SoftBank Vision Fund invests $100m in e-commerce startup in Brazil

Pedestrians walk past a SoftBank Group Corp. store in Tokyo, Japan. Photographer: Tomohiro Ohsumi

SoftBank Group Corp.’s Vision Fund has invested $100 million in Brazil-based delivery startup Loggi, betting on the county’s rapid e-commerce growth.

Headquartered in Sao Paulo, South America’s largest city, Loggi flags delivery requests to nearby couriers, from motoboys (or motorcycle messengers) to vans. The widely used app calculates the fee and route.

Co-founded in 2013 by Fabien Mendez — who occasionally delivers packages himself — Loggi previously raised $3.3 million from Qualcomm Ventures and Dragoneer Investment Group, and is raising $111 million in total in this latest funding round.

“Brazil is lacking in good connectivity,” Mendez said by phone. “The big issue is logistics. It can take an average of 10 days for an e-commerce delivery”

Unlike many rival delivery startups, Loggi’s platform caters to both the transport of goods and food delivery. This allows drivers to switch between delivery options, avoiding the traditional lull between mealtimes. It’s a similar model to that of Rappi, a Colombian firm that just hit $1 billion in valuation last month. Amazon.com Inc. is also working on a pilot logistics project in Brazil with Goldman Sachs-backed CargoX.

SoftBank is no stranger to betting on delivery apps. Earlier this year it led a $535 million investment in DoorDash Inc., a food-delivery app based in San Francisco. It also bought a 15 percent stake in ride-hailing giant Uber Technologies Inc., which transports people and food in Brazil and elsewhere.

“Brazilian logistics is fragmented, inefficient and under-invested, making it an attractive market for disruption,” said Akshay Naheta, partner at SoftBank Investment Advisers. “We believe Loggi is the market leader and is unlocking the growth of the on-demand economy.”

On top of its technology platform, Loggi will invest in robotics and engineering. It manages 12 mini-hubs across Sao Paulo, where packages arrive to be sorted into time- and cost-efficient routes and then picked up by drivers in less than an hour.

E-commerce sales in Brazil are expected to increase by 12 percent to 53.5 billion reais ($13.7 billion) this year, according to sector researcher Ebit. That compares to a growth of 7.5 percent in 2017. However, most deliveries are still done by large trucks, and many roads are unpaved. The trucking industry went on strike in May, massively disrupting the economy.

A former mergers and acquisitions analyst, Mendez is keen to expand Loggi from beyond the major cities. The startup is now notching 3 million deliveries and growing 25 percent a month he said. He declined to comment on revenue numbers, but added that Loggi broke-even at the end of 2017.

Bloomberg

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

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Following vacancies can be applied for (only in Singapore).   

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  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.