This post is a fast follow to my previous analysis of the UBHoldCo cap table. It is based on the Unybrands Operations Financial Statement published by the UK Companies House on 3 April 2025, which collaborates my hypothesis that Affinity Partner’s potential investment of ~$200M is irrational and perhaps explains why so many investors fled the Unybrands cap table.

The “So, What?”

Let’s start the story at the end and work our way backwards to the beginning — this will make what would normally be a boring financial statement more interesting. As before, the goal here is to educate the public, e-commerce brand sellers and anyone interested in what went wrong in the Amazon aggregator industry.

Per the UK Companies House, the Unybrands 2023 financial metrics you should focus on are:

• Revenue: $130.2M (page 15) vs $78.7M in 2022
• Gross Profit: $39M (page 15) vs $19.2M in 2022
• Finance Expense: $12.8M (page 15) vs 8.7M in 2022
• Loss Before Taxation: $33.3M (page 15) vs $70.4M in 2022
• Contingent Consideration (<1 year): $13.7M (page 16) vs $20.0M in 2022
• Borrowings (>1 year): $74.9M (page 16) vs $70.6M in 2022 (<1 year)
• Employee Wages & Salaries: $11.8M (page 42) vs $8.7M in 2022
• (Potential) lack of compliance with a credit facility (page 56 last sentence)

We also know from this UK Companies House document, that a $107.5M “Affinity Investor hurdle” exists that I previously speculated is some sort of debt-note sitting on Affinity Partner’s books — basically because 1) the CrayHill Aurora Capital (debt) charge was released on Unybrands Ltd; 2) no (debt) charge exists over UBHoldCo; and 3) and the “Affinity Investor hurdle” is described as “the aggregate of $32,500,000 (less $491,000) plus $75,000,000” and — if you notice — Unybrands Operations mentioned a $74.9M non-current (greater than one year) borrowing on page 16.

We can use these data points and mathematical analysis to infer other key facts about Unybrands’ performance, total valuation and share price in the prior two (2) years:

• Unybrands total valuation possibly collapsed 98% to ~$9M in 2023 whereas Affinity Partners invested $75M in 2022 at an implied valuation of $377M
• Between the $75M equity investment and the possible $107M debt-like note, Affinity Partners sank about $200M into a company that lost $100M in just two (2) years — which does not seem rational
• Unybrands per share valuation is ~$30/share when estimated with UBHoldCo’s total share count of 199,231 but just $0.36/share if the share count had remained the 16,750,621 shares listed for Unybrands Ltd (when Affinity Partners paid $22.50/share)
• Revenue per employee of about $810K; gross profit per employee of about $255K — both somewhat low versus a high-performance e-commerce brand
• Total wages & salaries per employee of about $81K — which is low and at odds with the hypothesis that 1) aggregators hire the “best and brightest” e-commerce expertise to “boost” the performance of acquired e-commerce brands; and 2) they are building “technology platforms”

How Did We Get Here?

Valuation

Before the aggregation bubble imploded, irrational valuations of 4 - 6x EBITDA (or more) were not uncommon. Since the bubble burst, the market cooled to a more normal 2 - 3x EBITDA. Assuming a generous 3x EBITDA multiple and using the Unybrands Operations financial statement, this suggests the valuation of the entire company would be about $39M x 3 =$117M (based on gross profit) minus $108M (the debt-like “Affinity Investor hurdle”), which is ~$9M.

Since the A, B and C shares in UBHoldCo have a 1.5x liquidation preference, this effectively means the 2023 real per share price is 9,000,000/(199,000x1.5) = ~$30/share using the UBHoldCo share count. Adjusted to match the Unybrands Ltd share count, it would be 30 x (199,000/16,750,000) = $0.36/share in 2023 (whereas Affinity Partners paid $22.50/share a year before in 2022). So, in about one (1) year Affinity Partners’ investment effectively went from $22.50/share in 2022 to $0.36/share in 2023 — a collapse of 98%.

My hypothesis is the total number of shares in UBHoldCo was changed to ~200,000 to ensure the per share price (i.e., $30/share) was greater than $22.50/share to save face (i.e., “optics”) — that is to look good on paper for any future investor who did not look too closely at the details.

