#167 – Mercari’s controversial fees, expiration dates, and Overstock’s comeback

by Shopifreaks | Apr 1, 2024 | Recent Newsletters

Hi Shopifreaks!

I've got a very big edition for you today — even by my standards! So let's keep this intro short and dive right in.

In this week's edition I cover:

Mercari's controversial fee changes
Inflation hit Americans hard post-COVID
“Best if used by” versus “Use by” dates
Overstock is back from the dead
Amazon is fined for using dark patterns
China's TikTok launched a standalone shopping app
Google will now help you dress better
Visa and Mastercard reached a $30B settlement
A pregnant Nigerian woman was arrested for reviewing a can of tomato puree
The odds of a Shopify store existing 12 months from now

All this and more in this week's 167th Edition of Shopifreaks. Thanks for subscribing and sharing!

PS: This should be the last week that I send an edition without source links. Sorry for the inconvenience, which is due to deliverability issues with MailChimp. As a reminder, the source links are available on the web edition and LinkedIn version.

Stat of the Week

Over the last 4 years, a store that installs from the Shopify App Store has a 54% chance of being closed within 12 months. This number has been rising into the 60% range last year and continues to climb. — According to Stuart Chaney, CEO of Rivo

1. What's going with the new Mercari fees? Yikes!

Mercari, the Japanese marketplace that allows users to buy and sell new and used items, made some big changes to their fee structure in an attempt to attract more sellers to its platform and better compete with secondhand competitors like Poshmark, Depop, and ThredUp.

The result: they may be turning off buyers and sellers alike.

Here's a recap of the changes from last week:

Mercari is eliminating the traditional seller fee on items sold, which used to be 10% plus a 2.90% + $0.50 payment processing fee.
The platform is instead passing those fees onto buyers with a new “service fee” and “payment processing fee” that are added to the customer's total at checkout. The payment processing fee is waived if the buyer uses their Mercari balance.
The new buyer service fee starts at 10%, but can be as low as 5% depending on the brand, item category and other product details.
They also launched a new returns policy allowing buyers to initiate a return within three days for any reason with the assurance of a refund, less applicable fees. Previously Mercari had a strict no refunds policy.
Transferring funds from your Mercari balance to your bank checking account now costs $2.00, which used to be free. They've since backpedaled this change after both buyers and sellers filed complaints with the FTC.

Here are the problems with the changes:

Mercari buyers now feel like they're shopping on Airbnb — where the price they see upfront drastically changes by the time they reach checkout. Between the delivery fee, service fee, payment processing fee, and tax, the cost of an item on Mercari can rise by as much as 25% between add to cart and checkout.
Buyers seem to prefer when those costs are hidden within the list price of a product. Other than a delivery fee, buyers knew exactly what they were going to pay before entering checkout, and that made purchasing decisions easier.
The new fee structure may actually end up costing buyers more than before. After all, how many sellers immediately took 10% off the cost of their items after the change? Not many, I'd imagine. So now buyers are still paying the item cost which formerly took into account the seller and payment processing fees, and then paying those fees again on the buyer-side.
The new fee structure may also end up costing sellers more than before too in the form of lost sales. If buyers abandon checkout more frequently due to all these fees popping up in the final hour, that will cost sellers a lot more than a 10% seller fee and payment processing fee.
The $2 direct deposit fee can also cost sellers of small items more than the previous seller fee. For example, $2 to withdraw the proceeds of a $10 sale ends up costing the seller more than they were paying before between the seller fee and payment processing fee. (Granted they temporarily stopped charging that fee, but it could be back.) I understand Mercari's goal of trying to keep buyer and seller funds on the platform to encourage more trading, but they should have done this by incentivizing users to keep funds on the platform, not by disincentivizing users to remove them!
Mercari tried to position this new fee structure as if they were revolutionizing marketplace shopping. Mercari U.S. CEO John Lagerling said about the changes, “We decided that the boldest thing we can do is to simply go ahead and abolish the selling fees.” However technically they didn't abolish anything. They simply passed the fees onto the buyer instead and made them more visible.

This whole disaster feels like it could have been averted by pitching these changes to a very small focus group of buyers and sellers who would've been like, “Uh, no?!”

