Zalando, AB Kinnevik, Emesco AB, Holtzbrinck Ventures, Tengelmann E-Commerce Beteiligungs-GmbH, Finanzierungsrunde, Schuhversender

It feels like the tenth round of funding at German e-commerce giant Zalando, the online shoeshop that has never struggled to attract investors. In the latest funding round, the Swedish investment group Kinnevik has joined the extensive list of Zalando shareholders with an acquisition of 2.7 percent of the company. Investment AB Kinnevik sealed the deal via its Stockholm subsidiary Emesco AB, which it acquired back in September 2009.

Holtzbrinck and Tengelmann up their stakes

Kinnevik was not the only major investment group involved in this funding round, with existing shareholders Holtzbrinck Ventures and Tengelmann E-commerce also increasing the number of their absolute shares, giving Zalando a fresh injection of capital while ensuring their relative shares were not watered down. The majority shareholder Rocket Internet, however, reduced its shareholding slightly. An inside source told Gründerszene that Zalando’s valuation in the transaction had reached „an entirely new level“.

Rocket Internet now holds 59 per cent of the company (previously 61 percent) and Holtzbrinck Ventures retains 17 percent, with Investment AB Kinnevik now on board with a much smaller share, probably due to the amount of the valuation and having arrived at the table late. Tengelmann was not part of the original consortium. It joined as a shareholder last December acquiring 10 percent of Zalando, which it retains after the latest round of financing.

Business as usual at Zalando

Zalando is currently one of three main projects being nourished by the Samwer brothers‘ incubator Rocket Internet, the others being eDarling (dating) and deal-of-the-day site Groupon City Deal. Turnover at Zalando is huge and growing. Almost all serious e-commerce ambitions of the Samwer brothers rest on the shoulders of Zalando, which has successfully branched out to include designer brands (Zalando Lounge), kids‘ clothing (Zalando Kids) and sportswear (Zalando Sports).

At the same time, the high capital requirements of the company continue to rise. Extensive stock levels must be pre-financed seasonally and margins are slim enough that the company lacks some of the liquidity required to fully pre-fund itself while managing daily operational costs. So with the recent round of funding Zalando has taken another important step forward and should now be working towards further consolidation. It will not be long then before the speculation begins as to who is most likely to go for a full takeover of Zalando when the time comes for an exit … Tengelmann? Zappos? Amazon? Take your pick.