Eurazeo has joined a €41m funding round for Back Market, a France-based online marketplace for refurbished electronics.
Groupe Arnault, Aglaé Ventures and Daphni have also participated in the round. The company first raised external capital in May 2017, collecting €7m.
Bark Market claims to be the only global online marketplace for refurbished electronic devices. Its platform gives consumers access to smartphones, laptops and TVs that are typically 30 per cent to 70 per cent cheaper than new products. The market is estimated to be worth more than €50bn.
Back Market employs around 100 people across offices in Paris, Bordeaux and New York, where it launched earlier this year.
“It was a name that popped up in our pipeline when they raised last year but it was a bit too small for us at that time,” Yann du Rusquec, managing director at Eurazeo Growth, told Real Deals. “It has all the ingredients to be a truly global leader in its space.”
Eurazeo sees parallels between Back Market and another portfolio company, fashion marketplace Farfetch.
“We are familiar with the model because it is similar to Farfetch. We started looking at the opportunity a few months ago and to be honest it looked even more impressive than Farfetch,” du Rusquec said.
For Back Market, the funding comes as the company seeks to increase its geographic presence.
“We raised €7m last year to confirm our leadership in France and consolidate it in Europe. Within a year we gained traction in those countries and we felt we could expand to the US, which we did in February. The main purpose of this funding round is get the capital to support our global ambitions. We are trying to make it as simple and trustworthy as possible for consumers to access refurbishers and we want to do it on a global scale,” said Vianney Vaute, co-founder and CMO of Back Market.
The company believes that as well as offering a unique value proposition to consumers, its model also provides environmental benefits. “It is an idea that makes sense because we truly believe there needs to be an alternative to buying new devices. If you look at the amount of natural resources needed to produce all of these TV and phone screens, it is an issue. We believe refurbishment can be this much needed alternative. Eurazeo believed not just in the business model but in the idea as well,” said Vaute.
Eurazeo, which has teams in New York and Shanghai, will now support Back Market as it seeks to grow its presence in the US and tap the Asian market.
“Helping them expand internationally is where we can add value. We also want to help them diversify their products and build relationships with the brands, which we did with Farfetch and which will be key for them,” said du Rusquec.