99minutos, a logistics services company for e-commerce providers throughout Latin America, is rapidly attracting funding. It announced 82 million dollars in its last round of the Serie C, led by Oak HC/FT, with participation from existing investors Kaszek and Prosus Ventures.
This latest round follows a reversal Serie B 40 million last May from Prosus and Kaszek and brings the company's total financing to around 128,7 million. That's when the origins of the Mexico City-based company, founded by CEO Alexis Patjane, who had been running a food truck manufacturing business in Mexico, were exposed.
Patjane said he wasn't looking for additional capital immediately after Series B closed and, in fact, had plans to start raising again this year. However, opportunities arose with new clients, the company was growing, and there was a lot of interest from venture capital firms.
"That interest didn't happen before," he added. “It was a round that changed our lives. We contacted 77 funds, with three saying 'yes' and the rest saying 'no'. It was depressing to hear all the 'we's. Now that we have positioned the brand and the company, getting the interest of the other side is flattering and helps things move faster.”
I was particularly interested in speaking with Oak HC/FT because of their global presence and approach to bringing their portfolio companies together around advice and tips for founders. Patjane did not disclose the valuation of 99minutos, but he did say that the company does not want to be a unicorn now and that in the next round it could announce something bigger.
Since e-commerce and logistics companies like Amazon came to Mexico, a lot of infrastructure has been created around this industry, Patjane said. Traditional carriers like FedEx and DHL were there before, as were country-specific delivery companies, but the service was expensive, not available every day, and not tied to technology.
such as e-commerce retail market in South America is poised to hit $160 million by 2025, compared to an estimated $85 billion in 2021, Patjane believes 99minutos it must be the first technology company to build the logistics infrastructure needed to grow, to have a fast delivery experience: receive packages tomorrow instead of 10 days from now, and we offer specialized services.
The company in 2021, was operating in 40 markets and is now in 60 markets in Mexico, Colombia, Chile and Peru, with the goal of opening in two more countries, yet to be determined, this year. Patjane plans to have 95% penetration in all of its current markets before connecting services to other countries.
Meanwhile, the company handles more than 15 million packages a year, aiming to deliver them in less than 99 minutes, the same day or the next day through its fleet of electric vehicles.
Patjane intends to invest the new funds to scale new business models, expand into new geographic areas with Latin America and new sustainability initiatives in line with the company's low-carbon goals, and increase its use of electric vehicles.
Some of its new offerings since the last surge include Punto 99, a collection and delivery network that addresses the entire fulfillment and returns process. The company has opened more than 500 stations, including label printing stations, where people can pick up or drop off their packages. Patjane hopes to increase the number of such "centers" to 8.000 in Mexico by the end of the year.
It also has a SaaS route tracking and optimization tool for customers called Route 99 that determines the best way to get a package to its destination and in what type of vehicle.
Meanwhile 99minutos It has 5.000 employees working in Mexico, Colombia, Chile and Peru, and Patjane aims to reach between 8.000 and 10.000 by the end of the year. It is also working with more than 120.000 clients, mainly B2B. Revenue grew three times year over year.
Allen Miller, director of Oak HC/FT, said in a written statement that the growth experienced in the Latin American e-commerce industry in recent years has facilitated the need for better technology to get orders to their final destination.
"99minutos is meeting this need and has impressively expanded beyond its core last-mile offering to become the leading technology fulfillment and logistics company in the region,” added Miller. "We look forward to supporting the team as the company continues its growth and expansion in LatAm."
