E-commerce, by its very nature, is an online business, but you can’t always get away from the expense of bricks and mortar entirely. And so it is with the Samwer brothers‘ Zalando, which originally launched as a Zappos clone but has since expanded from shoes into general fashion. It has announced that it’s secured long-term debt financing of €40.7 million (approx. $52.6m), from Commerzbank, Sparkasse Mittelthüringen and KfW Bankengruppe. The new capital will be used to fund parts of the “interior fittings” of its new logistics centre as the company continues to gun for scale.
Of note, it follows another (undisclosed) round of funding, as recent as this August, that saw J.P. Morgan Asset Management and Quadrant Capital Advisors added to Zalando’s list of backers with each owning around 1 percent of the company.
Other investors in Zalando include the Samwer brothers’ Rocket Internet (owning 44 percent), Holtzbrinck Ventures (13 percent), Tengelmann Ventures (8 percent), Investment AB Kinnevik (16 percent) and DST Global (9 percent).
According to today’s press release, the construction site for the company’s 78,000 square meter warehouse in Erfurt opened in December 2011, while the extension to the building is expected to be completed in summer 2013.
Furthermore, the financing package ensures a “revolving credit facility” to support the company’s business operations.
Following a well-trodden path, launched in 2008, Zalando has since expanded from shoes to more general fashion. Starting in its native market of Germany, the e-commerce site is now live in 14 markets, having added Poland and Norway last month. To service those multi-European markets, it needs a logistics base that scales — and today’s new debt financing should provide the capital needed to achieve that.