Boxed to Go Public Following Merger With Seven Oaks
Boxed, Inc., an e-commerce grocery shopping platform that delivers bulk consumables, is merging with Seven Oaks Acquisition Corp. in a move to become a publicly traded company in the U.S.
The two businesses entered into a business combination agreement designed to propel New York City-based Boxed to the next level in its continuous growth. The combined equity value is estimated at nearly $900 million and the newly structured company is expected to receive $334 million in net cash proceeds. The deal is slated to close by the end of 2021.
With a user experience built for speed, convenience, simplicity and discoverability, Boxed offers curated products, subscription optionality and seamless checkout. The platform is powered by vertically integrated technologies that include AI and robotics and was developed for both business-to-consumer and business-to-business use. According to company information, basket sizes for the B2C consumer base average $100. In 2020, Boxed’s net revenue was just shy of $200 million.
According to Chieh Huang, founder and CEO of Boxed, the agreement will help the company reach a projected 40% year-over-year net revenue growth. “The online grocery shopping market has seen unprecedented growth as of late, and we will see that going forward as consumer shopping habits continue to shift from brick and mortar to online. What really differentiates us is that with our highly desirable homegrown technology stack, we are not we are not just selling the potato chip where we started, we’re also selling the advertising for the potato chip, and finally — licensing out of the software to sell the ad, to sell the chip,” Huang told Progressive Grocer. “Each layer of our technology-enabled process yields an ever higher profit margin, a key metric that differentiates us from all of our competitors."
Huang said that the company will use the capital raised through the transaction to invest more in marketing and expand brand awareness and company acquisitions. “We have plans to expand our product assortment and we will drive recurring revenue through expanding our BoxedUp loyalty and auto-ship programs,” he added.
Gary Matthews, chairman and CEO of Seven Oaks Acquisition will serve as Boxed’s chairman of the board. “Boxed is a leading e-commerce platform with significant competitive advantages and multiple opportunities to accelerate growth and drive value creation. We are confident that by supporting Chieh and the talented management team with our proven operating playbook, Boxed will continue to achieve success in a rapidly growing market,” he remarked.
