In order to better compete with arch rival Amazon.com, Wal-Mart is hoping to profit from the benefits of its investment arm, which will focus on tech startups, so as to better compete in its e-commerce push.
The world’s largest brick and mortar retailer, Wal-Mart Stores Inc, has stated that it will be launching its first investment arm in partnership with venture capitalists, retail startups and entrepreneurs, in order to expand its e-commerce business.
This strategic plan is being spearheaded by Wal-Mart’s e-commerce chief, Marc Lore, who joined the company from Jet.com, which Wal-Mart acquired in August for more than $3 billion.
Since then, the Bentonville, Arkansas-based company has acquired three small web retailers to its portfolio to service millennial shoppers.
The investment arm, called Store No. 8, will work with startups that specialize in areas including, virtual and augmented reality, robotics, artificial intelligence and machine learning. Wal-Mart has stated it will be based in Silicon Valley.
In a strategic decision, Wal-Mart will keep the startups separate, from its broader organization, so that in the near term they do not affect the company’s bottom lines, said Seth Beal, Wal-Mart’s senior VP of incubation and strategic partnerships, in an interview.
Beal did not provide a timeframe for Store No. 8’s launch.