Shopper taps the second fund round of the year: BRL 170 million from GIC, Singapore's sovereign wealth fund
Shopper's co-founders: CEO Fabio Rodas, and COO Bruna Vaz. Photo: Gabriel Reis/Courtesy

Shopper taps BRL 170 million from GIC and gets close to a unicorn valuation

Brazilian 100% online grocery store focused on scheduled shopping already has 500,000 registered users and plans to reach 120 cities and debut in Rio de Janeiro next year

Ler em português

Brazilian Shopper, a 100% online grocery store, tapped a BRL 170 million Series C round led by GIC, Singapore’s sovereign wealth fund, and followed by existing investors such as funds Quartz, owned by José Galló, Renner’s chairman; Minerva Foods; the multifamily office Oikos, and Floating Point.

With the funding round, the second raised in just six months – in May, the startup secured a BRL 120 million Series B –, Shopper is close to becoming a unicorn, according to its co-founders, Fábio Rodas (CEO) and Bruna Vaz (COO), told LABS in an interview. “In 2021 we raise more than 30 times what we got in the first five years,” said Fabio.

Founded in 2015, Shopper presents itself as the largest 100% online grocery store in Brazil, operating in 75 cities in the state of São Paulo and with half a million registered users on its platform. The company does not disclose absolute numbers but claims to have tripled its size year over year since it started operating.

READ ALSO: Brazilian startup Merama turns one year old and gets a unicorn as a gift

2020 was a kind of turning point for Shopper. The e-commerce boom driven by the COVID-19 pandemic especially impacted the food sector and the startup saw its demand grow to such an extent that it needed to stop the grocery shopping and delivery service for three weeks to restructure the operation to handle the new volume of orders.

“We had to open an extra night shift so quickly. We were not able to increase the operation at the same pace as the demand grew. As we didn’t want to deliver a bad shopping experience, we chose to shut down temporarily and tailor the operation to keep quality,” Bruna recalled.

READ ALSO: Shopper: 100% online Brazilian supermarket raises a BRL 120 million Series B

The startup‘s steady performance got the attention of investors, and Series B came along. “Until the pandemic, online grocery shopping was not a very attractive model for investment funds. With the pandemic, the sector became the apple of investors’ eyes,” said the entrepreneur. The C Series ended up being a consequence of the company’s strong growth pace.

Many new players entered this market, but we kept growing steadily even in a year when the sector faced the so-called ‘COVID hangover’. This was a factor in our favor when we decided to raise another round this year. We think it is important to have these funds to continue accelerating.

Bruna Vaz, co-founder and COO at Shopper

Shopper’s business model was inspired by the Subscribe & Save concept, very popular in the United States, in which the consumer chooses the products on the website or app, defines the delivery day, and completes the purchase. The products are delivered at home and the shopping list is saved on the website or in the app, with delivery automatically pre-scheduled for each month. The customer receives reminders to update the item list or change upcoming deliveries.

READ ALSO: Latin American e-commerce to skyrocket 37% in 2021, shows EBANX’s Beyond Borders 2021/2022 study

Scheduled shopping adds two valuable assets to the operation for any B2C startup: recurrence and predictability. Thus, Shopper minimizes the risks related to the so-called “peak demand” and maintains low inventory levels. This model reduces costs with inventories maintenance and products losses, generating an economy of 12% in comparison with traditional grocery stores that also offer online shopping, according to the startup.

In May of this year, Shopper launched Fresh, for scheduled deliveries of fruits, vegetables, and refrigerated and frozen products, meeting customer demand for fresh produce. “We now have a complete supply solution for customers. But it was a challenge because Fresh’s inventory is more sensitive. So, before setting up the operation, we did countless storage tests, on how to arrange the packing of products – the refrigerated products go with frozen bottles, the frozen ones go with dry ice, for fruits and vegetables, we tested fractioning –, on how to make the delivery maintaining the quality,” Bruna explained.

READ ALSO: Latin American startups get bigger fatter checks in November: average round size jumps from $13M to $31.9M

All the Shopper’s technology is proprietary, from the distribution center management system to the consumer apps for shopping. The company has today one distribution center in Osasco city, with 15,000 square meters, where it receives the products bought from suppliers and does all the picking, packing, and shipping processes. The delivery logistics is also done by Shopper.

According to Bruna and Fábio, by assuming all the operation phases, the startup has higher quality control. “Today our NPS is 87“, said Fábio. NPS stands for Net Promoter Score, a methodology that evaluates customer satisfaction and loyalty.

READ ALSO: Mexican Clara taps $70 million and comes to Brazil as a unicorn

Now, with the newly raised Series C round, Shopper plans to reach 120 cities in the state of São Paulo and to debut in Rio de Janeiro city next year. Two distribution centers are expected to start operating soon, one in Barra Funda, a neighborhood in São Paulo city, and another in Ribeirão Preto city, to optimize delivery service to countryside cities. Part of the capital will also be injected in technology, in hiring to triple the team, currently about 1,000 employees, and in new customers acquisition. The startup plans to reach 1 million registered users by October 2022.