On the flip side of the PR coin, many folks are hearing about Mercari for the very first time, so maybe it's one of those “new press is bad press” scenarios.

What are your thoughts on the Mercari fee changes? Hit reply and let me know or join the convo on my LinkedIn post.

2. Inflation hit Americans hard!

The average US household now spends 19% more than they did in 2019 to survive, according to a report published from Doxo, a payment platform for household bills. Here's what the report found:

US households now spend $25,513 a year, which is 34% of the median household income, on the 10 most common bills which include mortgage, rent, utilities, auto loans, auto insurance, mobile phones, health insurance, life insurance, security, and home Internet access.
This number is up 4% from a year ago and 19% since 2019, however median US household income was up just 0.2% in the past year and 14% since 2019.
The average mortgage payment is now $1,402, up 11% from 2019.
The average rent payment is $1,300, which is up 27% from 2019.
Average car payments are up 33% to $496 in the same time period.
The monthly cost for utilities now averages $362, up 25% since 2019.
The cost of owning a cellphone jumped 29% while health insurance went up 30%.
Some of these increases can be attributed to rising interest rates.

Lynnette Khalfani-Cox, a personal finance expert, told Business Insider that these common household bills are just one piece of the picture showing the current cost of living.

She noted, “Things like credit card bills, student loans, and even buy now pay later obligations increasingly consume a big chunk of people's budgets.”

Khalfani-Cox also pointed to escalating food prices and inflation at the grocery store, which peaked at a 13.5% inflation rate in June 2022.

How does this affect e-commerce sales? Less discretionary income.

The US economy has been artificially kept afloat during the past few years with bailouts, stimulus packages, consumer credit, and BNPL installments, however, eventually we can't keep kicking the can down the road and this money train will come to a screeching halt. The handwriting is on the wall and the numbers above speak for themselves.

The lesson for e-commerce retailers is to not overextend yourself right now unless your margins can justify it. Past sales don't guarantee future revenue. Careful not to get trapped in the spiral of growth for the sake of growth, where you're giving up a substantial piece of future revenue to platform lenders in exchange for increasing your inventory with the assumptions that it'll move as fast as it has in the past or that your customer LTV will remain as high as it's been during the past few years.

3. Are you throwing away perfectly good food?

Walmart, Amazon, Whole Foods, Kroger, Nestle, and over a dozen other retailers are encouraging Congress to pass legislation that would require two food labels: “best if used by” and “use by.”

Currently there are nearly 60 types of date labels that appear on food and drinks in US grocery stores, and no federal regulation of date labels. Food expiration dates differ from state to state or are often left up to the manufacturer's discretion — which can cause a lot of confusion for customers.

This confusion is estimated to be responsible for about 7% of the 78M tons of food wasted across the country each year, according to ReFed, a national nonprofit whose mission it is to end food waste.

This waste has a cost, which as you saw in story #3 above, consumers could do without right now! The Agriculture Department estimates that the average family of four loses about $1,500 a year to uneaten food.

To solve this problem of food waste, about three dozen members of Congress have sponsored legislation known as the Food Date Labeling Act of 2023, which would require manufacturers to only use the “best if used by” and “use by” labels, thus standardizing how consumers gauge whether their groceries are suitable for consumption.

Jerry Seinfeld actually did a whole bit on this back in the 90s. “How do they know that is the definite exact day? They don't say ‘it's in the vicinity', ‘give or take', or ‘roughly', they brand it right into the side of the carton… Ever have milk the day after the day? Scares the hell out of you, doesn't it?”

Personally, I think if we're going to take the time to create legislation over a decades-old issue that comedians have been joking about for more than 30 years, we should bring it up to 2024 standards and require scannable QR codes or barcodes that digitally communicate those two dates. That way retailers, especially e-commerce grocers, can more efficiently move older inventory out the door, reduce fulfillment center food waste, and incentivize customers to purchase products nearing their expiration date in exchange for discounts. A win-win-win.

4. Overstock is back and partnering with X

Overstock.com is back! Wait, it left?

