Founded by executives from the financial and innovation sectors with experience in the Brazilian investment platform XP, the footwear startup Yuool is already used by people frequenting the buildings on Faria Lima Avenue, in São Paulo (a famous avenue that brings together large Brazilian companies and startups), and is now expanding its portfolio and preparing to enter the U.S. market.
The company had a revenue close to BRL 12 million in 2021 (70% higher than the previous year) and wants to double this result in 2022.
According to Eduardo Rocha, Yuool’s co-founder alongside Pedro Englert, Mateus Schaumloffel, and Eduardo Glitz, unlike what the executives of the foreign brands he talked to at the start of the company had warned, Brazilians were attracted by the comfort and look of merino wool shoes, a raw material that is popular in cold-weather countries.
“We saw a trend outside Brazil, in the United States and Europe, of shoes made of merino wool, and we tried to bring these players, who did not accept, saying that the product would not sell in Brazil. We decided to take on this challenge for ourselves, partnered with the footwear industry, and spent a year developing the product,” says the executive.
Four years since prototyping the first shoe, Yuool says it has already sold 100,000 pairs.
Rocha says that one of the obstacles to transforming merino wool shoes into a success with the Brazilian consumers was the manufacturing costs. The startup managed to lower the cost by eliminating intermediaries in the production chain. The solution was to do everything in-house: from raw material control to product development, besides concentrating 90% of sales in its own e-commerce, where the startup holds customer data to enhance marketing strategies.
“If we were a traditional retail chain, we would have to sell for BRL 800 in Brazil. But we end up selling for BRL 450 because there are no intermediary agents”, he says. By deciding to develop almost everything in-house, Yuool was able to attend market niches hard to be reached by the big retailers.
But what started with merino wool now extends to products that also use recycled pet bottles and organic cotton. The Home and Fit lines, both developed with these new materials, accounted for 43% and 22% of sales, respectively. The favorite pick of buyers last year was Yuool Fit Nero, which represented 13.32% of sales.
With this business approach, Yuool is able to talk to other target audiences that orbit this world of innovation and broaden its customer base beyond its colleagues from Faria Lima Avenue. Yuool shoes have become a common gift from some companies to their employees. Wholesale sales to companies such as Uber, XP, GBM, BTG, Inter, and Manchester Investimentos represented 10% of Yuool’s earnings in 2021.
This year, Yuool plans to launch new fashion and apparel products, moving away from being a brand focused just on footwear. The idea is to become a brand that specializes “in delivering comfort and quality items linked to well-being,” says Rocha.
Another project for 2022 is geographic expansion. The brand intends to start selling, as early as March, its products on Amazon American. “Our goal is to reach US consumers because we believe that our products can rival theirs,” he argues.
For this, the company plans investments that may reach BRL 4.5 million, three times more than what was initially planned for 2022 – and a quarter of this money may be allocated to the US market.
In Brazil, the idea is to increase the number of physical stores. Yuool currently has three units (in São Paulo, Porto Alegre, and Gramado), and plans to open three or four more, including the first in Rio de Janeiro.
With the new ventures, besides doubling revenue, Rocha expects the company to sustain its growth in the international market, which in 2021 was 127% (also driven by the devalued Brazilian real), with sales in Italy and Portugal.
The biggest challenge, he says, is to keep embracing new audiences, expanding the range of products, and bothering the big players in the sector. “They know of Yuool’s existence, and in some cases, they don’t like it. We need to keep protecting ourselves, and believing that our purpose is stronger.”