Boxed.com, the New York-based online household goods retailer, will be opportunist on potential US targets, and could consider an initial public offering in the medium term, according to founder and CEO Chieh Huang.
The targets would be in fulfillment service, technology and robotics sectors. He declined to mention the sum the company could spend on average on each acquisition, or the size range it would consider. It closed its Series D of USD 110m last month and has the financial means to acquire. Proceeds from the latest round would mainly finance the recruitment of a robotics team, but could also be used for M&A.
Boxed.com will consider the IPO on the Nasdaq in a few years, as investors will want to exit at some point. It is difficult to give an exact timing as the e-retailing sector is evolving so fast, especially in the US. In six months the landscape could be completely different. “Four years ago I was still in my garage, starting building a company, so a lot can happen in the next few years.” The executive declined to comment further on the potential listing.
While the company is focusing its activity within the US, it is considering expanding in Asia in the coming months, and that is why it chose Aeon [TYO:8267], a Chiba, Japan-based retail giant, to enter the market, the CEO said. In the next stage, the EMEA market could also be of interest as the e-retailing market is mature there and it could look to build local partnerships with e-retailers to enter it.
Its latest round of financing was led by Aeon, with Alpha Square Group, CDIB Capital, consumer technology investor Gabriel Naouri and existing investors also participating. Previous backers include American Express, Founders Fund, GGV, DST, Bessemer and FJ Labs. Boxed.com raised a total of USD 240m since it was founded four years ago, Huang said.
Earlier this year, the company turned down a USD 400m offer from Kroger [NYSE:KR], the supermarket group in Cincinnati, Ohio, according to a newswire report. Boxed has also been in preliminary negotiations with Amazon [NASDAQ:AMZN], Target [NYSE:TGT] and Costco, but the three did not present bids, the report noted.
He did not respond to comments on those approaches.
Boxed.com competes in the same space as Washington state-based Costco [NASDAQ:COST], and UK online grocery delivery company Ocado, [LON:OCDO], according to the company. Ocado announced this month that it registered an 11.5% rise year on year in its 3Q17-18 retail revenue at GBP 348.6m.
The company boasts an average customer order of USD 100 and average order size of 10 items. It sells bulk items such as toilet paper and pet food, and delivers directly to consumers in the US. It reported USD 100m in revenue last year.
by Emilie Rousseau
As seen in the mergermarket, an Acuris company, newsletter on 28/09/2018