Amazon Rolls Out New Marketplace for Startups

Amazon Rolls Out New Marketplace for Startups
Image credit: REUTERS | Rick Wilking

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This week Amazon unveiled a new program geared towards startups called Amazon Launchpad, which will help entrepreneurs "launch, market and distribute their products."

Similar to other ecommerce platforms like Shopify and Bigcommerce, entrepreneurs will be able to use the platform to set up a storefront, providing users a simple onboarding process, custom product pages, inventory management and marketing materials.

But what may give Amazon an advantage is its audience and fulfillment capabilities. The website has millions of monthly visitors, allowing entrepreneurs the chance to get in front of a massive audience without spending a ton on marketing expenses. Amazon will be offering a suite of marketing tools that includes supported merchandising placements on the site, along with an invitation to join the Amazon Vine review program.

Related: Next Up for Amazon...Drive-Thru Grocery Stores?

The platform also allows startups to take advantage of its storage facility, customer-service center and shipping arrangements. While this is definitely an advantage, by putting your products in the hands of a third-party you can lose a degree of control over the process. Amazon has not released its cost structure, and upon publication Amazon had not responded to a request for comment.

The tech giant is partnering with 25 crowdfunding platforms, startup accelerators and venture capital funds including Indiegogo, Y Combinator, CircleUp and Andreessen Horowitz to get businesses they work with involved with the program.

Related: How to Get Your Business on Amazon's New Home Services Platform

Currently, 200 products in categories ranging from beauty products to wearable tech are available to purchase from the Amazon Launchpad store from companies like littleBits, a startup that makes DIY hardware kits to sustainable water filter maker Soma and mattress startup Casper.

This isn't the first time lately that Amazon has launched a new section to court startups and small business owners. The spring saw the roll out of Amazon Exclusives which featured the fruits of successful Kickstarter campaigns and pitches on ABC's Shark Tank, and Handmade at Amazon, a hub meant for artisans and artists to ostensibly take aim at sites like Etsy.

But Amazon isn’t the only game in town. Last year, eBay also worked with CircleUp to develop Innovators Collective, a similar system in that the products get a dedicated page complete with video, and those interested in the product can purchase and make returns through eBay.

Read more: Amazon Launches New Storefront for Shark Tank and Kickstarter Successes

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