Spryker Systems GmbH, a six-year-old provider of ecommerce technology, has raised more than $130 million in venture capital to build out its technology for developing B2B ecommerce sites and online marketplaces and grow its market in the United States, the company said yesterday.
The Berlin company, whose technology is used by more than 150 companies involved in B2B and retail ecommerce, says it also plans to develop a third-party technology “AppStore.” The funding—in a financing round from investment firms TCV, One Peak, Project A and Silicon Valley Bank—brings Spryker’s value to $500 million, the company says.
Spryker Systems, co-founded in 2014 by co-CEOs Boris Lokschin and Alexander Graf, provides a “headless” ecommerce technology infrastructure based on extensive use of application programming interfaces, or APIs, to connect the ecommerce engine with a customized set of customer-facing front-end interfaces. A headless commerce platform is designed to help companies conduct ecommerce transactions with customers across multiple online venues—including websites, mobile apps and internet search ads—without having to modify the software code in the back-end ecommerce engine. This kind of set-up is often called a “composable” cloud-based technology environment using modular ecommerce applications.
Lokschin says Spryker is out to help manufacturers, distributors and other businesses transform to become “composable” enterprises with “cloud-native modular commerce technologies to power their sophisticated B2B, enterprise marketplace or unified commerce initiative.”
Although Spryker has been focused mostly on the European market, it expects the new funding to help it grow its international market presence and, in particular, expand in the U.S., the company says. It notes that the U.S. now accounts for 10% of its annual software revenue, which the company didn’t break out.
“Spryker is largely a European-centric brand. But this latest round of investment will make it possible for them to expand name identification in North America and carve out a position in what has become a hypercompetitive North America ecommerce suites market,” says Andy Hoar, CEO of digital commerce consulting firm Paradigm B2B.
Jordan Jewell, research manager for digital commerce at IDC, says Spryker emerged as a significant provider of online marketplace technology soon after introducing its marketplace platform earlier this year. He attributes that development curve to Spryker’s broad use of APIs and microservices, which it uses to extend the B2B functionality of its ecommerce technology platform to its new marketplace offering. “They have adapted to where their customers are, and more customers are building marketplaces.”
Joe Cicman, a senior analyst for digital commerce at Forrester, says Spryker is benefitting from a resurgence of interest by investment firms in ecommerce technology designed to help companies sell through their own online marketplaces in addition to their dedicated ecommerce sites.
“In 2019, funding for marketplace development platforms and tools was shy of the $1 billion mark, topping out at $933 million,” Cicman says. “Through the first three quarters of 2020, venture capital funding has sharply accelerated to surpass $1.4 billion.”
Spryker employs more than 250 employees and, in addition to Berlin, has offices in New York, the United Kingdom, Netherlands and Ukraine. It “has been growing its recurring revenue more than 100% annually,” the company says.
Spryker’s client base includes Hilti, a manufacturer of construction equipment; Toyota Motor Corp., which has developed an ecommerce system for its dealer network; apparel brand The Tom Taylor Group, and food products wholesaler Metronom.
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