Here's a recap of what went down this past year:

Last July, Overstock.com bought the Bed Bath & Beyond brand from bankruptcy for $21.5M and adopted the name.
Within a week, the company had relaunched the Bed Bath & Beyond domain in Canada, followed by a refreshed website in the U.S. a few weeks later.
From that point forward, customers in the U.S. and Canada who visited Overstock.com were redirected to bedbathandbeyond.com, which began selling furniture and home décor in addition to bed sheets and cooking ware.
Overstock.com CEO Jonathan Johnson said at the time, “Bed Bath & Beyond is an iconic consumer brand, well-known in the home retail marketplace. The combination of our winning asset-light business model and the high awareness and loyalty of the Bed Bath & Beyond brand will improve the customer experience and position the company for accelerated market share growth.”
Flash forward 7 months and the company deeply regrets the decision to change brand names.
Marcus Lemonis, executive chairman of the board, said that in hindsight, shutting down their website was a “fatal mistake.”
The company announced in February that it would be returning to its old name and running the two websites independently.
Lemonis said, “Turning Overstock.com back on will not only allow Bed Bath & Beyond to expand its existing assortment and hone in on its historical legacy success, but it allows Overstock to do the same.”
A few weeks ago I reported that Beyond, Inc, the name of the combined entity that now owns Overstock and Bed Bath & Beyond, acquired the intellectual property and other brand assets of Zulily for $4.5M, to complete their trifecta of failing consumer brands.

Daniel Sodkiewicz of GeekSeller wrote a LinkedIn post the other day about how all those redirects and domain changes may have hurt Overstock and BB&B's SEO rank. That was actually my first thought last year when Overstock made the announcement that they were rebranding!

I remember thinking, “Wait, so rather than have two top tier domains ranking for high converting product listings and category pages, with collectively thousands of internal links coming into the two sites, you're going to set one of those domains on fire in favor of doing business under a brand name that previously wasn't strong enough to survive on its own?”

Overstock.com may have learned its lesson, but that doesn't mean it can simply hand Google a “do over” card and get back all its old search rank overnight. It'll be an uphill climb from here.

Overstock + X: In addition to announcing its relaunch, Overstock also announced that it's partnering with X to deliver custom short and long form content, develop customer acquisition and retention strategies as well as spotlight the companies' brands on key tent-pole events and holidays.

Does that make Overstock a right-leaning company now by association? I'm not sure how that works now…

Lemonis said, “We are thrilled to be an integrated partner with X as they help us engage more effectively across their 100 million plus U.S. users with both creative content and brand-specific promotional messaging. We recognize the power of the X platform and level of engagement users have with it.”

5. Amazon fined in Poland for using dark patterns

Last year in Edition 114 (story #4) I reported on the use of dark patterns within the e-commerce industry.

Dark patterns are defined as deceptive UI designs that are intended to trick users into making non-favorable decisions. Examples include:

Trick questions like, “Are you sure you don't want to keep your membership?”
Confirmation shaming like, “No thanks, I prefer to pay full price like an idiot.”
Highlighting the “No / Keep My Subscription” button in bright green, while the “Yes / Cancel My Subscription” button is next to it in light grey.
Switching the order of the Yes / No buttons as a user goes through multiple steps to cancel their subscription.

E-commerce companies are no stranger to the use of dark patterns:

Amazon had to make it easier for Prime members to cancel their subscriptions a couple years ago, following complaints from consumer groups about the numerous hurdles it took to cancel the service.
Epic Games was fined $520M in part for using dark patterns to coerce players into making unwanted in-game purchases.
Block came under heat at one point for making it difficult to opt-out of marketing e-mails from brands you've never shopped with before by employing dark pattern designs to bury the opt-out link.
There's even a dark pattern named after Mark Zuckerberg called “Zuckering” which fools users into thinking that they need to share certain private information, even if it is not necessary to use the service.

Amazon has now been fined $8M by Poland for its use of dark patterns that injected a false sense of urgency into the purchasing process and misled shoppers about product availability and delivery dates.

