HBC, the owner of Saks Fifth Avenue, said on Friday it would launch the luxury department store’s e-commerce segment as a separate business following a $500 million infusion from Insight Partners, a U.S. private equity firm, in the online business.

Online demand for expensive makeup and handbags has received a boost during the COVID-19 pandemic, prompting luxury goods sellers to double down on their e-commerce business at a time when store traffic has been under pressure.

“Luxury ecommerce is poised for exponential growth,” HBC Chief Executive Officer Richard Baker said.

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Insight’s equity investment values the online business, called Saks, at $2 billion, HBC said, adding the retailer’s 40-store fleet would operate separately and would be referred to as SFA.

Marc Metrick, the chief executive of the combined firm, would helm Saks, with former Amazon.com Inc executive Sebastian Gunningham also joining the e-commerce company’s board.

Insight Partners has invested in a range of technology and e-commerce companies, including Shopify Inc and Qualtrics Inc.