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New York-based Quiet Capital, Mountain Nazca out of Chile, Spain’s Vas Ventures, Silicon Valley-based 500 Startups, other unnamed funds and angels also participated in the round, which comes just months after the company raised a pre-seed round of an undisclosed amount.
Ricardo Weder, former president of Cabify (a large ride-sharing company operating in Latin America, Spain, and Portugal) founded Jüsto earlier this year with a mission to “disrupt the Latin American grocery industry.”
At first, Jüsto operated a website only but recently launched a mobile app. It is the first supermarket in Mexico with no physical stores, according to Weder.
How It Works
Customers can buy their groceries directly from the website or via the app and Jüsto delivers the order to the customer’s location of choice.
While other entities such as Walmart, for example, deliver groceries in Mexico, Jüsto prides itself on working directly with fresh produce suppliers in an effort to offer “the freshest” fruits, vegetables, meats and fish in the market. It also offers a variety of products such as pantry staples, personal hygiene and beauty, home and cleaning, drinks and pet-related items.
Mexican, and Latin American consumers as a whole, have been reluctant to order groceries from some of these larger retailers and companies due to concerns about freshness and quality, Weder said.
The company opts to choose items only from local suppliers, thus giving them a new channel to sell their products (which can get buried in larger supermarkets). Jüsto also prides itself on developing fair trade agreements with suppliers.
Initially, Jüsto is focused on Mexico City but plans to expand into additional Mexican cities as well as other regions in Latin America such as Brazil, Colombia, Peru and Chile, according to Weder.
Rodolfo Gonzalez, partner at Foundation Capital and also a Mexico City native, said he was impressed with Weder’s work at Cabify and was excited to get involved with this venture early on.
“We’ve seen that type of model of warehouse and D2C for groceries be very successful in other geographies,” he told me. “But that model didn’t quite exist in Mexico yet.”
Increased internet penetration and the availability of smartphones in the region “opens up a world of opportunity for an entrepreneur to reach consumers directly,” Gonzalez said.
The investment in Jüsto marks Palo Alto, Calif.-based Foundation Capital’s fourth LatAm investment. It’s also backed Colombian unicorn Rappi. The funding is also another example of increasing global investor interest in Latin America. Mexican startups in particular raised a total of $310 million in venture funding in the first half of 2019, according to LAVCA, compared to $75 million in the first half of 2018, as you can see in the chart below.
Illustration: Li-Anne Dias