Poland says:

Amazon misled users into believing that placing an order or receiving an order confirmation was tantamount to a sales contract. However in fact, it is merely an offer to purchase the product and Amazon is entitled to cancel the order if it wants. The contract only actual goes into effect when Amazon makes the actual shipping notice.
Amazon also displayed countdown timers to users which implied that they would receive an order on a certain date if they placed it within a certain time frame. This placed pressure on the consumer to buy as soon as possible, however, Amazon would often fail to meet those shipping deadlines after presenting them as a guarantee.
Amazon's “guaranteed delivery” date, which was intended to deliver a product to the customer within a certain amount of time or issue a refund, was not clearly explained to users before they placed orders, which meant that customers were often unaware of their rights.

Amazon's press office in Poland responded with a statement:

“Over the last year, we have collaborated with the Office of Competition and Consumer Protection (UOKiK), and proposed multiple voluntary amendments to continue to improve the customer experience on Amazon.pl. We strictly follow legal standards in all countries where we operate and we strongly disagree with the assessment and penalty issued by the UOKiK. We will appeal this decision.”

6. China's TikTok launches a standalone shopping app. Pay attention USA…

Douyin, the Chinese version of TikTok owned by the same parent company ByteDance, launched a standalone app for its booming e-commerce business.

The new app, called Douyin Mall, was launched last week for Android users in mainland China with the slogan, “Choose great bargains with little effort.” There is currently no iOS version yet.

Screenshots of the new Douyin Mall app reveal a new emphasis on ultra-low price products. After entering the Mall app, users are greeted with a traditional shopping interface that offers a search bar, categories, as well as low-price flash sales, live streaming selections, and value-for-money purchases. Users can access short video content from within the Mall app just as they can on the main app, but the video shooting and editing features are absent.

A Douyin representative said that the new app serves “as an extension of the Douyin platform, designed to elevate the overshall shopping experience of existing users.”

Online shopping via Douyin started in 2019 as a click-and-buy function within the short video app, similar to how TikTok Shop has launched in the US. ByteDance decided to also make an independent app to compete head-to-head with Taobao, Tmall, JD.com, and Pinduoduo, which are more traditional shopping apps, as opposed to exclusively having shopping integrated within videos.

Is this a sign of what's to come in the US? Is ByteDance's long term goal to launch a dedicated shopping app in the US market as well, after it gains some e-commerce traction with TikTok?

Perhaps ByteDance is more concerned with doing so in the US as a means to maintain market share if/when TikTok the social app gets banned in the country, and it's simply using Douyin Mall in China as a testing ground to see how merchants and users react.

To everyone who ever said anything like, “TikTok will never replace Amazon. People use it differently.”

Well, well, well.. how the turntables.

7. Dress yourself with Google style recommendations

Google began rolling out a feature that gives shoppers more personalized shopping results. Users can now rate different products in order to get style recommendations when shopping for apparel, shoes and accessories.

Oh great, just what everyone needed — the team from Google giving fashion advice. hahaha

For example, when users search for certain clothing, shoes, or accessories like “straw tote bags” or “men's polo shirts”, they'll be presented with a section labeled “style recommendations.”

From there, they can rate options with a thumbs up or thumbs down, or a swipe right or left, and instantly see personalized results.

If after all that, you haven’t found what you’re looking for, Google will allow you to rate even more items and see additional results. It will then remember your preferences, so if you ever search for men’s polo shirts again, you will see style recommendations based on what you liked in the past — which is perfect because our tastes as consumers never change.

The new feature is rolling out to all U.S. shoppers using mobile browsers and the Google app. Google did not say if it plans to expand the feature to more countries.

8. Visa and Mastercard reach a multi-billion dollar settlement

Mastercard and Visa reached a multi-billion dollar settlement that aims to end 20 years of antitrust litigation around swipe fees and restrictions placed on merchants. The antitrust settlement is one of the largest in U.S. history, and if it receives court approval would resolve most claims in nationwide litigation that began in 2005.

Here's what will change:

Swipe rates will be reduced by at least four basis points for three years, and ensure an average rate that is seven basis points below the current average for five years.
Merchants will gain more choice in how they accept digital payments, including allowing them to steer their customers to the merchants' preferred payment methods and placing surcharges on purchases made with credit cards.
Merchants will now be able to raise their prices based on the kind of card. For example, buying groceries with a higher-fee card like the Chase Sapphire Reserve could become more expensive than paying with a lower-end one. Retailers will have the freedom to charge more for the use of rewards cards.
The rollbacks and caps on swipe fees are expected to deliver at least $29.79B in savings during the five years after the settlement is approved.

