E-commerce brand incubator and aggregator Benitago Group (Benitago) is now positioned to scale to even greater heights, having just closed a $325 million Series A round led by CoVenture, an asset management firm with participation by HSBC UK. The company’s sizeable and timely raise adds to its momentum, having launched more than 10 brands and 300 products in-house within five years of its founding.
Founded in 2016 by Benedict Dohmen and Santiago Nestares, the startup found success by creating and acquiring brands on e-retailer marketplaces such as Amazon. The co-founders honed a strategy that identifies product categories projected to see heightened demand on various platforms or in niches ripe for disruption.
The co-founders who met as undergrads at Dartmouth attribute their success to leveraging search trends and sentiment data.
“We were both always in the library hunched over and coding into the wee hours of the night. Over time we developed a rapport and started joking about making a pillow that would make us both feel more comfortable. Eventually, we ran a sentiment analysis on reviews of pillows on Amazon, and decided to take a leap and actually make a pillow based off it,” Dohmen explains.
That early partnering led them to launch the e-commerce brand incubator. They set course to either build product offerings in-house or to make a strategic acquisition of an existing brand—all now yielding results that attracted investor support.
The company’s recent third-quarter results reflect the success of these two approaches. Their organic brands grew 23%, and their acquired ten brands had an average post-acquisition growth rate of 31% during the first three months of operation. This high-level performance enables Benitago to complete their acquired brands’ earn-outs plus more.
With over $380 million raised to date, Nestares sees the Series A round as a critical component of their model’s growth.
“This capital raise fuels our ability to continue to build compelling brands, and products in-house as well as acquire great third party brands and operate them efficiently. In the past months, we’ve seen tremendous growth for our in-house and acquired brands’” says Nestares. “Post-Covid normalization, supply chain challenges and increased international competition have all underscored the value of hands-on experience in scaling Amazon brands.”
The company is now on the lookout for self-starting Amazon business owners who are either ready to sell or need resources to grow their businesses. Benitago provides a wealth of timely resources for many startups and early-stage companies that accelerate their models to achieve early success.
CoVenture is a strong match for Benitago, as they focus on investments across the capital stack of tech-enabled companies. They are often the first institutional equity and/or debt financer to support business operations.
“What makes Benitago one of the best operators in the space is that they understand that acquiring brands is not the entire strategy as you have to run the brands effectively post-integration,” said Ali Hamed from CoVenture. “We saw Santiago and Ben’s experience launching and scaling Amazon-native brands and their unique focus on in-house brand incubation and product development, and knew this was a team we wanted to get behind.”
The two co-founders through their e-commerce brand incubator have accomplished so much in just over five years. They achieved the buy-in of investors by presenting a compelling investment opportunity—which has given them the funds to propel the company to even greater heights of growth.
