Accel Club - Amazon Business Acquirer
Inspired by US brand Thrasio, Accel Club acquires and grows successful brands from Amazon.
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Headquartered in Amsterdam, Accel Club buys brands that have become successful on Amazon and develops them using the technologies and resources of its platform. When shortlisting potential acquisitions, Accel looks for high quality brands with significant growth potential.
The startup was founded in 2021. It has offices in Europe, US and China. Accel Club has raised a total of $170M in funding over 2 rounds. Their latest funding was a Series A raised in November 2021.
Business Overview & Products
When buying and scaling businesses that sell on Amazon, Accel Club offers tailored terms and proposals for a smooth acquisition process. Accel aims to boost growth of e-commerce brands leveraging its technology and tools. The startup’s operations are mainly centred on the US market. However, it plans to expand to European and Asian markets soon.
A business deal is normally closed in 30 days. A deal starts with a short intro call, followed by the signing of an NDA and a deeper inspection of the business. If Accel approves of the business, it proceeds with a letter of intent and due diligence which takes about 2-3 weeks. Finally, all legal papers are signed and funds are disbursed.
Accel Club currently sells about 1,100 items across seven marketplaces. The Amazon brands it buys have around 60% of sales coming from Amazon versus other platforms like eBay.
How It Works
Accel looks for brands that are primarily sold on Amazon FBA, and looks for product categories that are enduring and non-seasonal in nature. The product should be a leader in its respective category, with a high number of reviews and ratings higher than the average. It considers all opportunities but focuses on brands with at least $1M in revenue in the last 12 months.
When Accel Club strikes deals with these Amazon businesses, as part of those deals, sellers stay on as advisors or consultants. They receive two earn-out payments over two years, which is tied to the brand's success. The startup also absorbs teams from sellers, with a trial period between 3-6 months to ensure individuals fit within the existing culture.
Once a business is acquired, the growth process goes through multiple steps. Risks are hedged through a portfolio of products and economies of scale are achieved on the backend of operations. There is a re-focus from current yield to long-term growth, as well as a multichannel boost and geographical expansion. Lastly, the strategic and operational management is enabled by Accel’s high-end technology.
Business Model & Pricing
Accel Club acquires brands and rolls them into a single business. They aim to grow the businesses they acquire and improve EBITDA by increasing sales through optimizing growth and by aiming to reduce costs by leveraging a shared infrastructure and aiming to bring costs down with scale. As the portfolio of companies grows, it permanently increases the leverage capacity of Accel.
The pay-outs received by acquired businesses are tied to revenue rather than EBITDA. There are no broker fees while valuations are holistic, and payments are arranged in less than 4 weeks. Accel also pays out referral fees – paid to someone who introduces Accel to another worthy seller. It has already paid millions in referral fees.
After acquiring and scaling e-commerce businesses, Accel Club boasts the following statistics of EV/EBITDA growth:
>40x for D2C companies
28x for consumer companies
15x for FMCG companies
3-4x for 3rd party sellers
The startup uses about 100+ useful tools for gathering data, such as Helium10, Keepa, Fakespot and more. Generally, the automated gathering of relevant financial, product and market data ensures fast due diligence and execution.
Max Firsov (LinkedIn): Co-Founder and CEO. Max is a serial entrepreneur with more than 15 years of experience in e-commerce. Prior to Accel Club, Max has served as CEO at Yandex Eats.
Nick Tuzenko (LinkedIn): Co-Founder and Managing Director at Accel Club. Nick has a background in management consulting. He has served as an advisor to the board at Bioloka Holding OU.
History and Evolution
Accel Club was founded in February 2021 and headquartered in Amsterdam. It began as an online startup that buys and integrates Amazon businesses onto its platform and boosts their sales through branding and technology. Co-founders Max and Nick were inspired by US brand Thrasio and decided to take a shot at the ecommerce market in 2021.
Since its inception in February 2021, the startup has witnessed a very strong growth. In 9 months the company has reached tens of millions of dollars in annual recurring revenue, while expanding the team to approximately 100 employees. According to the co-founders, they are hoping to invest 10-20 years of their lives in as they want to build a global player.
After the latest round of funding, Accel Club plans to use the cash to invest in automating its processes.
Deal sourcing is built to process potential targets in days and close deals in weeks. The post acquisition activities increase 3rd party sellers’ business valuations by 5x.
The difference between an acquired firm’s starting EV and exit EV comes from multiple sources. As a brand is scaled and grown, key factors that come into play include revenue improvements, cost improvements, financing of working capital and multiple arbitrage.
The Amazon ecosystem as of 2021 pulls up $295 Billion from third party sellers’ revenue. It also consists of 62% Amazon GMV, with 30% 10-year CAGR.
Of the 3rd party sellers on Amazon, there are roughly 8 million sellers that are registered, 2.1 million that are active and 250k sellers with sales greater than $0.1 million. 3rd party sellers have been the key for Amazon growth and thousands of them are ready to sell their businesses at 3-4x EV/EBITDA.
Suggested Next Reads
Accel Club is the latest startup gobbling up Amazon Sellers (Business Insider, November ‘21)
Amsterdam-based Accel Club raises €151.45M in equity and debt funding (Silicon Canals, November ’21)