Rocket Internet – How strong they really are?


Rocket Internet is an internet incubator based in Berlin, only supporting online companies, and they are the biggest player in its market. They are operating since 1999, but only founded the company “Rocket Internet” in 2007, and it just launched at the stock market this week. They have 25 Rocket offices all over the world, covering all emerging markets. They have three main sectors where they work: E-commerce, financial technology and marketplace. Their strategy, next to financial support is to implement other successful companies’ business models into startups. Especially if one model works in one country they try to implement it to other country’s markets. They are receiving a lot of critics for this method, but most of the time, it is working for the     m. They pay great attention to local cultures and traditions; and try to implement as many features to a company as they can to help the users accept it more. Rocket Internet has its own infrastructure, private labels, and warehouses which is a competitive advantage, and gives them opportunity to quick action taking and flexibility in order to help business grow. During their operation they helped out and gained shares in such startups as Wimdu or Foodpanda.

Although they are not always successful, they had some very unfortunate projects in 2013. Some examples for that: a German online home furnishing company, where they lost 64 million euros, or the a Russian online fashion retailer, Lamoda, where the loss was 40,1 million euros. Altogether for 2013, the top 11 ventures created a 442 million Euro net lost. But still, their business is very fruitful; they established 75 companies from all over the world (100 countries!), which earned them 719 million euros revenue.

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This Thursday Rocket Internet launched at the Frankfurt Stock Exchange. They hoped to raise 6.5 billion euros, but unfortunately their IPO wasn’t so successful. On the next they their price fell 13% in its debut. It is really hard to predict what is going to happen to them, since they are very unique. They offer a lot more than a simple venture capital firm and they usually have bigger stake in start-ups. If they are successful in the stock market they could turn the focus on to digital Germany.

The founders, the Samwers brothers (Oliver, Mark, Alexander) are really committed to the company, and to be successful. Oliver Samwers called himself the “the most aggressive guy on the internet”.

Do you think a relatively small company could have such a big influence in the German Stock Market? How do you see Rocket Internet’s stock in the future?

Resources

http://www.crunchbase.com/organization/rocket-internet

http://www.forbes.com/sites/ryanmac/2014/10/01/rocket-internet-prices-shares-at-top-of-range-for-largest-german-tech-ipo-in-14-years/

http://www.forbes.com/sites/ryanmac/2014/09/10/german-startup-incubator-rocket-internet-launches-ipo/

http://online.wsj.com/articles/rocket-internet-shares-fall-below-issue-price-at-debut-1412237549

http://www.economist.com/news/business/21621820-predicting-rocket-internets-trajectory-hard-want-predecessors-launching

https://www.rocket-internet.com/about

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