The $20 million raise underscores investors’ confidence in the future of the e-commerce book industry which continues to grow strongly.
Booktopia posted revenues of $131m in FY19 and is currently on track to deliver revenues of $175 million in the 2020 calendar year.
The company’s market share by revenue is on track to edge ahead of the number one book retailer in Australia, Big W.
The equity was raised from a consortium of private investors led by Su-Ming Wong, Co-Founder & CEO of Champ Ventures (who will join the Board of Booktopia) and John Sampson, Founder & CEO of JBS Investments.
The founding shareholders retain majority control and Booktopia will continue to be an independent Australian-owned business.
The capital raise, completed with the assistance of AFSG Capital, also included a portion of long-term debt.
Mark Paton, Managing Director of AFSG Capital said Booktopia’s track record of rapid, profitable growth made for a compelling investment opportunity.
“The capital raised will go exclusively toward funding growth over the next few years and establishes a solid foundation for future capital market engagement,” he said.
The funds will be used in three key areas.
– Further investment in automation to scale its inbound and outbound capacity from 30,000 individual books per day to 60,000 per day;
– Holding more titles at its 13,000 sqm Sydney Distribution Centre, growing its in-stock range as well as holding more units of the popular titles so they are ready-to-ship; and
– Working capital.
Tony Nash, Booktopia’s CEO said: “Booktopia has come so far and the team is rightly proud to have built this 100% Australian owned business to scale from within our own internal resources. We are thrilled to have this round of funding in place. The Funding will allow us to accelerate our growth in a controlled and measured way by investing in our ability to deliver to Australian book consumers through expanded distribution infrastructure and stock. This has been a proven high growth and predictable model for us for 16 years and we are not about to change. We know that’s what our customers want from us.”
“It was very important we brought investors on board who can add value to the next phase of our journey. We are delighted to have such an experienced group who understand e-Commerce, retail and capital markets.”
Mr Nash said the recent acquisition of the University Co-operative Bookshops was fortuitous and was entirely separate from the current capital raising.
“We were already very well advanced with our private investors before The Co-op went into administration and as Tertiary Academic Sales were already a significant portion of our revenue it was deemed that if the numbers worked then we would purchase it from within our own financial capacity,” he said.