Rubber Monkey Investment offer preview

Rubber Monkey is one of New Zealand's premier e-commerce retailers of creative technology products.

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Overview

Rubber Monkey’s mission is to provide the largest range of creative technologies online to make it easier for Kiwis to source affordable gear and technology.

The Rubber Monkey webstore has a growing list of 95,000 video, computer, audio and photography products sourced from local distributors as well as from manufacturers around the world.  The webstore is built entirely on proprietary technology which manages everything from product ordering, warehousing and inventory management to sales and order shipping. Over 300,000 successful orders shipped to date.

Over the past 11 years, the company has brought a world-class experience to local customers and created a wonderful team of employees with over 30 years of successful combined e-commerce, distribution and retail experience.  More recently it has successfully established a presence in Australia, generating $2.5m of revenue in FY22.

Rubber Monkey has experienced significant growth over the past few years, growing revenue from $6m in FY17 to $20.4m in FY22 with an EBITDA of $1m.  Over the last two years of the pandemic, Rubber Monkey has grown total revenue by 80%.

Rubber Monkey is now seeking to raise $2 million of capital to support its growth strategy which is focused on increasing its Australian market presence, as well as continuing to achieve steady NZ revenue growth with a wider product offering to a broader customer base.

Investment Highlights

  • Forecasting to grow revenue from $20.4 million in FY22 to $95 million in FY27.
  • Established Australian presence with $2.5 million of revenue in FY22.
  • Operating in a fast growing online retail technology market forecast to be worth over $6.4 trillion by 2024.
  • 95,000+ products listed on the platform from 399 global suppliers.
  • Deloitte Fast 50 index nominee in 2015.
  • Opened 10,000 sq ft purpose built warehouse facility in 2019.
  • Experienced team with over 30 years combined experience in e-commerce and technology at a range of business including Trade Me, Mighty Ape and StarNow.

The Market

In 2019, only 13.6% of sales were made from online purchases but that number exceeded 19.5% in 2021. This translates to forecast global retail e-commerce sales of $4.9 trillion in the same year, forecast to grow to $6.4 trillion in 2024.

In New Zealand alone, consumers spent $8.77 billion on homeware, appliances and electronics, 10% of which came from online sales. Over 440,000 shopped online in this category for the first time in 2020 and Kiwis spent nearly 49% more online in this category compared to 2019.

Market growth can be attributed to an ever growing technology market with new product categories entering every year, adding scale to potential market audiences. Examples of new product categories include drones, mirrorless cameras, streaming video, and podcasting. This is on the rise as more people are now seeing the opportunity to become independent content creators, requiring tools and technology to achieve their goals.

Rubber Monkey is in the exciting position of being ready to capitalise on the rise of e-commerce sales. Within the mass market retailer channel there are other buying options for consumers, however, Rubber Monkey’s culture, focus on superior customer service, along with an easy to use bespoke website make them stand out from the competition.

The Opportunity

Being a small nation on the other side of the world presents businesses with many challenges to overcome when supplying technology from around the world. New Zealand sits outside the supply chain of large wholesale and retail traffic, requiring a bespoke solution to sourcing and achieving economies of scale. Modern customers are savvy to buying online and have world market prices at their fingertips - they know what price they should expect to pay and do not want to compromise. Customers are not willing to accept the usual rhetoric from local retailers about small population, high freight costs and local warranty. They often have better pricing at a click of a button.

Rubber Monkey leverages knowledge of overseas supply chains, low setup and maintenance cost of an e-commerce business, and its own proprietary supply chain to reduce the overall costs of getting sought after technology to the New Zealand market.

Rubber Monkey has validated its model in New Zealand, established a presence in Australia and is now focusing on growth. Its strategy centres on growing its presence in the Australian market and continuing to increase its product offering. Capital from the current round will be used to set up a sales office and warehouse on the ground in Australia, to research and develop new products, and to set up supply chains and logistics.

Having this facility in Australia will benefit Rubber Monkey’s New Zealand customers by allowing a larger, more comprehensive product range and the benefits of economies of scale. Laurence, Rubber Monkey’s CEO, plans to be on the ground in Australia to oversee growth in Australia.

Rubber Monkey plans to reinvest profits over the short term in order to accelerate its growth, after which it will look to distribute dividends to its shareholders.  Over the medium term Rubber Monkey would expect to provide additional shareholder returns through an exit via strategic buyout or Initial Public Offering (IPO).

Next Steps

Rubber Monkey is seeking to raise $2 million of growth capital. If you wish to receive more information about the capital raise, please leave your details and an indicative investment amount below. We will be in touch with all interested investors shortly.


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About Snowball Effect

Snowball Effect is a New Zealand-based online investing marketplace, that enables New Zealand companies to offer shares to members of the public. Snowball Effect was founded in 2012 and launched in August 2014, after being one of the first to acquire an equity crowdfunding license from the New Zealand Financial Markets Authority (FMA). Over NZ$140 million has been raised on the platform.