Heyday Raises $175 Million To Buy Amazon Businesses—The Latest E-Commerce Gold Mine

A San Francisco-based company called Heyday has raised $175 million from General Catalyst, Khosla Ventures and other investors to buy, launch and grow Amazon businesses.

It’s the latest company rushing to bet on Amazon’s third-party sellers, which now generate roughly 60% of its product sales, up from 3% in 1999 and 30% in 2008. While these sellers from the backbone of the largest e-commerce marketplace in the nation, most of them remain small. Deep-pocketed investors have spotted an opportunity to roll up dozens or hundreds of Amazon-native brands, pool resources and invest behind them to goose sales and profits. The largest acquirer of Amazon third-party sellers is Thrasio, which has raised over $500 million and was valued at $1 billion in July. Other companies, like Perch and Boosted Commerce, have also announced significant funding in recent months to pursue Amazon roll-ups.

Heyday, which has been operating in stealth since it was started earlier this year, announced on Wednesday it has raised a Series A funding round. Arbor Ventures and executives from Amazon, eBay, PayPal and Magento, including PayPal CEO Mark Britto and former Magento CEO Mark Lavelle, participated in the round.

The company has already acquired and launched several brands in categories like home appliances, furniture and beauty. It expects to generate $20 million of annualized revenue by the end of the year, and cross $200 million of annualized revenue by the end of 2021.

It is building technology to help run its growing portfolio of brands, like figuring out when to ramp up advertising, adjust price and how much inventory to order. It eventually plans to sell this technology to third-party sellers who aren’t interested in selling their business, but want to upgrade their operations.

“We want Heyday to become the place that anyone creating a company or selling on Amazon or other marketplaces comes to,” says Mark Crane, a partner at General Catalyst.

Sebastian Rymarz started Heyday this summer after a six-year stint at Fundbox, a fintech that offers lines of credit to small businesses, and seeing how many entrepreneurs struggled to get working capital they needed to grow. Those who sold on Amazon were often solo entrepreneurs working out of their homes and lacked the capital and technology to scale their businesses to the next level.

“Amazon provides a lot of tools, but there are still some very big gaps,” says Rymarz, 36. “We are building an e-commerce platform to make brands boom on marketplaces like Amazon.”