Comment: Ecom Investor Balderton Refreshes Team Amid Rumours of New Investment Push

Balderton Capital, the private equity investor whose list of past and present investments reads like a Who's Who of UK ecommerce firms, has brought in new talent as it seeks to focus more heavily on early stage start-ups.

The investment firm has appointed blinkx founder Suranga Chandratillake as its newest general partner. His appointment comes amid talk that co-founding partner Barry Maloney plans to step down.

It also drafted in Wellington Partners' Daniel Waterhouse in October. Waterhouse spent five years at the firm, often providing the first institutional money in a number of fast-growing companies including Hailo, YPlan, SumAll, EyeEm and Qype, later sold to Yelp.

Techcrunch reckons that the management makeover is part of a refocus of Balderton's investments even more heavily on Series A funding rounds.

The slight shift in strategy can only mean that Balderton, whose UK investments have included Asos, The Hut and Worldstores, is sharpening its claws amid increasing interest in tech, internet and ecommerce start-ups from a wider range and larger firms.

Balderton and a handful of other tech investors had a lot of room to maneuver in the early years of the last decade when it broke away from US venture capital firm Benchmark Capital.

The only way to go it seems is down into the underground - seek out the new talent and, as Balderton said in a press release this week, 'identify and back the next generation of entrepreneurs'.

With one a former entrepreneur himself and the other a proven identifier of successful firms, Balderton clearly hopes Chandratillake and Waterhouse will be able to help it do just that.

For more on The Hut, see our Online Retail Stars of 2013 Report: The Hut.

Asos Reports ‘Strong’ Sales As It Gears Up For Global Expansion

Online fashion phenomenon Asos has reported 'another strong Christmas' in the UK and Europe as it gears up to take on the world's biggest markets.

The Camden, London-based etailer said total sales in the four months to the end of December increased 38 per cent, boosted by UK sales of 37 per cent and European sales of 69 per cent.

CEO Nick Robertson said: 'These results were driven by significant improvements to our customer proposition, including better delivery options, additional payment methods and the roll-out of our premier service in key international markets.'

He added: 'We have enjoyed another strong Christmas and made a good start to the financial year.'

The company is planning to 'significantly increase' the capacity of the Barnsley distribution centre this year and open a central European distribution centre.

US sales, about a quarter the size of UK sales, rose 28 per cent and 'rest of the world' sales increased 19 per cent. Retail gross margins increased 90 basis points.

One analyst said, despite expectations that UK sales would inevitably slow at some point, Asos would benefit overseas by targeting key markets.

'We believe [Asos] will focus on a limited number of markets with a view to making them as significant as the UK rather than taking a scatter gun approach to global expansion with the development of a small dedicated infrastructure in each market,' the analyst said.

Asos To Announce Sales Up By A Third Next Week

Online fashion phenomenon Asos is expected to announce a surge in sales in the coming days driven by an increasingly localised offer in key markets.

Analysts expect the company to say on Tuesday that sales increased 38 per cent in the four months to the end of December and that UK sales increases 35 per cent.

But the main driver for growth was in Europe where sales increased 70 per cent as the company increasingly tailored its offer for individual markets such as France and Germany.

Asos, which one analyst said focuses on 'providing an entire fashion web-sphere for twenty-somethings,' is expected to increase group sales to over £1 billion this year. It has also launched a Chinese website which its hopes will contribute to sales and profit growth in the long-term.

In the UK, Asos has benefited from price reductions over the past year, the launch of an Android App, increased digital marketing and range expansion, including popular high street brands including New Look and River Island.

Government Inquiry to Investigate Web's Impact on UK High Street

An inquiry that will examine the impact of the internet on Britain’s town centre shops is expecting contributions from across the industry by Monday.

The Department for Business, Innovation and Skills Select Committee wants views from industry and the public on five key issues. That includes evidence on progress made implementing the Portas review of town centres, which began almost two years ago, and opinions on 'the impact of online sales and direct sales on High Street retailers'.

The Select Committee will then hear views from selected industry figures and lobby groups over the coming months before reaching its conclusions. 

Key representations expected from High Street retail groups have already begun to emerge. Small shops groups argue that, while High Street retailers are taxed heavily through business rates and burdened by rents, online retailers are not. Retail lobby groups will suggest that online retailers such as Amazon, Ebay and Asos have an easy time because of this light touch. They are expected to demand a 'level playing field' on tax and insist a business rates system based on property in an online world is unfair and antiquated.

Other areas for the inquiry will include the continuing growth of out-of-town shopping developments, planning laws and restrictions to town centre shopping such as high car parking charges.

Opinion: Why this inquiry has received so little publicity is difficult to fathom. The announcement of March 13 was barely picked up by news services – on or offline - but its effects could be huge. Select Committees tend to act where ministers fail to do so (the last BIS investigation into the grocery industry in 2011 set up a watchdog in January to stop supermarkets bullying suppliers). The dividing line between online and High Street retail is actually a large grey area filled by those relying on both. The internet may even be saving some traditional store-based retailers from collapse.  

But the BIS inquiry into the retail sector is likely to highlight the disparity between a vibrant online sector and beleaguered, declining High Street shops. Politicians will act and such action is unlikely to favour online retailers. 

The effects of this little known inquiry could be felt across the online industry for years to come. 

http://www.parliament.uk/business/committees/committees-a-z/commons-select/business-innovation-and-skills/inquiries/uk-retail-sector/