Santiago — Since its launch in 2020, e-commerce platform Merama‘s growth has accelerated, becoming Latin America’s latest unicorn in December 2021. Based in Mexico and Brazil, the company’s cofounders Domingo Cruzat and Manuel José León are actually Chileans.
The two met at university before working together at retail giant Falabella as high-ranking executives. It was León who persuaded Cruzat to join the platform, which focuses on sourcing e-commerce brands and buying a percentage to scale them into online sales channels. “We talked about the idea of doing things together. When the opportunity arose, I immediately talked it over with Domingo,” he tells Bloomberg Linea.
The answer was yes, and so Cruzat joined the team headed by Sujay Tyle (United States), and complemented by Felipe Delgado (Mexico) and Renato Andrade (Brazil). Today, the startup has reached a valuation of $1.2 billion, after closing a $60 million investment round in December.
The company’s business model attracts investors: Merama usually acquires a majority stake in a brand, allowing the founders to retain ownership, continue to operate the companies, and at the same time supports them with its team of e-commerce experts and working capital financing. By September, the startup had already raised an additional $225 million in Series B funding, an equity round that was co-led by Advent International and SoftBank Group.
“It was a well-powered burst of energy,” Leon said of the rapid capital raise.
The injection of funds will be used to strengthen its new division, Merama Labs, which operates with brands in the supplement, beauty and fashion categories. The capital is also aimed at continuing to develop technology to automate processes and, in addition, to continue the growth of the company, which already has more than 20 brands in its portfolio, operating in Mexico, Brazil, Chile, Peru, Colombia and the U.S.
Read More: Want to Learn How to Raise Money in LatAm?
How is Such Rapid Growth Achieved?
There is no single ingredient in Merama’s success. León explains that the growth of e-commerce was influenced by the pandemic. “There are very good brands in the region, operating in the countries where they were born. But there is still plenty of room to grow them in their own country and then take them to other countries,” he says.
Last year they began to see the results of their international expansion. For Cruzat, the company’s main driving force is the team and its leaders. “We were concerned about having a team with a lot of experience in e-commerce that comes from companies of the caliber of Amazon, Mercado Libre, Facebook and Falabella, among others”.
The Chilean entrepreneurs say that having a clear strategy has enabled the startup to move forward.
Cruzat emphasizes that the group of brands with which they have partnered has also been fundamental. “We have been very careful in choosing a brand, not only because it sells a lot, but also because it has good products”, he explains.
The company will continue to strengthen its work in Latin America, where there has been an exponential increase in the number of unicorns in the last four years. In 2021 alone, several were added to this mythical category, including Cornershop, NotCo and Ualá.