Subject to approval by the court, the rules changes will likely be implemented in late 2024 or early 2025.

For credit card holders: The biggest change could be that it becomes more expensive to use premium cards. Historically merchants have bore the cost of higher fees associated with premium cards, but now they'll have the option of kicking those fees back to the customer.

Will they? That's to be determined. Merchants may decide that it's not worth ticking off their customers by imposing higher fees for certain cards and continue to absorb the costs. Implementing and communicating a tiered fee structure based on payment type may also prove to be a challenge for merchants.

9. Other e-commerce news of interest

A report by The Consumer Financial Protection Bureau revealed that consumers have increasingly been the targets of fraudulent account openings and purchases, particularly with installment lenders like BNPL, which represented 65% of all reports in the personal lending segment. Complaints ranged from being charged interest and/or fees that the borrowers said that they did not expect to not receiving ordered items and still having to pay back the loan.

Estée Lauder launched its cosmetic brand Clinique on the Amazon Premium Beauty store last week, making Clinique its first brand to sell its products on Amazon, but not its last brand, according to the company. Amazon Premium Beauty store is a category on the site that caters to big brands and professional beauty products that are generally sold in luxury retail stores.

Colin Huang, founder of PDD Holdings which owns Pinduoduo and Temu, surpassed Tencent and ByteDance founders as China's richest tech billionaire after a surge in the value of PDD's US-listed shares. The 44-year-old grew his wealth by 71% to $53.4B from a year earlier, according to the annual Hurun Global Rich List 2024 released last week. China remains the country with the most billionaires globally, but the pool has shrunk by 155 to 814 over the past 12 months.

McAfee warned users about five malicious Chrome extensions, currently installed on over 1.4M devices, that are designed to track users' browsing activity and inject code into e-commerce platforms. The extensions can modify cookies on e-commerce websites so that their creator receives affiliate payments for the purchased items, without the victim's knowledge.

Remember Facebook Watch? Court filings unsealed in Meta's antitrust lawsuit claim that “Watch” was kneecapped in 2018 to protect Facebook's advertising relationship with Netflix. From 2011 to 2019, Netflix was allegedly granted special access to Facebook users' private message inboxes, among other privilege analytics tools, in exchange for hundred-million-dollar advertising deals, which was incentive enough for Facebook to retreat from its own streaming aspirations.

Walgreens CEO Tim Wentworth said during an appearance on CNBC that human connection will help the pharmacy compete with Amazon's healthcare aspirations. The CEO claims that Walgreens is in a strong position compared to Amazon because of its 8,600 locations, which give customers the ability to discuss medications and health concerns in-person. Wait until he finds out that consumers don't really care about talking about their intimate health concerns in person, with a line of other patients impatiently waiting behind them!

Kroger is closing three e-commerce facilities — one in South Florida and two others in Texas. The grocer says that despite its best efforts in the regions, the facilities did not meet its benchmarks for success.

Four of the largest school boards in Ontario are suing TikTok, Meta, and SnapChat for allegedly disrupting student learning. The lawsuit claims that the social media platforms are “designed for compulsive use, have rewired the way children think, behave, and learn” and that teachers have been left to manage the fallout. Rachel Chernos, a trustee for the Toronto District School Board, said, “These companies have knowingly created programs that are addictive that are aimed and marketed at young people and it is causing significant harm and we just can't stand by any longer and not speak up about it.”

Robinhood launched a new Gold Card that offers the ability to invest cash back perks. The card has no annual or foreign transaction fees, other than the cost of being a Gold member for $5/month or $50/year, which offers other benefits like access to a 5% HYSA. Gold Card users can earn 3% cash back on all categories and 5% cash back when booking travel on Robinhood's new travel portal. (Robinhood has a travel portal now?) The card also allows users to create and delete virtual cards for one-time purchases.

Amazon will now let you sign up for its palm recognition service from your phone via its new Amazon One app, which can take a photo of your palm and set up your account. The company says that your palm and vein images are “immediately encrypted” and sent to a “highly secure zone” in the AWS Cloud that’s specifically built for Amazon One. Previously, users were required to visit physical locations to enroll in the service.