Per Employee Performance and Compensation

In this CNBC article, Unybrands stated "headcount has grown from 115 employees in January 2022 to more than 230 employees as of this year”. Thus, we estimate the 2023 per employee revenue to be between $130M / 230 = ~$510K and $130M / 115 = ~$1.1M; let's take the mid-point of $810K, which is somewhat low compared to a high-performance stand alone e-commerce brand. The 2023 per employee profit would be between $39M / 230 = ~$170K and $39M / 115 = ~$340K; again taking the mid-point of $255K per employee.

The implied per employee wages & salaries was between $11.8M / 230 = ~51K and 11.8 / 115 = ~$100K; so let's take the mid-point of $81K. This is at odds with the promise that Amazon aggregators pour significant e-commerce (and technology) expertise into “boosting” the e-commerce brands they purchase — if you know anything about the e-commerce space, you know that good e-commerce talent comes at a much higher wages than $81K. And given the wages of technology expertise easily exceeds $150K, it seems they employ very little software developers, data engineers and so on — which makes claims by Amazon aggregators about being “technology companies” as trustworthy as Adam Neumann’s claim that WeWork was a “technology platform” (spoiler alert - WeWork went spectacularly bankrupt).

Interest Payments and e-Commerce Seller Earn-outs

The interest payments on the loans used to acquire e-commerce brands was about $13M; so Unybrands had an “interest coverage ratio” of 39 / 13 = 3, which is borderline between “OK” and “risky”. However, if you consider the current (due in less than a year) contingent consideration (i.e., the performance earn-out due to sellers who sold their e-commerce brand to Unybrands), then the ICR is 39 / (13+14) =1.4, which is a very poor ratio (i.e., very high risk). Since the earn-out essentially is a type of “seller financed loan”, it makes sense to compute the ICR using both the interest due on (regular) borrowing and the contingent consideration.

There is an interesting paragraph tucked into page 56:

“On 28 June 2021, the group entered into a Senior Facilities Agreement with an external finance provider, which includes stated interest rates of 13% for the first $50m of borrowings, 12% for borrowing amounts between $50m and $100m, and 11% for borrowings in excess of $100m. The first drawdown occurred on 1 July 2021. The available credit facility and amount borrowed were $200m and $78m as at 31 December 2023, respectively. The group incurred debt issuance costs of $1.7m, which is being amortised to interest expense over the term of the debt. The terms of the debt permit the group to draw on the facility to fund acquisitions.

The group is required to repay amounts borrowed under the facility by 2 January 2026. On 31 December 2023, the group complied with all non-financial and financial covenants. There has been no other non-compliance to date.”

The final two sentences suggests that for at least part of 2023 Unybrands was not compliant with some aspect of its credit facility (i.e., loan) it used to purchase acquired e-commerce brands. We know this credit facility was with CrayHill Aurora Capital thanks to the UK Companies House because the date in the paragraph (i.e., 28 June 2021) matches the date when CrayHill Aurora Capital recorded its (debt) charge against Unybrands.

Conclusion

The recently published UK Companies House document provides intriguing clues as to why so many investors fled Unybrands’ cap table; and it deepens the mystery of why Jared Kushner’s Affinity Partners would invest ~$200M in an Amazon aggregator with such a weak financial profile. The potential 98% decline in valuation within 12-months raises questions on competence and if any reasonable due diligence was followed during the investment. I will quote this paragraph from the New York Times April 2022 around the time that Affinity Partners invested $75M in Unybrands:

A panel that screens investments for the main Saudi sovereign wealth fund cited concerns about the proposed deal with Mr. Kushner’s newly formed private equity firm, Affinity Partners, previously undisclosed documents show. Those objections included: “the inexperience of the Affinity Fund management”; the possibility that the kingdom would be responsible for “the bulk of the investment and risk”; due diligence on the fledgling firm’s operations that found them “unsatisfactory in all aspects”; a proposed asset management fee that “seems excessive”...

What You Have Before You is...

To quote the great scene from the Pentagon Wars:

So in summation gentlemen, what you have before you is... an Amazon aggregator loaded with so much debt it can't afford to buy e-commerce brands; a technology platform that can't afford software engineers; and a quasi-private equity company worth only about $9M that spent more than $100M to buy $130M in revenue... Congratulations and God Bless America!