A glimpse into Keith Rabois and Atomic’s new Miami startup

March 25, 2021, 3:28 PM UTC

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Investor Keith Rabois has been a vocal proponent of moving to Miami. One of his latest moves after migrating to the city has been founding a new startup dubbed OpenStore. Little is known about the business aside that it plans to acquire small e-commerce players, according to Axios.

But on Wednesday, Rabois, who founded OpenStore alongside venture studio Atomic’s Jack Abraham, offered a glimpse into what the startup is trying to tackle.

“What I think is missing in e-commerce is serendipitous discovery,” Rabois told CNBC. “Amazon is a wonderful product with a wonderful experience…if you know what you want. The reason why [physical] retail is still the vast preponderance of transactions is that people discover things that they don’t necessarily think, from a utilitarian standpoint, that they needed.”

While Rabois was still scant on the details, as the startup is in stealth, he did hint at the strategy of the nascent business.

“What we’re hoping to do and aspiring to do is bring that experience online through not necessarily an IAC kind of rollup. I think we’re thinking of a unified consumer experience, stitching together a lot of small micro-merchants that are long-tail merchants today and giving them access to data, information, and capital they don’t have today.”

The term long-tail is of particular interest. While Rabois didn’t really elaborate on it, he does appear to point to a popular strategy that allows businesses to profit from selling niche offerings rather than massive blockbuster hits. And while there has been an explosion in companies seeking to acquire e-commerce businesses that list on Amazon, OpenStore for now seems to want to operate outside of the Amazon ecosystem.

“We have plans to scale massively in Miami and make OpenStore the largest company in the city’s history,” Jack Abraham, founder and managing partner at Atomic, told Term Sheet on Wednesday. The idea for OpenStore came together in December of 2020, he says, after both he and Rabois agreed there was a gap in the “non-Amazon part of the market.”

Openstore is one of three startups Atomic is currently working on out of Miami, where Abraham moved to from San Francisco in the summer. What was intended to be a short visit with friends became a month-and-a-half-long convalescence after Abraham contracted COVID, and inadvertently, he says, fell in love with what Miami had to offer. He found himself becoming more productive during his lengthened trip. The time difference gave him a three-hour head start to much of the startup world on the west coast. And as the pandemic worsened, Atomic decided to open up a shop in Miami. 

Access to talent was critical in its original decision to open up an office in New York, says Abraham. But then remote work meant talent could be accessed from anywhere. The venture studio, which both invests and creates its own startups, plans to have enough office capacity for 30 to 40 people to start. Atomic still plans to grow its San Francisco presence, he adds.

FANATICS: Sports merchandising company Fanatics has raised $320 million at a $12.8 billion valuation, over double its price tag less than a year ago. Investors included Silver Lake, Fidelity Investments, Franklin Templeton, Neuberger Berman, Thrive Capital and Major League Baseball. Read more.

Lucinda Shen
Twitter: @shenlucinda
Email: lucinda.shen@fortune.com


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