Ep. 33: Pulppo Saudi Arabia-backed Seed round, 99minutos’ latest product, Amplifica Capital first fund, and more.
Welcome to Scenius Mexico: Your weekly newsletter on technology, innovation, and startups in Mexico.
Early-stage financing rounds are becoming smaller in 2023, but it is interesting to note the growing interest of investors from other parts of the world, as this week DAAL Ventures from Saudi Arabia enters into the Mexican market. Could it be that risk averse U.S. funds are leaving a space open for new investors that might not have the chance to get into the best deals in 2021 and 2022? If so, we will witness an interesting evolution of the ecosystem in the coming years.
Meanwhile, startups with a solid financial base keep shipping new products at a fast pace. And once again 99minutos is making the headlines with its platform Ruta99. The startup is on its way to become the operating system for e-commerce companies in Mexico.
Another growing trend for successful Latin American Startups is to focus their international expansion effort on the region's second biggest market. This week we are talking about Brazilian QuintoAndar and Argentinian 123 Seguros.
Equity Funding Rounds
Scouter closes a US$250.000 Pre-Seed round
The Startup founded by Mauricio Almeida is building a marketplace that allows renting any space or location for video production and events. This financing round is completing a US$200 thousand round closed last year from 500 Latam and a group of business angels. The funds will be used to expand to new cities in Mexico such as Monterrey, Guadalajara, and Mexico City.
Despite the downturn economics and a client base focused on Startup at first, the team still found profitability on its offering and experienced important growth last year. This growth is due to an increase in demand from the audiovisual sector in Mexico in general and the alternative places offered on their platform.
Sector: Marketplace
Total Raised: US$0.5 million
Founders: Mauricio Almeida
Investors: 500 Latam, Business Angels
Pulppo raises a US$5 million Seed round from Saudi Arabia
The startup operates as an online broker, offering everything an agent needs to manage a property, from appraisals to home visits. It tracks prices and helps reduce the selling time for properties.
This new funding will support the company’s plans to grow its operations in Mexico and expand to other Latin American markets. It is Saudi Arabia-based VC DAAL Ventures’ first investment in Mexico.
Sector: PropTech
Total Raised: US$6.7 million
Founders: Matias Gath, Agustin Iglesias
Investors: DAAL Ventures, Boost Capital, Y Combinator, 1984 VC, Newtopia VC
Startups News
Startup 99minutos launches new product: Ruta99
The scale-up 99minutos is shipping new services at an accelerated pace. As recently as September the team was announcing Fullfil99, a Fulfillment by Amazon-like service, and today is back with Ruta99 - a platform for last-mile delivery management.
This software comes in addition to the service already offered by the company to deliver any product in under 99 minutes. With more than 50 million packages managed by its team, the next step was to digitally optimize the delivery routes for an ever faster last-mile delivery promise.
We can see how the startup is positioning itself to be a full-service solution on everything logistic related, and serve as the operating system for e-commerce growth in Mexico.
Aerus Startup orders 30 Eviation Alice Electric Aircraft
The startup is aiming to create new opportunities for regional travel in Mexico that are environmentally and economically sustainable. Aerus hopes to support tourism and economic development in northeast Mexico. Meanwhile, it also has ambitious plans for growth. By 2030, the startup wants to operate longer domestic flights across the whole country, as well as "a variety" of international flights.
The Alice is a nine-seater, fully electric commuter aircraft that became the first of its kind to fly when it conducted a test flight over Moses Lake in Washington in September last year.
VC - M&A News
LACBAN is the new initiative of the WBAF
I know, that’s a lot of acronyms! The WBAF is the World Business Angels Investment Forum, and this week it announced the opening of the Latin America and Caribbean Trade Association for Business Angels with the purpose to reduce the funding gap in the region, foster liquidity for local stock markets, and work with commercial & trade chambers to grow the number of business angels.
