Dive Brief:

• According to a filing last week, Alibaba Group Holding Ltd. has taken a stake in U.S. flash-sales retailer Zulily Inc. of more than 9% of shares, making Alibaba a “ten-percent owner.”

• The Chinese retail giant spent $56 million on Zulily shares last week after the small e-retailer’s stock fell precipitously after a disappointing earnings report, adding to a previously undisclosed stake Alibaba already owned.

• Alibaba says it’s not interested in acquiring the company outright.

Dive Insight:

Alibaba’s earlier stake in Zulily was previously not known, and it adds to the Chinese giant’s investments in U.S. companies that are seen by some as a step into the market. Some of Alibaba’s investments are likely as much about learning about the new market as control, but Alibaba could have many reasons for its interest in Zulily. It could be that Alibaba is interested in Zulily’s vendor relationships, for example, or it may want to influence the shape of Zulilly's retail approach. 

Either way, what this means for struggling Zulily, whose fortunes have clouded over since its early promise, is so far unclear. 

Despite Zulily’s struggles, Alibaba said in a statement that it has “a compelling vision for the future.”