Data from Fakespot shows a bizarre rise in the number of listings for bug zappers on Amazon over the past three years, as well as an increase in the number of negative or unreliable reviews for this product category. Fakespot founder Saoud Khalifah says bug zappers are just one example of the convergence of recent trends in e-commerce, where merchants seek to sell low-cost products with high margins, and generative AI tools make it easier for sellers to churn out questionable marketing copy and reviews.

ShopeeFood in Vietnam changed its non-compete policy prohibiting workers from signing up with rival delivery apps after Rest of World reported on the issue. Delivery drivers were previously having to buy two phones so that they could log on to a rival app and work both simultaneously, in fear that Shopee would detect a rival app on their primary phone, which Shopee had the technical capabilities to do.

Amazon plans to spend almost $150B in the coming 15 years on data centers to give its cloud division firepower to handle an expected explosion in demand for AI applications and other digital services. Amazon currently holds about twice the market share of its closest competitor, Microsoft, in the cloud services market, and aims to keep that position.

A pregnant Nigerian woman was arrested and is facing imprisonment for allegedly breaching the country's cybercrime laws after writing a negative review for a can of tomato puree, which she claimed tasted too sugary. The manufacturer, Erisco Foods, accused her of making a “malicious allegation” that damaged its business.

Amazon is launching same-day delivery of prescription medications in New York City and Los Angeles, with plans to expand the offer to more than a dozen cities by the end of the year. The prescriptions are offered via Amazon's online pharmacy service, which launched in 2020 and was born out of the company's 2018 acquisition of PillPack. To speed up deliveries, Amazon said it's using new, smaller facilities, stocked with the most common prescription medications for acute conditions.

Advertisers are suing Meta for damages exceeding $7B, accusing it of inflating its social platforms' Potential Reach metric by up to 400%. They claim that the metric included bots and other fake accounts, rather than individual users, leading to artificially high premiums for ad placements. The case, which was originally filed in 2018, encompasses millions of advertisers, and will either proceed to trial or potentially be resolved through a settlement.

Speaking of ads transparency, Amazon will now have to provide information about ads running on its platform in a publicly accessible online archive, following a decision by the European Union's highest court. Other tech giants have complied with the DSA requirement, but Amazon filed a legal challenge to its designation last year and was granted a temporary suspension on the ad library element, until now.

In other news of Amazon facing the music, The Wisconsin Supreme Court ruled that some delivery drivers for Amazon Flex are now to be regarded as employees, not independent contractors, which makes them part of the state's unemployment insurance system and entitled to jobless pay if they are laid off. The decision means that Amazon Logistics will likely be hit with a tax bill of more than $200k. Other states are also looking into Amazon's classification of drivers.

ByteDance shut down LetsChat, its WhatsApp clone that it launched in Africa in 2021, which had over 7M downloads across the continent. The company finally conceded that its app had little chance of success against WhatsApp, despite several years of investing in local promotion.

Instacart is launching a new API program called Instacart Developer Platform, which will enable third-party players to launch apps that integrate with its grocery shopping platform. Through the program, developers will gain access to Instacart's product selection and real-time store data, enabling them to offer features like same-day delivery and personalized meal planning. The first round of partnerships will include an integration with New York Times Cooking to make recipes shoppable, a WeightWatchers integration to purchase recommended foods, and an integration with GE Appliances to make products such as ovens offer shopping capabilities from their touchscreens.

Amazon reported that it invested $1.2B into fighting counterfeits last year and had over 15,000 employees dedicated to preventing abuse of its platform. The company also claimed that its Counterfeit Crimes Unit took action against more than 21,000 bad actors since 2020 by either reporting them to law enforcement or suing them.

Tidbyt, which manufactures a retro-style smart display that displays the time, weather, and other notifications from your phone, claims that Meta lost $40k of its advertising dollars and suspended their advertising account until they wire them $40k more. The retailer says that after switching to credit card payments for the first time last month and having their card successfully charged for $40k, Meta lost the money and has no record that the transaction occurred, even though Tidbyt can provide proof from their bank that they were charged. Meta's customer service has since made it impossible to get help over the matter.

