In Greek mythology, Thrasos is the character that personifies boldness. Drop the ‘os’ and add an ‘io,’ and it’s a company that personifies the fast track to digital commerce success. Thrasio has taken its Amazon-centric business model to a high level at high-speed, snapping up some of the marketplace’s hottest sellers and creating a company that one of its investors says is “revolutionizing eCommerce.”
“For us, the revolution starts with the market,” said Co-founder and CEO Joshua Silberstein. “The market is fundamentally changing, and as the market changes, so do the sources of competitive advantage. Our job is is to be among the first to understand where those sources of competitive advantage are in this new, evolving market, and then execute on it.
"We’re trying to be the company that understands what's happening the fastest, and uses the market change as a cauldron where we can quickly experiment, figure out what's working and develop ways of doing things that are better than what other people can do," he added.
What Thrasio is doing better than anyone else right now is making a business out of buying Amazon businesses, which it then onboards, optimizes and operates. In mid-July, it announced it had raised $260 million in a Series C round led by Advent International, one of the largest global private equity investors. That round was raised against a $1 billion valuation, leading Thrasio to claim that it is the fastest-ever U.S. company to reach profitable unicorn status. In fact, it has been profitable since it was founded in July 2018, with its revenue doubling (on average) every 73 days. To date, Thrasio has acquired more than 50 Amazon businesses, including 17 in Q2. With over $300 million in pro forma revenue and 6,000+ products, it is one of the top 25 sellers on Amazon.
According to Silberstein, the company evaluates its potential acquisition targets by putting themselves into the consumer’s shoes. Selling and rating metrics count, but the company is focused on selling what Thrasio believes to be a great product, something a consumer would be excited to unbox. Then the company has to consistently deliver it. The value proposition for the consumer must be clear and simple.
After an acquisition, Thrasio likes to keep the founders in place to help them onboard and download their intimate knowledge of the company. Then there’s a checklist of 503 items that the Thrasio team applies to their new acquisition — from operations to platform compliance to product specs and marketing practices. It also does a complete inventory and supply chain overhaul. When the company is integrated into the Thrasio family, suppliers and shipping sources are also optimized.
“We do a complete marketing overhaul,” Silberstein explained. “We tend to dismiss what they've done historically and turn it into something that fits our mold and has worked for us. There's a strategic planning process where the Thasio brand manager gets a document that details the history of the product, including its competitors, ranking, threats and opportunities. By the end of that process, everything is up to standard, and we can hand it to a brand management team and they can run with it.”
Silberstein said he doesn’t play favorites among the 67 businesses the company currently operates. He does like to tell the story about the company that had a $20 million annual business, which Thrasio doubled after just 10 days. While it might seem that the pandemic would have added some urgency for sellers to sell their companies, Silberstein said the exact opposite has happened. Amazon sellers have seen such a spike during COVID-19 that it’s actually harder to agree on a valuation because, as he put it, “no one really knows what’s going to happen with the pandemic.”
Regardless of the post-COVID outcome, Silberstein is passionate about Amazon as an economic driver for retail.
“In many ways, Amazon is the most underappreciated company in America,” he said. “Now they've stepped up and figured out how to supply America with everything at a point when not a lot of retailers can do that. They've got an ecosystem that's created thousands of American millionaires, and you don't hear that story very often. You don't really hear that they've probably had a meaningfully positive impact on inflation and given the American consumer better value for their money. They're not perfect, but I don't think they're in the same bucket as Facebook, Google and Apple. After all, what would have happened if Amazon had closed their doors three months ago? Where would people have gotten their stuff?"