Mexico City-based online retailer Linio raised $55 million USD last week in another round of funding. The sum came from two Mexican investment funds, LIV Capital and Northgate Capital, along with Kinnevik, a Swedish fund that specializes in e-commerce.
The company says it will use the injection to fuel growth, invest in mobile applications, and launch a new payment program. “Linio today has the platform, equipment, and the capital necessary to consolidate its position as a leading e-commerce platform in Latin America for the long term,” said Alex Rossi, managing partner of LIV Capital.
Photo: Linio’s office in Bogotá employs 150 workers in a country where the online retailer makes almost one-third of its sales. (Credit: Jared Wade)
Outside of Mexico, the four-year-old company’s biggest market is Colombia, where it made nearly one-third of its $200 million USD of sales in 2015 and employs around 150 of its roughly 1,500 workers. In Colombia alone, Linio has 5,000 sellers in its marketplace that offer some three million products. It says it is adding an average of 200 more sellers to its network each month.
Even with sales rising each year, Colombia, like the rest of Latin America, has a very low penetration rate for online sales. Less than 3% of retail sales in Colombia are conducted digitally, according to the firm’s country manager Luis Eduardo López.
Regardless, this new funding round, Linio’s fourth overall, brings its total capital-raising efforts to more than $260 million USD, according to the Wall Street Journal. The source of the funding is also beneficial for the Mexican retailer since it reflects local interest and ensures that the domestic investors will have some understanding of the market.
“This new round of funding reflects the progress we have made towards technical and operational excellence in all aspects of our business,” said Andreas Mjelde, Linio’s CEO and co-founder. “Moreover, in an increasingly difficult fundraising environment, this capital round highlights our improvement in profitability, which lays the foundations for sustainable growth in the coming years.”