Wal-Mart to launch investment arm in e-commerce push

Wal-Mart Stores Inc, the world's largest retailer, will launch its first investment arm to expand its e-commerce business in partnership with retail start-ups, venture capitalists and entrepreneurs, the company has disclosed.

The plan is being spearheaded by Marc Lore, Wal-Mart's e-commerce chief, who joined the Bentonville, Arkansas-based company from retail upstart Jet.com, which it acquired for more than $3 billion in August. Since then, Wal-Mart has acquired three small web retailers to add urban and millennial shoppers.

The venture, called Store No. 8, will work with startups that specialize in areas that include robotics, virtual and augmented reality, machine learning and artificial intelligence, Lore said at Shoptalk, a retail conference in New York. It will be based in California's Silicon Valley, he added.

Wal-Mart will keep the startups separate from the broader organization so that they will not affect the retailer's bottom line in the near term, Seth Beal, senior vice-president, incubation and strategic partnerships, said in an interview. He didn’t give a timeframe for the launch.

“We’re being pretty active, yeah, we’re behind,” he added. “We need to catch up,” he told journalists at the Code Commerce conference in Las Vegas.

That’s remarkable given the string of companies he’s already snapped up. Lore was put in charge of Walmart’s online business after Walmart bought his company, Jet.com. He proceeded to acquire Moosejaw, an outdoor retailer; Shoebuy, a competitor to Zappos; and most recently online fashion retailer ModCloth. He had already acquired furniture site Hayneedle under Jet.com.

All told, he has spent more than $200 million buying e-commerce startups. “We’re seeing what these acquisitions have done for the business,” he said. “It’s definitely a nice surge, so we will continue to do it.”

Separately, Lore announced a new product as part of Walmart: An app that allows customers to see an easy list of products it buys regularly.

“If you now go into a Walmart store and buy diapers, dog food, shaving cream ... you’ll see all those purchases” on a list that can be used when the customer makes future purchases. “The average person will buy 100 different consumable products,” Lore explained. “Go online and try to find those precise 100 things that you’re looking for and build a list — it takes a really long time.”

Walmart will organize that list after you’ve bought them, he went on. “When you get home, it’s neatly organized right on the homepage — easy reorder.”