Amazon built its business around access, connecting its millions of sellers with its millions of customers in one simple platform. As we now know, that model was pretty effective. It’s been so effective, in fact, that other brands are building their businesses around Amazon’s business.
Brands that exist solely to buy and scale other brands — aggregators, as they are sometimes called — are all the rage right now among big-money investors. Last year, Thrasio, which acquires and scales businesses on Amazon, became the fastest U.S. company to reach unicorn status, but the company is just one of dozens in the aggregation space that have received nine-figure investments over the past two years.
Now we can add Bay Area-based Heyday to the list. The brand-building platform just announced that it raised over half a billion dollars in a Series C funding round co-led by The Raine Group and Premji Invest. Heyday will use the funding to continue to shore up its business model, which centers around buying direct-to-consumer brands and scaling them leveraging the Amazon Marketplace.
The company has declined to share its valuation, but a source familiar with the matter told Bloomberg that this latest funding round of $555 million pushed Heyday’s valuation over the $1 billion mark.
“Marketplaces like Amazon have democratized e-commerce creation, making it easier than ever before for consumers to discover innovative new products and brands,” said Sebastian Rymarz, co-founder and CEO, in a press release. “We’re excited to partner with these amazing entrepreneurs and leverage our platform capabilities to help them make the great leap from marketplace-native brand to household brand.”
Heyday acts as a digital incubator for brands that got their starts on marketplaces, helping them engage in omnichannel sales, expand their product offerings and build brand equity. Once acquired, brands on the Heyday platform are partnered up with an e-commerce entrepreneur and are given access to technology, data, supply chain and growth capabilities.
Specifically, Heyday’s Series C funding will go toward investing in its brands, building out its technology platform, increasing its logistics footprint and, of course, acquiring more brands. The company also filled three leadership positions with CFO Navid Veiseh, CMO Reema Batta and CAO Todd Heeter. The round comes in the wake of Heyday’s $70 million Series B in May, and it has now raised $800 million since its founding in 2020.
It’s been a year of rapid growth for the Bay Area brand builder, which has scaled globally by adding a seventh office in China and invested heavily in marketing, supply chain, operations, technology, data science and M&A. According to Rymarz, that’s put the company on a path to achieve $200 million of run-rate revenue by year’s end.
“We have been exceptionally impressed with Sebastian and his team, their vision and commitment to operational excellence for the next generation of consumer brands,” said Jake Vachal, managing director at The Raine Group. “Heyday’s innovative approach to growing and incubating brands provides entrepreneurs access to leading technology, as well as deep-rooted expertise spanning operations and marketing. We are excited to be partnering with this team as they continue building a differentiated platform for quality, digital-first brands.”
It’s clear that Heyday’s way of doing business has caught on among investors. Thrasio, the company often credited with pioneering the aggregator model, locked up a massive $1 billion Series D last month that placed its valuation somewhere between $5 billion and $10 billion, while another U.S.-based company, Perch, joined the unicorn club in May.
But that’s just scratching the surface of the massive global market for brand incubation. Just look at Paris’ Branded or Berlin’s Razor Group or London’s Heroes, all of which have nabbed nine-figure funding rounds this year.
What sets Heyday apart from these other brand builders, though, is its size — or, rather, the size of its portfolio. Whereas unicorns like Thrasio and Razor Group each have more than 150 brands in their stables, Heyday has just 15, prioritizing quality over quantity. Rymarz told TechCrunch that five of those 15 brands make up over 70% of Heyday’s revenues. It’s that selective approach that’s drawn investors in.
“Heyday’s differentiated strategy and world-class team stand-out in what is playing out to be one of the most explosive new industries,” said Sandesh Patnam, managing partner at Premji Invest. “We are excited to partner with the leadership team to help Heyday leave a mark on the e-commerce space.”