Walmart’s new e-commerce boss Marc Lore unveiled ‘Store No. 8’, the company’s new tech incubator located in Silicon Valley, at the Shoptalk conference.
Wal-Mart Stores Inc. is creating a technology-startup incubator in California’s Silicon Valley to help identify changes that will reshape the retail experience in the next few years, including virtual reality, autonomous vehicle and drone delivery, and personalized shopping.
The incubator will be called Store No. 8, a reference to a Wal-Mart location where the company experimented with new store layouts.
It makes sense for Walmart to tap into the innovation happening at startups and in the valley in particular. That Walmart chose the incubator model over a corporate venture model is interesting. On one hand this lowers the attractiveness for a lot of startups to even consider participating, on the other hand it makes it easier for Walmart to deploy its (non-monetary) resources and help the startups succeed. For startups focused on the US market this can potentially be significant.
Walmart is not publicly committing to a specific amount of money they will be pouring in over a given time frame.
Read into this what you may.
Speaking at this moment, Marc Lore said, “The difference here is that Walmart will invest in these businesses like a VC and grow the group as a portfolio”. Adding, “We’ll be bringing in entrepreneurs and giving them capital, and give them the opportunity to change the course of retail five or 10 years out.”
Many big companies have internal venture arms. And Walmart already has an internal research lab, @walmartlabs, that has focused on developing new e-commerce applications for the retailer.
But Store No. 8 is the first incubator or investment arm of its kind at Walmart, which has a market value of $213 billion. […]
Store No. 8 is meant to foster relationships with entrepreneurs, particularly those in the fields of artificial intelligence, autonomous vehicles and other emerging technologies. […]
As with everything e-commerce at Walmart these days, (ex-)members of the Jet.com executive team are leading the initiative:
“When the mother ship is ready, we’re sort of ahead of the eight ball,” [Katie Finnegan, who led Jet’s corporate development and has a background in fund-raising and mergers,] said. “Our goal is to have whatever we work on integrated into the mother ship.”
This looming integration into the mothership, again, makes sense for Walmart. I am not sure though how founders will see this. If you succeed you will be assimilated by the Borg.
In other words, the pre-selection of startups und founders this will create may not be exactly what Lore and Walmart had in mind for their new online portfolio.
At the least, cutting edge this will not be.
But still, US e-commerce desperately needs more investor activity. This is a start.
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