Supermarket giant Woolworths has made a multimillion-dollar investment in Melbourne startup Marketplacer as part of its plans to compete with the likes of Amazon through the launch of its own marketplace offering. Woolworths’ venture capital arm, W23, announced the investment yesterday which will see the supermarket take a minority stake in Marketplacer alongside a number of high-profile investors, including tech giant Salesforce and prominent investment firms Endeavour and Acorn Capital.
Marketplacer was founded in 2016 by Jason Wyatt and Sam Salter. The startup helps retailers create their own online marketplaces, similar to those offered by eBay or Amazon, and sell both their own and third-party products. This allows companies to effectively offer a larger range of products without having to stock the items.
Woolworths will leverage its investment into Marketplacer to launch its own online marketplace offering later this year, which will begin with an initial pilot of an expanded range of Big W products.
The supermarket’s head of new business, Faye Ilhan, said the new offering was intended to help the company keep up with shopper expectations, who have become increasingly accustomed to shopping online post-COVID. ‘‘As more of our customers start their shopping journey digitally and buy groceries online, we know their expectations will only continue to rise,’’ she said.
Woolworths’ foray into this space may see the business butt heads with other marketplace heavyweights such as eBay, Amazon or Kogan. However, the marketplace model is becoming increasingly
commonplace among other retailers, with Bunnings, Myer and Metcash all opting for the service.
The retailer’s shareholding in the business is a ‘‘very small minority stake’’, Mr Wyatt said and doesn’t provide Woolworths with any exclusivity over the company’s platform, meaning Marketplacer can continue to work with other existing clients such as SurfStitch, Nokia and Providoor. W23 managing director Ingrid Maes said: ‘‘W23 invests in innovative startups that benefit accelerate our ecosystem strategy, and where long-term win-win partnerships are an inherent advantage for
both parties.’’ ‘‘Marketplacer … will play a key role powering our own digital improvements.’’