Addi raises $75M to advance ‘buy now, pay later’ in LatAm, nearly

Buy now, pay later is officially everywhere, and Latin America is no exception.

Today a startup in this field, etc., is announcing a $75 million expansion in its Series B, bringing the total round size to $140 million. In late May, the startup announced that it had raised $35 million in equity round led by Union Square’s Opportunity Fund and $30 million in debt funding from Architect Capital.

The company, which has dual headquarters in Bogota, Colombia and So Paulo, Brazil, declined to reveal its new valuation other than to say that it is “nearly triple” what it was 90 days ago when it released the first installment of its series. But it was closed. B, and it is now in the range of “hundreds of million” dollars.

New York-based Greycroft led the expansion, which included participation from new backers GGV Capital, Citius Capital and Intersection Growth Partners, as well as existing investors Union Square’s Opportunity Fund, Andreessen Horowitz, Endeavor Catalyst, Foundation Capital, Monash’s and Kona Capital Was.

With the latest financing, Addi has now raised a total of $220 million in debt and equity since its September 2018 inception – over $140 million in equity and over $80 million in debt.

Addi Co-Founder and CEO Santiago Suarez said, Daniel Vallejo and Elmer Ortega The company started with a vision to make digital commerce a reality in Latin America – an area where an estimated less than 25% of people have a credit card.

“To do this, we had to solve the payment problem,” he said. “We wanted to make frictionless payments possible while allowing customers to afford what they want.”

Addi started with the Buy Now, Pay Later feature that allowed consumers to shop within minutes with “just a few clicks”. Today, the company allows customers to pay for their purchases over three months at no cost. For larger purchases, Addi lets them pay for up to 24 months in what it describes as “competitive and reasonable rates”.

Addi is currently available for e-commerce, mobile and brick-and-mortar purchases in Brazil and Colombia, with plans to expand to Latin America in the coming years. Specifically, it plans to enter the Mexican market in 2022.

According to Suarez, Addi has increased its GMV (gross merchandise volume) by 13 times since the beginning of this year.

“And our ARR has seen a similar increase,” he said.

Addi, like many other companies, temporarily saw a slowdown in business as a result of the COVID-19 pandemic. But it quickly bounced back.

“We lost 99% of our GMV in 20 days when the pandemic hit. “We had to make some painful decisions, including letting go of many of our colleagues at a very difficult time,” Suarez recalled. “We also focused the business on e-commerce and digital payments, and we haven’t looked back since then.”

As a result, Addi reached its pre-COVID high again in March/April 2021, and has grown almost 3 times since then.

Suarez said that for now, the company is focusing more on growth than profitability.

“This round increases our focus on making digital commerce ubiquitous and accessible in Latin America,” he said.

Indeed, Latin America led the world Growth in e-commerce sales last year. For its part, Addi currently has over 150,000 subscribers, a number that is growing from 30% to 40% month on month. On the merchant side, it has close to 500 merchant partners, including brands such as Arturo Calle, Mario Hernandez, Keep Running and Claro. Earlier this year, it entered into a strategic partnership with Banco Santander.

Addi currently Is More than 260 employees (or as Suarez put it, partners), less than 120 a year ago. The company prides itself on being “one of the few Latin American startups” that offers equity to everyone on staff.

“And we make it a point to speak about partners and co-owners rather than employees,” Suarez told .

The company plans to use the new capital to accelerate its Product roadmap and geographic expansion. On the product side, it will launch a “one-click checkout solution” for its merchant partners and customers by the end of the year. As mentioned earlier, Addi will accelerate its foray into Mexico, where it aims to launch in early 2022.

Greycroft’s Thabet Mahayani said that before investing in AD, his firm had been tracking startups “for a long time”.

“Apart from an exceptional team, we believe the BNPL value proposition is stronger in LatM than anywhere else in the world,” Mahayani told . We … believe they have the opportunity to radically reshape the entire consumer payment experience in this space.”

This is partly because at present, consumers in Latin America have very few options for credit, he explains. Card access is very low and those who apply for credit face “a cumbersome and frustrating application process,” Mahayani said.

And those who have credit cards are often given very low limits with high interest rates.

“It is easy to see how this dynamic makes it difficult and costly for consumers to access secure and reliable credit,” he said.

According to Mahayani, Addi has “rebuilt the entire onboarding, underwriting and fraud stack to provide consumers with secure credit options, while enabling merchants to meaningfully increase their basket size and GMV.”

This is the second LatM investment for Greycroft, which previously invested in Rocket.chat, a Brazilian enterprise communications and collaboration platform.

Next year in Mexico, Addi will join current player, Nelo. that startup raised $3 million in April and at that time, was live with over 45 traders and over 150,000 users. Also, earlier this year Alchemy Entered the Mexican Market.

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