Global VC investments in online marketplaces nearly triple to historical high of USD28bn in Q1 2021

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Online marketplaces are continuing to benefit from shifts born out of the pandemic and show no signs of slowing down. 

According to the research data analysed and published by Definanzas.com, global VC investments into marketplaces hit a new all-time high in Q1 2021. It rose almost threefold from USD9.9 billion in Q1 2020 to USD28 billion in Q1 2021. It is also USD4 billion higher than the previous record. 

Based on a Be STF projection, global marketplace sales are set to grow at a 20 per cent CAGR between 2020 and 2025. In that period, the figure will rise from USD3.5 trillion to USD8.8 trillion. Their share of online sales will also grow, going from 19 per cent to 24 per cent. 

Besides the massive increase in VC funding into marketplaces, unicorn valuations in the space have also surged remarkably. From USD2.2 trillion in January 2019, the figure soared by 70 per cent to USD5 trillion in Q1 2021. 

Some 81 new unicorns joined the ranks in 2020, bringing the total number to 370. Among them, the top 30 marketplace unicorns account for 79 per cent of total valuation or USD3.9 trillion. That marked a USD1.6 trillion increase in valuation. 

According to eMarketer, eCommerce accounted for a 7.4 per cent share of total retail sales globally in 2015. The figure rose to 13.6 per cent in 2019, posting a huge increase to 18 per cent by 2020. It is set to rise further to 19.5 per cent in 2021 and 21.8 per cent by 2024. 

B2C sales accounted for 53 per cent of total B2C online sales in 2020 or USD2.45 trillion. It will grow at a 14 per cent CAGR between 2020 and 2025 to USD4.723 trillion, accounting for a 61 per cent share of the total. On the other hand, B2B sales, which had a 7 per cent share and a USD1 trillion valuation in 2020, will grow at a 32 per cent CAGR in the same period. The remarkable growth will drive its total valuation to USD4 trillion and the segment’s share to 14 per cent.