Operating for the past seven years as a privately held online "wholesale retailer," Boxed, frequently described as a Costco Wholesale (NASDAQ:COST) competitor favored by millennials, may be planning to sell itself or go public, according to sources quoted by Reuters. The company, which sells discounted, bulk household items, personal care, groceries, and other product categories without requiring a paid membership, is said to be currently worth somewhere in the ballpark of $1 billion.
Online bulk retailers such as Costco have raked in juicy profits since the start of COVID-19, with Costco posting gains of 8.8% in net sales for July and expected to report positive net sales for August tomorrow. Boxed has similarly profited from people's aversion to shopping in person during the pandemic, with its free memberships rising sharply since the start of March, according to the same sources.
The company attracted some former Amazon (NASDAQ:AMZN) talent last year when it hired Prentis Wilson as president, a post he still occupies. Wilson, an 8-year veteran of Amazon, oversaw the expansion of Amazon Business to the $10 billion sales level. He told CNBC the "business that Boxed has built has a really long runway" and remarked the retailer has "certainly carved out a specific focus that's hard to replicate." He added his belief the "rocket ship" success of Amazon Business can be repeated in Boxed.
Reuters said its unnamed sources indicated Boxed is examining the possibility of a merger with a special purpose acquisition company (SPAC), which could lead to a public stock offering as one of several potential outcomes. It has also engaged the services of Citigroup to provide guidance as it moves forward on the possible deal.