1 Based on the data from the case (and any other sources available) use the frameworks from the chapter and analyse the resources and capabilities of Rocket Internet:

a What are its resources and capabilities?

b What are its threshold, distinctive and dynamic resources and capabilities?

Rocket Internet has continued to produce successful start-ups. Zalando, which initially mimicked the online shoe retailing business in the USA by Zappos, now part of Amazon, has expanded into clothing and jewellery. They are now the biggest online fashion retailer in Europe with rapidly growing sales (€4.5bn for 2017) and the company was stock listed in Germany in 2014 at €5.3bn. Other fashion brands have also been launched in the umbrella Global Fashion Group: Dafiti (Latin America), Jabong (India), Lamoda (Russia), Namshi (Middle East) and Zalora (South East Asia and Australia). Two high-profile IPOs in 2017 from Rocket Internet were Delivery Hero, an online takeaway food delivery company and HelloFresh, a mealkit delivery company. In 2018 the online retailer Daraz was sold to Alibaba.
However, Rocket Internet’s stock price has fallen close to 50 per cent since its listing and some investors have complained that the company is too complex to analyse and understand and questions its ability to become profitable and find enough successful exits for its many start-ups.
Rocket Internet has also started to attract imitators of its own. Wimdu, is a copy of Airbnb, which allows individual home and apartment owners to list their properties as holiday accommodation, but they quickly formed a partnership with another Berlin incubator for expansion into Europe. Similarly, the original company responded swiftly when Rocket Internet imitated Fab.com, a designer deal site, with its Bamarang. Fab acquired Casacanda, a parallel European site, and quickly re-launched it as a Fab internationally and Bamarang was closed down.
Rocket Internet is even facing imitators from within.
Four of the original managing directors who contributed to the initial success have left the company. They have all become active as venture capitalists and support companies in direct competition with Rocket Internet. Two, together with other former employees, left to set up the Berlin incubator ‘Project A Ventures’. Multiple venture capitalist firms and incubators from other parts of Europe have also emerged, like The Hut Group in the UK. There are thus signs that Rocket Internet may eventually be imitated itself. In addition, many of these new competitors are pioneering entirely new online ventures and business models rather than imitating existing ones. ‘The day an age of copying seems over’ according to Ciaran O’Leary, general partner at BlueYard Capital, a Berlin-based venture capital firm. However, these developments did not worry Rocket Internet CEO Oliver Samwer in an interview with Reuters12: ‘We are planting new seedlings so we can harvest them in 2020 and beyond. . . Small seedlings can suddenly grow big.’