Maximilian Bittner among others. It’s already in the process of raising another round of funding and expects to be worth $1 billion in 2023, per co-founder Adrian Johnston.  “We have an 18-month roadmap to unicorn, and we’re on track as it were,” Johnston told Inside Retail. But wait, what’s an aggregator? Despite the fact that billions of dollars have been invested in aggregators around the world just this year, the space is so new that some people are still catching up. Aggregators acquire and scale e-commerce brands, primarily those that sell on online marketplaces, such as Amazon, Shopify and Lazada. Johnston likens them to a standard ‘rollup’ business. The reason so many are popping up now is due to the rise of online marketplaces in recent years and the third-party sellers that populate them.  The numbers behind the business model In 2019, third-party sellers generated roughly 60 per cent of Amazon’s product sales, double the percentage they represented a decade ago, Marketplace Pulse found. Out of the roughly 2 million active sellers on Amazon marketplaces worldwide, Forbes reported that over 30,000 in the US alone are making at least $1 million in sales a year.  Aggregators are now looking to scoop up the most successful sellers and grow their sales several times over by pumping money into marketing and SEO, launching new products and entering new markets, while simultaneously realising cost savings from shared resources in the backend. “The reason it’s such an attractive business model is that when we buy these businesses, we benefit twice. We benefit once from the improved profitability we’re able to get by merging the businesses, but then we also benefit from what’s called multiple expansion,” Johnston explained.  “Typically, we buy businesses for one-times revenue, but when you look at where some of the more developed players in America like Thrasio are trading, they’re trading at ten-times revenue. Just by merging these businesses together, even if you do nothing in terms of increasing the profitability, they’re worth more. And the reason that’s the case is because large businesses are lower risk than small businesses. If you buy one $10 million business and it goes bust, you’ve lost $10 million dollars. If you buy 10 $1 million businesses, and one of them goes bust, then you’re compensated by the size of the portfolio.” Targeting 100 brands Thrasio, which this year was valued at over US$4 billion, owns more than 100 e-commerce brands. Johnston expects Una Brands to reach that milestone in the next year or so. It has already acquired several e-commerce businesses in Australia, where it plans to focus its efforts.  One of them is Kim’s Clocks, a brand of digital waterproof clocks with annual sales of over $1 million on Amazon’s US marketplace.  Since buying Kim’s Clocks five months ago, Una Brands has increased its profitability by 40 per cent. Kim Adams, the Melbourne-based seller who built the brand, remains involved as a strategic advisor.  “We really like sellers to stay on board in a consulting capacity where they might do one day a week of work for us and remain invested in the business through a profit-share model for a given period of time after acquisition,” Johnston said.  “Generally, they’re quite motivated to stay on board. It’s their baby and they’ve grown it from scratch, and they want to continue to input into the growth of the business.” Sellers often have a deep understanding of their market and target customers and bring ideas for new product launches and an overarching brand strategy.   “It would be a shame for us to lose all of that information,” Johnston said.   Fours levers to grow revenue Once Una Brands acquires a brand, there are four main levers it can pull to increase revenue: geographic expansion, channel expansion — such as expanding from Amazon to Shopify or eBay — product expansion and marketing.  “Because we manage a portfolio of a large number of brands, we are able to spot things that are working successfully in one part of the portfolio and then very rapidly roll them out across all the rest of the brands,” Johnston said.  “On the cost side of things, by merging these companies together, you get enormous scale benefits in terms of legal, tech, HR, finance, supply chain procurement and inventory management.”  Juju is a case in point. Started by Brenda Tootell, the Perth-based brand sells menstrual products, including period cups and reusable pads, and was recently bought by Una Brands.  “It’s a very successful business with a strong brand and high customer loyalty, but it’s restricted to the Australian market, and restricted to her Shopify website,” Johnston said.  “We’re very quickly going to be expanding it geographically, and also bringing it onto Amazon.” Untapped potential Johnston believes there are between 5,000 and 10,000 businesses like Kim’s Clocks in Australia – that are successfully selling on Amazon, whether domestically or on the US marketplace, and are ripe for acquisition.  “In terms of non-Amazon businesses, it’s many times larger than that,” he said. “There are many more Shopify sellers than Amazon sellers. I would guess between 20,000 and 30,000.” While there are dozens of aggregators competing to purchase these promising brands globally, Una Brands is currently the only one based in Australia, which could give it an advantage when it comes to local acquisitions. The company is targeting e-commerce businesses that are based in Australia, own their own brands and have between $500,000 and $10 million in annual revenue.  “We are keen on living, baby, pets, outdoor, sports, personal care and wellness,” he said. “The reason we like those categories is because they are non-cyclical, stable and they don’t have high R&D requirements or regulatory barriers.” Despite launching Una Brands just a few months ago, Johnston is ambitious about the company’s future prospects. “You can expect our company might merge with some of the other geographically based businesses,” he said. “The other route for us is to IPO.”  In addition to Johnston, Una Brands’ co-founders include Kiren Tanna, former CEO of Rocket Internet Asia and founder of foodpanda and ZEN Rooms, Kushal Patel, Tobias Heusch and Srinivasan Shridharan.