Digital & IT

Lift-off! OnBuy is set for meteoric growth after raising further £35m from VC & tech investors

Cas Paton, Founder and CEO, OnBuy: “We’re here to make noise, challenge the status quo and change the digital marketplace landscape forever.”

By Staff Reporter [email protected]

Published: July 13, 2021 | Updated: 14th July 2021

OnBuy is on course for meteoric growth after raising an impressive £35m in a new funding round.

The figure – announced on July 13 by the Poole-based online marketplace – is more than four times the total investment in the company to date.

It will fuel a major expansion of activities with the company’s sights set firmly on reaching unicorn status in the coming years.

The term unicorn, in a business sense, was coined by venture capitalist Aileen Lee for a privately held Silicon Valley startup company valued at over $1bn.

Founded in 2016, OnBuy has grown to £155m annualised GMV (gross merchandise value) with only £8m in total investment until now.

The new investment of £35m from venture capitalists and strategic technology investors will be a mix of debt and equity.

Significant input has come from players including:

  • Bring Ventures – Norway Post’s venture arm
  • Fuel Ventures
  • Guy Hands, Founder and Chairman of Terra Firma Capital Partners
  • Knut Frängsmyr, Deputy CEO of Klarna
  • Richard Goulding, Founder of Play.com

Other strategic investors are also involved.

In addition to external investment, a fully funded £2m allocation was set aside for existing retailers currently using the platform.

OnBuy has attracted more than 7,000 retailers, hosting over 36m products.

The company, which employs more than 85 people, vows never to compete with its retailers.

Instead it says it offers a fairer marketplace to host well-known brands, both big and small, with high-quality products at competitive prices.

The new funding will enable OnBuy to further develop its product offering for both sellers and consumers as well as pursue global expansion.

Plans for the next 12-24 months include the development of a consumer app, improvements to the product infrastructure, the launch of new partnerships as well as further news of worldwide expansion.

Cas Paton, Founder and CEO of OnBuy, said: “The global eCommerce market is expected to total $4.2 trillion by the end of 2021, a figure that is set to grow even more over the next few years.

“However, it’s alarming to see that the industry is still following the same detrimental and unfair marketplace model that has existed for years.

“I created OnBuy to provide something unique: a clear, level playing field.

“In our four years of rapid growth, it’s clear to see that this is a model that works to everyone’s advantage.

“This investment will allow us to unlock even more potential and take OnBuy to the next level with an even better, easier to use product than ever before.

“We’ve made it this far with the help of our early angels, amazing team, trusted retailers and of course all of our amazing customers, but we’re not nearly done yet.

“We’re here to make noise, challenge the status quo and change the digital marketplace landscape forever.”

Thomas Tscherning, Bring Ventures, Executive Vice President, Norway Post, pictured left, said: “OnBuy has experienced tremendous growth and we believe the company has a very promising future ahead.

“We look forward to being a part of OnBuy’s continued growth through this venture investment that we believe will strengthen our portfolio of e-commerce activities.”

Knut Frängsmyr, Deputy CEO of Klarna, added: “Having watched OnBuy for some time, I’ve continuously been impressed and inspired by how they put their customers first – buyers and sellers.

“In an ever-changing landscape, sometimes simplicity and fairness will prevail.

“The growth opportunities ahead for OnBuy and the team are tremendous, and I am thrilled to be invited to join this journey.”

Prior to the latest investment round, OnBuy raised £5m in funding led by Fuel Ventures following an exceptional period of growth through the first half of 2020.

It allowed OnBuy to expand its leadership team and also enter a new phase of development and further growth.

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