Merqueo, which operates a full-stack, on-demand supply service in Latin America, has landed $50 million in a Series C spherical of funding.
IDC Ventures, Digital Bridge and IDB Invest co-led the spherical, which additionally included participation from MGM Innova Group, Celtic House Venture Partners, Palm Drive Capital and former shareholders. The financing brings the Bogota, Colombia-based startup’s whole raised to $85 million since its 2017 inception.
Merqueo CEO and co-founder Miguel McAllister is aware of a factor or two concerning the supply area in Latin America, having additionally co-founded Domicilios.com, a Latin American meals supply firm that was purchased by Berlin-based Delivery Hero and later merged with Brazil’s iFood.
McAllister describes Merqueo as a “pure-play online supermarket with a fully integrated grocery delivery service” that sources straight from giant manufacturers and native suppliers, bypassing intermediaries and “delivering directly from its dark store network.” (Dark shops are conventional retail shops which were transformed to native success facilities.”
Merqueo affords greater than 8,000 merchandise, together with recent meals, packaged items, dwelling necessities, drinks and frozen merchandise. It presently operates in additional than 25 cities in Colombia, Mexico and Brazil and has over 600,000 customers.
Image Credits: Merqueo
It have to be doing one thing proper. The startup is near $100 million in “run-rate revenue,” in accordance with McAllister, having grown greater than 2.5x in 2020. Merqueo additionally reached optimistic money movement in Colombia, its most mature market. Over the final 12 months, giant Latin American retail chains and retailers have approached the corporate about probably buying it, McAllister mentioned.
Part of the corporate’s success is likely to be attributed to the pace and suppleness it affords. Users can select how and when to obtain their groceries in accordance with their wants, with the startup providing supply in as little as 10 minutes or three to 4 hours. Users also can schedule supply of their groceries in two-hour intervals for a similar day or the following day.
Also, proudly owning and controlling the “entire” vertical provide chain provides it the power to acquire higher margins, provide aggressive pricing and obtain wholesome unit economics, in accordance with McAllister.
Merqueo plans to make use of its new capital partially to develop geographically. The firm is presently in part certainly one of its growth to Brazil, getting into initially in Sao Paulo later this month. Next 12 months, it expects to launch in different Brazilian cities resembling Rio de Janeiro, Fortaleza and Salvador de Bahia.
The market alternative in Latin America is very large contemplating that on-line grocery gross sales solely symbolize simply 1% of the market –– far decrease than within the U.S., EU or China, for instance. Other gamers within the more and more crowded area embody GoPuff within the U.S., Getir out of Turkey and Mexico-based Jüsto, which raised $65 million in a Series A led by General Atlantic earlier this 12 months.
“The pandemic accelerated the adoption of online grocery shopping in LatAm,” McAllister informed TechCrunch. “The region went from 0.3% share of online groceries to 1%. And after the pandemic, we are seeing a 50% increase in the pace of user adoption.” Overall, the $85 billion e-commerce market in Latin America is rising quickly, with projections of it reaching $116.2 billion in 2023.
Currently, Merqueo has over 1,300 staff in LatAm, up 60% from final 12 months. It plans to proceed hiring with the proceeds from the Series C spherical as effectively work “to become the largest and most ambitious dark stores network of Latin America.”
Alejandro Rodríguez, managing companion at IDC Ventures, is of course bullish on Merqueo’s potential.
“From all of the alternatives we appeared into, Merqueo is undoubtedly essentially the most superior within the area. … The Merqueo group has proved they know the best way to scale the enterprise and the best way to get to profitability,” Rodríguez informed TechCrunch.
Online grocery supply is a…
