Alibaba is folding up its U.S.-based e-commerce operation 11 Main and merging it into New York-based social marketplace OpenSky, according to reporting by TechCrunch.
In the process, Alibaba is taking a 35% stake in OpenSky, which also features logistics companies (and Alibaba U.S. properties) Auctiva, Vendio, and SingleFeed.
There have been or will be several layoffs at 11 Main, TechCrunch has learned but not yet confirmed, and it’s unclear whether 11 Main will survive as a brand.
Alibaba has invested loads of money in several U.S. startups, notably promising companies like Snapchat and Lyft. It’s also recently invested in flash-sale site Zulily, in a move signaling confidence in a company that has faltered a bit recently.
But the e-commerce giant hasn’t really gained much traction with a marketplace here; 11 Main was hardly a household word and likely didn’t have much of a chance in a market dominated by Amazon, eBay, and in its own quirky niche, Etsy. Still, OpenSky appears to have much potential and has attracted funding.
But e-commerce in the U.S. may be maturing, considering how many brick-and-mortar retailers have robust e-commerce operations, so, even with Alibaba's global power, there may not be whole lot of room for larger pure-play e-commerce marketplaces here.