Lincoln e-commerce company Spreetail on Tuesday announced one of the largest venture capital raises in Nebraska history.
The Lincoln-based company said it raised $208 million from a group of investors that includes Omaha's McCarthy Capital.
Spreetail, which started out selling refurbished computers online before growing into one of the largest e-commerce accelerators in the world, said it will use the capital to enhance its technology and grow its brand partnerships.
“We have read the writing on the wall around post-pandemic shifts in consumer behavior combined with inflationary concerns and have repositioned Spreetail to increase our investment into our brand partnerships, our technology, and our organization this year," Brett Thome, global CEO, said in a news release. "We understand the future of Spreetail needs to be focused on mutual growth with our brand partners while investing in our tech stack. Every penny is being injected back into the business to do this, which will add stability to the future growth of Spreetail for years to come.â€
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Spreetail's business boomed during the coronavirus pandemic, as people stuck at home and flush with federal aid money spent record amounts online. Its sales spiked 90% in 2020.
U.S. e-commerce sales grew 50% in 2021, hitting $870 billion, and Spreetail took advantage, posting $1 billion in revenue for the first time in the company's history.
However, growth slowed last year, and even though U.S. e-commerce sales topped $1 trillion for the first time, Spreetail announced in October that it was laying off employees as part of an effort to "continue to evolve, in a post-pandemic world, so we are best positioned for 2023 and beyond," Thome said in a blog post at the time.
Though the company didn't disclose the size of the layoffs, a filing with the Nebraska Department of Labor listed 220 people losing their jobs, mostly in Lincoln and Omaha.
Spreetail's focus now is on providing end-to-end e-commerce services to product manufacturers, including buying and warehousing products, marketing and listing the products on websites and providing shipping and customer service.
“Spreetail is focused on helping brands from around the world successfully merchandise their products on retail platforms like Amazon, eBay, Walmart, Target and many others," Thome said in an email.
This is the second investment in the company by McCarthy, which also put in an undisclosed sum in 2019. Thome said the company remains a minority owner.
The $208 million investment ranks as the second-largest ever for a Lincoln-based company, trailing only the $300 million Monolith raised last year. It's also the fourth year in a row a Lincoln company has secured a nine-figure investment, something that had never happened before 2020.
Dan Hoffman, CEO of Invest Nebraska, said the recent large capital raises are, "indicative of a 10-year ecosystem that continues to grow."
Many local startups that were formed in the past 10-15 years have matured and are in need of large amounts of capital to continue growing, Hoffman said, noting that he expects to see "large raises on this scale into the future."
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