Chiper has been amassing a network of digitized corner stores in Latin America for the past two years. Now armed with $12 million in Series A funding, the Colombia-based e-commerce platform for independent merchants is poised to capture even more corner-store retailers.
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Investors in the round included WIND Ventures, Monashees and Kaszek Ventures. The company previously raised $13 million from family and friends, giving it $25 million in total fundraising since the company’s inception in 2018, Jose Jair Bonilla, co-founder and CEO of Chiper, told Crunchbase News.
Prior to founding Chiper, Bonilla was co-founder and CEO of Imaginamos, a software studio in Latin America that touts incubating successful startups, including Rappi. He is now joined at Chiper by co-founders COO Oscar Sarria and CRO Carolina Garcia.
Importance of the corner store
Small corner stores are a vital retail channel in Latin America, generating more than $330 billion in annual revenue, Brian Walsh, head of WIND Ventures said in an interview. In addition, they are the place where more than 65 percent of groceries are purchased.
“They use corner stores as their refrigerators, buying food there every day rather than taking it home,” Walsh said.
However, each corner store is typically run by an independent owner and that’s resulted in a fragmented landscape and challenges to technology adoption.
Chiper is creating an opportunity to grow its own company, while at the same time helping corner stores increase the average $30,000 to $60,000 in revenue they receive each year, he said.
“This is a big and important market, but small stores face poor owner experience and suboptimal customer experience,” Walsh added. “They are also not making as much profit, and therefore are unable to invest in technology. Jose and his team are leaders in this space, driving digital transformation of this important retail channel.”
Chiper provides customized technology to corner-store owners and their product suppliers, including inventory procurement, management and fulfillment, so that owners can make smarter purchasing decisions, have improved store efficiency, and offer a better customer experience.
“We consolidate everything that an independent store needs into one platform, offering them great prices, next-day delivery and a convenient service to find anything they need,” Bonilla said.
The new funding will be used to expand Chiper’s customer base. The company has 3,000 monthly active users and is targeting 30,000, or 5 percent market penetration by the end of 2021, he said. The company will also invest in its technology, and intends to increase its employee base by 30 percent.
In addition, Chiper intends to launch in four news cities in Mexico with plans to expand next into Brazil. The company is already operating in four cities in Colombia and two in Mexico.
“We acquired our first user in 2019, but since then, we have averaged about 20 new users per month and have learned very fast how to help them use technology to run their business,” Bonilla said. “Now we are able to demonstrate that if you have a good value proposition, users are going to go to your platform.”
Illustration: Li-Anne Dias