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Thrasio bought Amazon FBA brands and centralized operations to cut costs, but iOS tracking changes, higher Amazon fees, and rising interest rates in 2022 destroyed the arbitrage that made the model work.
Thrasio bought Amazon FBA brands and centralized operations to cut costs, but iOS tracking changes, higher Amazon fees, and rising interest rates in 2022 destroyed the arbitrage that made the model work.
$3.4 billion aggregator Thrasio has gone bankrupt. They started buying Amazon businesses that were doing well, and their whole thing was like, look, we can have efficiencies with like a front office or shared resources, which means you're sharing like HR, finance, or whatever. And basically you're arbitraging. And this was before all the iOS changes, before the tracking changes and all that, right? Also, at the same time, I believe Amazon's take was like 15% or whatever. Once 2022 hit, when interest rates started going up, the arbitrage no longer worked because Amazon's take rate went higher. And then also the calculus on running the ads, the ad arbitrage, it was no longer working. So everything went reverse. Like even though they had these interesting e-com businesses that they all rolled together, it didn't work anymore because of the high interest rates. Everything started going down.
