UPDATED: MAY 12, 2016
On Tuesday, we reported on rumors concerning a merger between Wallapop and Letgo, the Barcelona-based marketplaces. The merger is now a fact, and as the rumors said, its only for the US market.
The two second-hand marketplaces will now go under Letgo’s name. In addition to the merger, €100 million in funding will be injected by existing shareholders, according to the companies.
The merged company will be majority owned and managed by Letgo.
Letgo’s co-founder Alec Oxenford said this on the merger:
“We are excited to be working with Wallapop’s insightful leadership team, who saw these trends taking shape and entered the sector early. This partnership is a significant milestone for letgo and the industry as a whole, and is a substantial advantage as we continue to scale nationally.”
Agustin Gomez, Wallapop co-founder and CEO believes the merger will take their business to another level:
“We see this merger as a game changer in the U.S. mobile classifieds competitive landscape.”
Both companies are based in Barcelona, but have the US as their target market, and aims to challenge players like Ebay, Offerup and Craigslist.
As for other markets the two companies will continue separately.
Wallapop has recently launched a new feature which makes it possible for users to pay for better visibility for their ads, and represents their first attempt at monetizing their business.
Both companies has raised massive amounts of funding for Spanish standards.
Wallapop which is a company of the venture builder Antai has raised $150 million from different investors. Letgo has closed a round of $100 million from South African media company and tech investor Naspers Limited.
The competition has been stiff between the companies in the US, and to be able to challenge the biggest competitor Offerup, and also in the future Facebook’s local market, as the social network already is huge for selling used goods on the platform.
In Barcelona, Wallapop has way more goods for sale than Letgo, however in the US, Letgo has been known for beating Wallapop. This may be the reason why they’ve decided to have Letgo running things after the merger.
Martin Scheepbouwer, CEO of Naspers Classifieds which is the main investor in Letgo said this Thursday:
“With this partnership in place, no one is better positioned than letgo to capitalize on the immense opportunity for growth in U.S. classifieds.”