thrasio raised hundreds of millions of dollars and eyebrows, then the floodgates opened. By 2021, billions of dollars had been raised for as many as 100 Amazon aggregators.
Everyone was doing it.
By 2022, the Covid bump slammed shut the floodgates, and the aggregator’s magic was gone – all thanks to supply chain and inventory management issues which are absolutely critical to an Amazon business.
The gold rush of free money and outrageous aggregator valuations is over. Big aggregators are missing their obligations, and the rumor mills have it that it’s about to get worse. We might even see some bankruptcies soon.
Amazon aggregators and their venture capital backers are beginning to learn the hard way what my guest and I learned a long time ago.
Amazon is different, it’s hard, and it’s all about the BRAND.
Building a great, beautiful, and trusted brand continues to be the pathway to success and wealth. You can’t sling commodities on Amazon today and hope to have success.
The Amazon Aggregator Business Model
Amazon FBA aggregators mainly acquire small, profitable amazon businesses that are well established and focus on scaling them to generate even more profits.
The aggregators’ business model is simple. Identify an FBA brand, approach the owner to negotiate terms, and acquire it. Their only goal is to acquire multiple small FBA brands and consolidate them under one business.
If you have wanted to understand the Amazon Aggregator business model or have been looking to sell to an aggregator, then this is a must-listen episode as we go through some great points.
I am joined by my friend, James Kelly, to discuss Amazon aggregators, brand building, and 2023 predictions.
Additional Resources…
– Check out James Kelly’s brands here: https://www.woolly.clothing/ and https://www.bloom.city/
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