99 minutos: Mexico's last-mile delivery startup raises $40M in Series B funding

99 minutos: Mexico's last-mile delivery startup raises $40M in Series B funding

Alexis Patjane was with several friends at a local hookah bar in Mexico City in 2014 when the bar ran out of tobacco. They thought they could order some online and have it delivered in real-time to the bar, but such service did not exist.

Patjane was running a food truck manufacturing business at the time, which was responsible for around 80% of all food trucks in Mexico, so he was familiar with the region.

Patjane created 99 minutos, a website that sold the product and delivered them within 99 minutes, to tackle the quick delivery problem he had experienced at the hookah bar a few weeks later.

99 minutos said today that it has received a $40 million Series B investment from Prosus and Kaszek Ventures, which it will utilise to expand its business in Latin America.

The company presently operates in 40 major markets in Mexico, Chile, Colombia, and Peru, and offers four services: same-day delivery, next-day delivery, and CO2-free delivery.

What began as a fast-delivery e-commerce startup rapidly evolved into a last-mile delivery service for other e-commerce businesses.

Patjane told TechCrunch, “We started to build the API connections and plug-ins, and any e-commerce could add our delivery service to their business."

99 minutos earns money by charging a flat cost for delivery and then paying a flat rate to the driver, but the volume on each route has grown to the point where it's quite profitable. The company ships about 60-80 packages per route, furthermore customers get the flexibility to pause the delivery, change the address. At which Patjane explained: You can say, “Oh, I’m not at home, I’m at the Starbucks on the corner, can you drop it off there?”’

The company initially only delivered within Mexico City, but it quickly expanded to offer services between cities, and it now operates between 21 cities in Mexico.

99 minutes further stated that E-commerce is rapidly expanding in Latin America, yet it is still in its initial days. Latin America has a 6% e-commerce penetration rate, while China has a 30% e-commerce penetration rate and the United States has a 20% e-commerce penetration rate.

“When we hear big e-commerce players saying that 99 minutos is ‘their most reliable partner’ and that they are ‘the provider with the most potential,’ it tells us that the team is executing extremely well and is on a path to disrupt e-commerce delivery in Latin America,” said Banafsheh Fathieh, Head of Americas Investments at Prosus Ventures.

The company also aims to use the funding to accelerate city-to-city deliveries and shall be delivering from town to town the same day and use small planes to connect towns.

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