Amazon, Shopify Challenger Cart.com Founder Explains Feverish Growth – Business Insider

Amazon, Shopify Challenger Cart.com Founder Explains Feverish Growth – Business Insider

When Omair Tariq was 16, he was kidnapped and held at gunpoint. He thought he would die, but thanks to a malfunctioning gun, he didn’t. It changed him for good.
“After that moment, I lived a very different life,” Tariq told Insider. “I had this level of urgency — that everything has to be now because who the hell knows what tomorrow is going to bring?”
Tariq went on to work in e-commerce. He was the head of finance, strategy, and data science at Blinds.com when it was acquired by Home Depot in 2014. He became the subsidiary’s chief financial officer and the chief operating officer before leaving in 2020 to found Cart.com.
In just 18 months he’s raised $380 million in funding and made seven acquisitions plus a handful of acquihires. He’s building Cart.com like there’s no time to lose, and it’s stunning onlookers and investors.
“When I started Cart, I knew that I wanted to go build a $100 billion company, and I couldn’t wait to get there,” Tariq said.
The early months of the pandemic put into sharp focus how difficult it is for small online sellers to compete.
“E-commerce has been made way too complicated,” Tariq told Insider last year when the company had raised $143 million. “During COVID, we saw so many brands get destroyed because they just didn’t have the financials, the skill set, capabilities, ecosystem — whatever you might need to solve for the digital part of their organization. And that’s not fair.”
Tariq set out to build the software to centralize all those services — online storefront, marketplace sales, social-media strategy, marketing, fulfillment. The unified platform also puts sellers’ data all in one place. And Cart.com owns the services, so it’s not just competing with Shopify or Amazon but with dozens if not hundreds of services across the e-commerce ecosystem.
Initially, investors liked the concept, but some bristled at the speed at which Tariq wanted to build it — not to mention the billions of venture dollars backing startups in every category he would be taking on.
But the pace at which the CEO was able to make key acquisitions was one of the factors that convinced David Sawyer, a chief operating officer and managing partner at Legacy Knight Capital Partners, which led Cart’s February $240 million equity-and-debt round, that the founder could execute on his appetite.
Sawyer caught on to Cart.com’s rise through Abe Minkara, who also works with Mark Cuban to develop consumer-products companies from the TV show “Shark Tank.” The small brands Cuban invested in saw the challenges Cart.com set out to solve.
September 2020
December 2020
Cart.com acquires AmeriCommerce, an e-commerce storefront software firm
Mercury Fund and Arsenal Growth lead $45 million Series A
Cart.com acquires the DuMont Project, a growth-marketing consultancy, and Sauceda Industries, a fulfillment firm
Oak HC/FT leads $98 million Series B
Many founders of Cart’s acquisitions have stayed with the company, moving into roles like head of marketplaces, chief logistics officer, and chief customer officer.
“When you interact with them and the team, it’s almost like you’re dealing with a Fortune 500-level business that’s been around for a decade,” Sawyer said.
Buying companies is easy compared with what happens after the deal closes — integrating people and digital products can often take years.
Cart’s speed has two components. The first is about finding growth-focused businesses where the leadership wants to accelerate, not exit. The second is about ease of integration.
Tariq said he looks for companies using “friendly code stacks” and sometimes starts the integration before the deal closes. Tariq said that in the case of SellerActive, a multichannel-management company, Cart.com closed the acquisition at the end of December and had it fully integrated by Valentine’s Day.
“We’ve literally invented the technology that glues different components of e-commerce enablement together in a way that has never been done before,” Tariq said. The company has roughly 250 developers on staff.
On top of creating a comprehensive e-commerce platform, Cart.com is getting into the physical side of e-commerce.
Warehousing has only recently started to attract as much funding as the digital ecosystem. And it’s proved to be a difficult skill to learn, even for giants like Shopify. Tariq acknowledged that integrating physical fulfillment and Cart’s technology would be the hardest thing the company does. Keeping the leaders of the two fulfillment acquisitions is part of the plan to get it right.
Cart.com acquired Sauceda Industries in July and then FB Flurry in January, adding 3.5 million square feet of warehouse space to the Cart.com arsenal in six months.
Sawyer said Tariq’s quick integration of acquisitions gave him confidence in Cart.com’s move into order fulfillment — owning and operating the warehouses that pack the orders.
“What they’re doing — it’s hard. That’s why no one has done it,” Sawyer said.
“Candidly, I think the market is recognizing that,” he added, alluding to Shopify’s zigzagging moves toward a fulfillment strategy to compete with Amazon’s logistics empire.
More M&A could be coming. Cart.com expects to be profitable by the end of 2022 — its second full year in business — and Sawyer said Tariq would have no problem raising more capital if it were needed.
Though the market conditions may not be as exciting as they were last year, investors and onlookers expect Cart.com to be one of the fastest initial public offerings in e-commerce history.
Tariq didn’t put a timeline on going public, but he did say the company is ready. The books are “squeaky clean,” he said, and the company hired a seasoned chief financial officer in November with the express intention of going public within two years, before the startup’s fifth birthday.
“If the markets are favorable, and everything is going according to plan, then yeah, we will be one of the fastest companies to go public,” Tariq said.
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