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20 May 2019, Stella Zlatareva, EMIS M&A Team

Rappi, the Colombian on-demand delivery app, raises USD 1bn from SoftBank

Another month, another fund-raising record. This time around, Colombia’s delivery start-up Rappi is in the limelight, having secured a USD 1bn investment from the most generous VC backer of modern times – SoftBank. The funding round is the largest Latin America-bound technology financing to date. It also marks the inaugural investment of the Japanese giant’s Innovation Fund, a USD 5bn vehicle focused exclusively on backing tech start-ups in Latin America.

Where will the money go?

At this point, such mouth-watering investments in young, still loss-making companies are barely a surprise. Nevertheless, Rappi (which has been boasting a unicorn status since its 2018 Series D) seems very convincing in the execution of its ambitious plans, and it has already demonstrated the ability to grow aggressively last year by registering a seven-fold increase in the volume of goods delivered.

Rappi’s pitch, following in the footsteps of China’s WeChat (which provides everything from instant messaging to access to public services) is to become a multi-service “super app” for the region – a goal shared by many aspiring start-ups around the globe. More directly, the newly raised funds will be used to strengthen Rappi’s operations in existing markets (Brazil, Colombia, Mexico, Argentina, Chile, Uruguay, and Peru), to stimulate its expansion into additional Latin American countries, and to launch new products and services. In Brazil, for instance, the app targets to more than triple the number of cities where it operates to 70.

Rappi says

The app’s founder claims Rappi will keep investing in innovation and will aim to create proportionate opportunities for the millions of Latin Americans. Original source: EMIS - DealWatch