99minutos, a logistics service company for e-commerce vendors across Latin America, is making fast work out of attracting funding. It announced today $82 million in Series C funding, led by Oak HC/FT, with participation from existing investors Kaszek and Prosus Ventures.
The last round follows a $40 million Series B investment last May from Prosus and Kaszek and brings the company’s total funding to about $128.7 million. It was then that we learned about the origins of the Mexico City-based company, founded by CEO Alexis Patjane, who had been running a food truck-making business in Mexico.
Patjane told TC that he wasn’t immediately looking for additional capital after closing the Series B, and in fact had plans to begin raising again this year. However, opportunities with new customers came along, the company was growing and there was a ton of interest from venture capital firms.
“That interest didn’t happen before,” he added. “It has been a life-changing round. We contacted 77 funds, and three said ‘yes,’ and the rest said ‘no.’ It was depressing to hear all of the ‘nos.’ Now that we have positioned the brand and the company, getting interest from the other side is flattering, and helps to make things move faster.”
He particularly was interested in speaking with Oak HC/FT because of its global presence and approach to bringing together its portfolio companies around tips and advice for founders. Patjane didn’t divulge 99minutos’ valuation, but did say the company is now shy of being a unicorn, and in the next round, he would be able to announce something bigger.
Since e-commerce and logistics companies, like Amazon, came to Mexico, there has been much infrastructure created around this industry, Patjane said. Traditional companies, like FedEx and DHL were there before, as were country-specific delivery companies, but the service was costly, not available every day and wasn’t tied to technology.
As the retail e-commerce market in Latin America is poised to reach $160 million by 2025, compared with an estimated $85 billion in 2021, Patjane believes 99minutos needs to be the first technology company to build the logistics infrastructure required to scale, to have a fast delivery experience — getting packages tomorrow instead of 10 days from now — and offer specialized services.
When we last reported on the company in 2021, it was operating in 40 markets and is now in 60 markets across Mexico, Colombia, Chile and Peru, with a goal of opening in two more countries, yet to be determined, this year. Patjane plans to be at 95% penetration in all of its current markets before connecting services to other countries.
Meanwhile, the company is handling over 15 million packages per year, with a goal of delivering them in less than 99 minutes, same-day or next-day via its fleet of electric vehicles.
Patjane intends to invest the new funding into scaling new business models, expanding into new geographic areas with Latin America and new sustainability initiatives in line with the company’s low-carbon goals of increasing its use of electric vehicles.
Some of its new offerings since the last raise include Punto 99, a pick-up and drop-off network that addresses the entire fulfillment process and returns. The company opened more than 500 stations, which include printing stations for labels, where people can pick up or drop off their packages. Patjane expects to increase the number of those “hubs” to 8,000 in Mexico by the end of the year.
It also has a route tracking and optimization SaaS tool for customers called Routa 99 that figures out the best way to get a package to its destination and in what kind of vehicle.
Meanwhile, 99minutos has 5,000 employees working from 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 over 120,000 customers, mainly business-to-business companies. Revenue grew three times year over year.
Allen Miller, principal at Oak HC/FT, said in a written statement that the growth experienced in Latin America’s e-commerce industry of the past few years has facilitated a need for better technology so that orders make it to their final destination.
“99minutos is meeting this need and has impressively expanded beyond its core last-mile offering to become the leading technology logistics and fulfillment company in the region,” Miller added. “We look forward to supporting the team as the company continues its growth and expansion in LatAm.”