The association headquarters will be located in Mexico City and lead by famous business angel Marcus Dantus. You can read more on Bloomberg Linea (ES)
Amplifica Capital closed a US$11 million in capital commitments for its Fund
Founded by Anna Raptis in 2020, with the thesis of “celebrating, magnifying and amplifying the success of female founders in the region,” the first fund exceeded its $10 million target and has nearly 100 investors, including Mexico Ventures (a joint venture between Fondo de Fondos and Sun Mountain Capital); Grupo Herdez; Maria Ariza, CEO of BIVA; Melanie Devlyn, CEO of Devlyn Holdings; Daniel Undurraga and Oskar Hjertonsson, founders of Cornershop; and Loreanne Garcia co-founder of Kavak.
Raptis explained to TechCrunch that there are a lot of new funds in Mexico, but believes Amplifica’s success in raising money was because its focus on female founders is unique.
Amplifica has invested in 10 companies so far, including inter-city mobility services startup Kolors, Verqor, focused on agricultural financing for inputs, and Mujer Financiera, an Argentine company providing tools for financial inclusion for women. In addition, Raptis wants to invest in 10 to 15 more companies in the next two years.
Colombian Hogarú and Mexican Homely merge to grow internationally
The two cleaning service startups have been in talks for over a year and decided to join forces in 2023 with the goal to grow their revenue by 40% this year. While the two companies are offering the same service, they were so far focused on different segments of the market, with Homely serving corporations, and Hogarú serving everyday people.
Hogarú’s CEO Juan Sebastián Cadavid, an ex-Rappi, will keep the role of CEO in the newly formed entity and be in charge of growing the company internationally both in the B2B and B2C segments.
Rest of the World
Brazilian QuintoAndar send one of its co-founders to Mexico
The second most valuable startup in Brazil is betting on the Mexican market for 2023. The team decided to relocate its CTO, André Penha, to Mexico City in order to develop their PropTech platform locally.
In Mexico, the startup operates under the name Benvi, and from the CTO’s words, this is more than a copy/paste of their product in Brazil, but a tailored one answering the particular requirements of the local market - for example on the credit validation and risk management sides.
InsurTech 123 Seguros is expanding to Mexico
The Argentinian startup obtained a broker licence approved by the Comisión Nacional de Seguros y Fianzas de México and decided it was time to come for Latin America's second biggest market. With operations in Argentina, Brazil, Chile, and Colombia, the estimated US$12 billion Mexican market was the evident next step.
Still, the team will face the same challenges as in the rest of the region: a lack of confidence in insurance companies with a low penetration rate. 123 Seguros hopes that its fully digital and user-friendly product will help onboard more people and build the trust needed to grow.
Nick is the Cofounder and Co-CEO at Finerio Connect, the largest Open Banking API in Spanish speaking Latin America. He has worked at Santander, Deloitte and as a consultant for more than 100 startups. He is also the recipient of the NYU Distinguished Young Alumni Award.
What would you have liked to know before starting your company/career?
I wish I knew how important raising capital was to being able to innovate early on. We really bootstrapped for a long time. When you have something new you need time to prove the model out and while that happens, having the backing of investors who can also help smooth this process is a huge advantage.
What do outsiders often fail to understand about your company?
Many try to paint a picture of Fintechs vs Banks but we don't see it that way. We think there are many opportunities to better serve banks and allow them to innovate in an agile way. We truly believe that incentives can be aligned and have started to rally many traditional institutions and banks around the idea of using Fintechs as service providers.
What's one thing you can keep talking about for hours?
Personally I'm fascinated by history and anthropology. Anything from the French Revolution to Pre-Hispanic Americas.
What’s the weirdest job you’ve ever had to do?
I was a deckhand on the biggest party boat in New York City and it was pretty wild. My shifts usually went from 6PM to 8AM the next morning and I saw people on that boat partying from every walk of life possible.
What makes you bullish on the Mexican startup ecosystem?
The fact that we're solving really hard and relevant problems. That's always a good sign, and while not everyone will be able to do it, it also means that this ecosystem isn't going anywhere anytime soon and there's lots of room for growth for those who get it right.
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