Ecommerce roll up game Opontia was launched in June and has $ 20 million in debt and equity acquire older, small e-commerce brands in the Middle East and Africa. Today the company confirmed to TechCrunch that it has closed afterward Round, a $ 42 million Series A nine months after its inception.
Roll-up games are generally known for securing more debt than equity when taking on mega-round deals. The Opontia seed round was the case, but the equity-to-venture capital ratio is around 50% each in Series A funding.
STV led the round, in which Raed Ventures, Global Founders Capital, Upper90 and VentureSouq participated. Angel investors Salman Butt from Salla and Wiktor Namysl from McKinsey Poland also joined. San Francisco-based venture debt fund Partners for Growth financed Opontia’s debt financing.
TechCrunch has found that Opontia has shifted the focus a bit towards its target market. Although founded with the Middle East and Africa in mind, the company has only made efforts in some parts of the former (the United Arab Emirates and Saudi Arabia), while making significant strides in Central and Eastern Europe, particularly Turkey and in Poland.
“There are possibilities; it is only not the biggest markets ”, co-founder and co-CEO Philip Johnston said when asked why Opontia hasn’t been to Africa. “Poland, for example, is six times the size of Egypt. in terms of E-commerce expenses. We are definitely going to Africa; weather only do the biggest markets first. So when you need to prioritize, pick the largest market and then work your way down. In terms of the biggest markets for us are Poland, Turkey, Saudi Arabia, the United Arab Emirates, Nigeria, then Egypt and Pakistan. “
The majority of the ecommerce roll up brands we cover – Raise, Heroes, SellerX, Rainforest, Una brands perch, Berlin brand group, Thrasio, Heyday, The razor group, Branded, Benitago, I guess – Use a similar playbook where Amazon retailers are the hook.
In the areas these companies operate in, Amazon is a ubiquitous marketplace selling goods using its fulfillment arm and Prime service as the infrastructure to fulfill orders. Roll-up companies convince smaller players in the Amazon marketplace to sell their brands, thereby consolidating them into a single brand and managing their operations.
However, Opontia has a slight operational and geographic difference. According to the founders of Opontia, while Thrasio, Berlin Brands, Branded are focused in Western Europe, Opontia has found an opportunity to target brands in Eastern and Central Europe.
In addition, none of these players except Opontia are active in the Middle East. And unlike the more prominent players, Opontia follows an omnichannel model instead of a singular targeting model primarily “FBA” – fulfillment by Amazon companies.
“I think If this is one of our unique values, we will build on our omnichannel setup like a brand house. So compared to Thrasio, that is fully We focus on FBA and focus on three different sales channels – marketplaces, website, Shopify and social commerce,”Co-Founder and Co-CEO Manfred Meyer called.
“So our acquisitions are now like 50% marketplace, but 50% marketplace and Shopify. What we do is how Yes, really such as building a setup in which you can serve all customers direct, not only on the Amazon marketplace. “
When the founders spoke to TechCrunch in June, they mentioned Opontia was in talks with “100+ small e-commerce brands” and claimed to have signed several term sheets.
Since then, the company has acquired four brands including Novimed, a UAE-based direct-to-consumer company that sells medical devices and therapeutic products. Since acquiring Novimed in August, Opontia has quadrupled the brand’s sales and doubled profits.
“Opontia exists because we found that there are many e-commerce entrepreneurs in CEEMEA who are growing their brands to a certain point but now need help taking them to the next level,” said the founders in an email response on the reasons why brands are seeing more and more of Opontia acquired as a viable option. “We give the founder an attractive exit and at the same time allow him to participate in the future growth of the brand’s profit by scaling.” fast”
The company said it would acquire 20 more brands in Eastern and Central Europe and the Middle East in six months. Johnston said at least two-thirds of the Series A investment, about $ 30 million, be used to make these acquisitions.
Opontia has also hired a former executive at Jumia Kenya as Vice President of Operations who will be responsible for the company’s efforts in Africa as it hopes to have offices in Egypt and Nigeria in addition to those in Istanbul, Warsaw, Saudi Arabia and the United Arab Emirates.