Jet.com Raising up to $500 Million Led by Fidelity at $1 Billion Valuation

Jet.com has signed a term sheet for a huge new funding round led by mutual fund giant Fidelity, multiple sources told Re/code. The ambitious e-commerce startup is raising as much as $500 million at a valuation of around $1 billion pre-money, these people said, with Fidelity contributing around $100 million of the total. The total could end up being lower than $500 million, one of these people cautioned, since the entire round has not yet closed.

Spokespeople for Jet and Fidelity declined to comment. Fortune first reported news of the deal.

Jet.com just launched publicly in July but has already raised more than $200 million in financing based on the big vision and experience of its CEO Marc Lore. Lore was the co-founder and CEO of Diapers.com parent company Quidsi, which he sold to Amazon for more than $500 million after Amazon tried to crush it.

With Jet, Lore has said he wants to build a giant e-commerce marketplace that differentiates itself through a unique discounting structure. Jet’s system, dubbed Smart Cart, typically awards discounts to shoppers who buy multiple products at a time because those orders often are cheaper for partner retailers to fulfill. The website also offers discounts to shoppers who pay with a debit card instead of credit card or agree to waive their right to return an item.

Jet initially provided up-front discounts on individual products, too, but moved away from that part of its model when it recently dropped its $50-a-year membership fee. Jet generates revenue by taking a cut of sales from partner retailers and by selling some categories of products itself as the merchant of record. Jet customers bought more than $10 million, $20 million and $30 million of goods in its first three months, respectively.

This article originally appeared on Recode.net.