Nuvemshop, known as Tiendanube in Spanish-speaking countries, was founded in 2011 and offers a suite of tools around payments, shipping, inventory management and marketing for online businesses. It currently serves nearly 80,000 merchants across Brazil, Argentina and Mexico.
Accel led the new round with participation from ThornTree Capital and existing investors including Kaszek and Qualcomm Ventures, as well as a group of e-commerce leaders including Mike Micucci, Mark Lavelle, Mark Lenhard, Jamie Sutton, Kevin McKeand and Minesh Shah. The Series D brings Nuvemshop’s total funding to date to $128.4 million, according to Crunchbase data.
Despite raising money last October, after meeting with Accel it made sense to move forward with another round of funding, Santiago Sosa, co-founder and CEO of Nuvemshop, told Crunchbase News
“It was not about the money, but Ethan (Choi) and Andrew (Braccia) have experience in e-commerce and Latin America itself,” he added. “It is the right fit, and we feel confident that they will help in the next stage of our growth.”
E-commerce is booming in Latin America, where there are more than 650 million consumers, with 479 million already connected online, Sosa said. At the same time, online retail sales in the region account for approximately $84 billion and is projected to hit $116 billion by 2023.
However, Latin America continues to have low e-commerce penetration, presenting tremendous growth and economic impact in the region, Sosa said. For example, Brazil, the most populous country in the region with over 200 million people, doubled e-commerce penetration last year from 5 percent to 10 percent. However, he estimates penetration will grow dramatically, and could be 30 percent to 40 percent in 10 years, he added.
“When we think about the future, we envision commerce will be digitized,” he added. “We are at the beginning of a transition where the infrastructure needs to be built. All of these smaller merchants need payments and logistics tools.”
In the past year, Nuvemshop tripled its customer base and its revenue, Sosa said. The new funding will enable Nuvemshop to continue developing new capabilities, including tools for payments and logistics management. It will also expand its presence in Brazil, Argentina and Mexico, as well as establish itself in new markets, including Colombia, Chile and Peru.
As part of the investment, Andrew Braccia, partner at Accel, joins Nuvemshop’s board. He believes the company is building a product that creates opportunity for local merchants to connect with customers, and the new round enables Nuvemshop to build a stronger balance sheet and take advantage of opportunities in Brazil and Argentina.
“Over the last 12 to 18 months, there is an urgency and a real need for merchants and customers to be able to move toward an e-commerce solution,” Braccia said. “Santi and his team are taking an underpenetrated market and providing a product that is becoming a critical product to have for merchants and customers. It’s not a question of inevitability, it was when and it just happened to have been through a pandemic.”