Last year, investors funded 471 e-commerce deals valued at $11.7B, down 30.4% YoY and close to 2018's $10.5B total. The report by Pitchbook noted, “The COVID-19 lockdown offered the perfect storm of low interest rates and a bevy of consumers stuck inside with no option other than to shop online, but these conditions are now entirely behind the e-commerce vertical. Consequently, the sector is unlikely to return to the levels of funding seen in 2020 to 2022 for some time.”

A data breach was discovered on Shopify plugins developed by Saara, which leaked data from over 1,800 Shopify stores and held data from more than 7.6M individual orders, including sensitive customer data. The data stayed up for grabs for eight months and included customer names, e-mail addresses, phone numbers, addresses, order info, IP addresses, and partial payment information.

10. Seed rounds, IPOs, & acquisitions

Uzum, an e-commerce app that offers online shopping, fintech, and food deliveries to customers in Uzbekistan, raised $114M in a Series A round ($52M equity & $62M debt) led by FinSight Ventures, making it the country's first unicorn with a valuation of $1.16B. The startup plans to use the funds to launch new products for unsecured lending to individuals and SMBs, as well as invest in its own iT and logistics infrastructure.

Dema, a Stockholm-based predictive analytics platform for e-commerce that delivers actionable insights for merchants to achieve profitable growth, raised €7M in a round led by J12 Ventures, Daphni, and a group of angel investors. The company will use the funds to accelerate growth of its platform.

Qoala, an Indonesian insurance startup that provides personal insurance products covering accidents, phone screen damage, and ticket cancellations, raised $47M in a Series C round co-led by PayPal Ventures and MassMutual Ventures, bringing its total amount raised to $130M. The company plans to use the funds to explore strategic acquisitions and partnerships, as well as integrate AI across its channels.

Zaver, a Swedish BNPL provider in Europe that can assess the risk on cart sizes up to €200k in real time, raised $10M in a Series A extension, bringing its total Series A to $20M and its total amount raised to $30M. Other BNPL providers like Klarna, PayPal, Santander, and BNP Paribas, rarely fund purchases higher than €3,000 in Europe, but Zaver claims it can allow people to make large purchases, including cars, due to its risk assessment algorithms.

Amazon is investing an additional $2.75B into Anthropic, bringing its total investment in the AI startup to $4B. Under the deal, Anthropic will use AWS as its primary cloud provider an use Amazon's custom chips to build, train, and deploy its AI models.

ChowNow, an online ordering platform and marketing service for restaurants, acquired Cuboh, a Y Combinator-backed POS platform that consolidates all orders from delivery apps into one place, for an undisclosed amount. This deal marks ChowNow's first acquisition, which it hopes will help strengthen its POS integration solution and help its restaurant clients tackle orders across multiple services.

Mobile-First Company, a European startup that's developing a suite of B2B apps designed for phones, raised €3.5M in a pre-seed round led by Lightspeed Venture Partners and Emblem. Their goal is to build a suite of apps for businesses, versus an all-in-one app, such as an app for creating a quote, tracking expenses, or managing inventory.

Alibaba scrapped its plans to go public with its logistics unit, Cainiao, and instead plans purchase all outstanding shares of the company at a $10.3B valuation. Alibaba currently holds a 64% stake in the logistics unit, and the buyout will allow minority shareholders to sell their shares to Alibaba. This is the second time Alibaba nixed a high-profile IPO, having called off the listing of its cloud unit in 2023.

Confetti, a New York-based team-building platform used by Apple, Google, Microsoft, and other big tech companies, raised $16M in a Series A round led by Entrée Capital and IN Venture. The company started out as an events marketplace, but pivoted into an end-to-end service provider that takes care of bringing team building experiences to remote and hybrid workers.

Commercetools, a provider of composable commerce tools for e-commerce companies, is setting the groundwork to go public, according to Modern Retail. A spokesperson said that the company could go public within the next 12-24 months.

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PAUL

Paul E. Drecksler
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PS: My family is concerned about my addiction to dot-to-dot puzzles, but I'm not worried. I know where to draw the line.