Jüsto grabs new capital as it expands grocery delivery in Brazil, Peru – TechCrunch

Mexico City-based online grocer Jüsto is still running at full capacity with the goal of saturating the Latin American market.

The company claims to be the first supermarket in Mexico without a physical store that allows customers to shop directly through its website or an app, and Jüsto will deliver the order to the location of the customer’s choice.

We previously reported on the company last February when it raised $65 million in a Series A round led by General Catalyst. At the time, CEO Ricardo Weber told TechCrunch that the company, which was founded in 2019, has weathered the first year of the global pandemic well, seeing sales grow 16-fold in 2020.

Weber planned to use the Series A financing to expand into Mexico and Latin America — a market he believes represents a $600 billion opportunity — which is exactly what the company did.

“The global pandemic has helped a lot in food acceptance in Latin America,” he added. “It used to be 1% and now it’s 3% and it’s growing aggressively.”

Those few percentage points of adoption helped Jüsto become “gangbusters,” growing fivefold in Mexico and achieving a 99.4% fulfillment rate in the past 12 months. It now has more than 100,000 users in each of its markets and Weber predicts it will number in the millions by the end of the year.

It entered the Peruvian market late last year after acquiring local e-grocery Freshmart and has since announced the opening of its first brick-and-mortar store in Lima to offer a hybrid supermarket model. It also launched Ekonofresh, an online discount supermarket that is complementing its Freshmart offering to give customers even more choice there.

The Jüsto team, with CEO Ricardo Weber fourth from the left. Image Credits: Jüsto

The company also launched in Brazil last October in São Paulo and has seen steady growth of between 30% and 40% month-to-month, and the region already accounts for 25% of Jüsto’s total sales, Weber said. There are now plans to expand to other cities, including Belo Horizonte, Rio de Janeiro, Porto Alegre and Curitiba. Weber expects to be able to move to 20 additional cities in the coming years.

That further expansion is supported by another round of funding, this time $152 million in Series B funding, again led by General Catalyst. New and existing investors including Tarsadia Capital, Citius, Arago Capital, Foundation Capital and Quiet Capital also joined the round to bring Jüsto’s total venture capital investment to date to more than $250 million.

“Right now, we believe we have a mature value proposition, especially as our business is aggressively expanding and we’re improving technology to scale operations,” Weber said. “We are the largest grocer in Latin America and we see the biggest companies, such as Walmart, as competitors, so there are still things we can do to increase our share. Supermarkets in particular are focusing on infrastructure, which is what Jüsto is aiming for also after.”

Weber also has an eye on Colombia and Chile and is strategically looking at when is the right time to move to those countries, either directly or through acquisitions like Jüsto did in Peru.

The company has collected between 7,000 and 8,000 SKUs, with the main categories being fruits, vegetables, proteins and cleaning products. That’s about 2,000 SKUs more than last year, depending on the city.

Subsequently, Jüsto focuses on further personalizing its products in each city. It is also developing its relationships with small and medium-sized farmers to buy directly from them, while continuing to focus on sustainability and reducing waste.

Meanwhile, the US online grocery store is poised to be a $187.7 billion industry by 2024, up from $95.8 billion in 2020. Delivery is dominated by established companies such as Walmart, Instacart and DoorDash, and startups for delivery around the world are also experiencing success such as in raising venture capital.

For example, Rino recently took $3 million to deliver groceries in Vietnam, Bokksu is now valued at $100 million after raising $22 million, JOKR and Gorillas have billions of dollars — in the case of Gorillas billions — while Egypt’s Breadfast and Appetito and India’s Zepto have also cashed in over the past six months.

Obviously there are many movers and shakers in this industry, but grocery delivery is also a challenging industry. Last month, BayArea Inno reported that Zero Grocery was shutting down just a month after I reported they raised $12 million. In a Facebook post, the company stated, “Fundraising has always been the biggest battle we’ve had to endure. Unfortunately, it’s the battle we’ve lost.”

Weber also noted that grocery delivery “wasn’t easy, especially on the operational side,” and it became even more challenging as a business grows. That’s one of the reasons Jüsto has focused on the full shopping cart approach, with the goal of people doing all their shopping through the company rather than just a few convenience items, he added.

Zeev Thepris, senior associate at General Catalyst, agreed, saying he’s seen both fast trading and full basket models in Latin America, and while delivery is difficult to set up, he likes the full basket method. a better way to unite economy that are healthy.

“It’s not about convenience, it’s about people making purchases once a week with a $100 to $150 order ticket versus $15 to $20 for those convenience purchases,” Thepris added. “That’s what makes unit economics work.”

This post Jüsto grabs new capital as it expands grocery delivery in Brazil, Peru – TechCrunch was original published at “https://techcrunch.com/2022/04/07/justo-series-b-grocery-delivery-brazil-peru/”

Leave a Reply

Your email address will not be published.