Omnichannel key as retail technology funding sees strong momentum

Funding for retail systems tripled to $28.9 billion in the first quarter of 2021 from the same period last year, according to research by CB Insights.

This is its fastest run rate in five years as retailers prepare for a post-pandemic world.

“As shoppers return to stores and reopen their wallets, investment is flowing to omnichannel retail priorities,” CB Insights says.

“Retailers are looking to tech to digitise the store, create more engaging online experiences, and further speed up fulfilment.”

“Sustainability will be top of mind following a year when environmental resilience became even more important. Tech to make operations more efficient across platforms will remain a key focus.”

Funding to retail #tech companies jumped to $28.9B in Q1’21, a 60% increase from the previous quarter.

From #ecommerce to meal & grocery #delivery, we look at global #retail technology investment trends, top deals, and more here. https://t.co/9rBlql59P6
— CB Insights (@CBinsights) May 7, 2021

Mega rounds

Online marketplaces and delivery drove mega funding rounds and key M&A. Q1’21 had 73 mega rounds (deals worth $100 million+), up from j33 in Q4’20.

Funding to online grocery platforms continued to accelerate. Amazon third-party brand builders were M&A targets.

In-store tech funding, meanwhile, doubled from the previous quarter to $2.2 billion, and nearly quadrupled vs. the same period in 2020.

Financing is flowing to supply chain visibility tools, as well as tech to make fulfillment faster and more efficient, like on-demand warehousing and micro-fulfillment.

Investment in supply chain and logistics tech, which hit $8.6 billion in Q1’21, was about flat vs. Q4’20.

And last but not least, dark c-stores – which promise anywhere from 10- to 30-minute delivery windows – garnered more deals in Q1’21 than all of 2020.

Overall, food and beverage delivery tech financing was up nearly 120% in Q1’21 from Q4’20, hitting $8.6 billion.