
Latin American delivery startup Rappi valued above $1B - andreshb
https://www.axios.com/rappi-latin-american-delivery-valuation-unicorn-0c5d0743-fd41-4071-9270-928db470d6be.html
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lechiffre10
I've used Rappi here in Mexico and it's probably one of the worst delivery
services I've used. Just seems like they overextended themselves by going in
multiple directions without being quite efficient at them. Their website also
often shows promotions that suddenly disappear when you try to click on the
specific restaurant and you then have to plead your case to the customer
support representative. Overall not a very good experience. Their delivery
people often make mistakes with items too.

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murukesh_s
Unfortunate but It looks like signs of growth (VC triggered) though! Why do
people still use it? Guess there are no alternatives in Mexico?

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lechiffre10
Postmates and Uber Eats are here too. Can't really see why people would use
Rappi. You also have a service called Cornershop for groceries so Rappi's
competition here doesn't make it appealing.

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ASalazarMX
Cornershop is groceries delivery made right. The person who picked your items
is the same who delivers it to you, there's no dilution of responsibility.
Wrong product? missing items? bread crushed under the milk? They will own up
to it and fix it.

Previously we used HEB's own delivery service. One person picks your items,
other packs them and yet another delivers it. When something is wrong no one
owns up to it.

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jonifico
In Colombia, A LOT of the guys who work delivering in rappi are Venezuelan
people with no documents, they ride mostly bikes with no helmets or
protections at all ! And they are not social covered at all: no health or
professional risks, no vacations, etc etc etc ... That's the worst way to do
business, taking into consideration we are working hard (on Latin America) on
formalizing our employees.

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GFischer
The competition is fierce, here in Montevideo (Uruguay) it's unbelievable the
amount of delivery startups for a population of less than 2 million...

We have the local PedidosYa (sold to DeliveryHero), U.S. UberEats which is
making a heavy bid, Rappi as well, some other local challengers...

I love the services but some are too predatory (PedidosYa takes about 20% of a
delivery unless the restaurant has high volume).

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plumeria
In the Greater Metropolitan Area of Costa Rica (2.6M people) there's also a
lot of options, we've got:

\- UberEats (U.S.)

\- Glovo (Spain)

\- EatsOn (Costa Rica)

\- GoPato (Costa Rica)

\- Hugo (El Salvador; they haven't started yet though)

Other services have shutdown: QueComemos.com (Costa Rica) and Juanlotrae.com
(Costa Rica).

Uber in Costa Rica has 783K active users y 22K drivers.

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clamprecht
Anecdote from this past Tuesday, for what it's worth: At a Starbucks in Buenos
Aires, Rappi was set up at the table next to ours, doing interviews to hire
delivery people.

A friend who uses these services more than me said he likes Rappi because you
can see in real-time where your delivery is.

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gaastonsr
> he likes Rappi because you can see in real-time where your delivery is.

Same with Uber eats.

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pilaf
There's no Uber Eats in Buenos Aires yet though, and it would probably be a
pretty dangerous endeavor given how violently taxi drivers have been reacting
against Uber drivers. Any person on a bicycle or skates with an Uber logo on
them would essentially become a moving target for some frenzied taxi driver to
run over.

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btilly
I'm always a little suspicious of the reality of unicorns.

The way that the figure is derived is that people paid $X for portion Y of the
company, and therefore the company is worth $X/Y. The problem is that in
addition to portion Y, in a large deal the investors also get preferred stock,
downside protections, and so on. Those extras are worth something, and
therefore some of $Y is for THAT rather than a share in the company.

Therefore the company is always worth less than the figure you see reported.

See [https://www.fenwick.com/FenwickDocuments/The-Terms-Behind-
Th...](https://www.fenwick.com/FenwickDocuments/The-Terms-Behind-The-Unicorn-
Valuations.pdf) for more on this.

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jeff18
Reminds me of this comment
[https://news.ycombinator.com/item?id=17779751](https://news.ycombinator.com/item?id=17779751)
about DoorDash which was false. Given some of the same investors are in Rappi,
I would not immediately assume they have funky terms.

~~~
whoisjuan
First of all DoorDash and Rappi are not comparable, as much as they provide
the same type of service.

If you're rapidly growing company in South America trying to raise money from
American/Asian investors, you're already in disadvantage.

You could totally get competing term-sheets for a company raising money to
operate in these markets but nobody is dropping their pants to give money to
these companies when they could be easily pouring money into safer markets.
These are companies raising unprecedented rounds for markets in which the
delivery fees are in their majority under 1 USD. As they keep expanding and
growing their business they will have to shave a lot of profitability, while
dealing with the unpredictable economic nature of these countries (for example
Argentina, one of their markets, is currently going through an economic crisis
- their currency is basically worthless, bank rates at 60%, inflation expected
to be at 26% this year...not a great time to pay for food delivery)

I'm not saying that these investors are sharks and just being predatory for
the sake of being pieces of shits. What I'm saying is that given the market,
the opportunity, the risks, the environment and the competitive landscape is
very unlikely that they are leaving these deals without severely affecting the
common stockholder pool.

These investors have the fiduciary responsibility of getting the most out of
their funds and I really don't see why they would give 200MM USD to a company
that operates in emergent economies without getting a huge chunk of ownership.

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abcdcba
Here is a video of one of the founders yelling at their carriers
[https://m.youtube.com/watch?v=ooTmdOyKYpQ](https://m.youtube.com/watch?v=ooTmdOyKYpQ)

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maneesh
Rappi is such an amazing product. Better and more reliable than seamless and
GrubHub, in my experience. I used it in Medellin, Colombia.

~~~
raulgalera
same here, I used it a lot in Medellin and it was super convenient

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gfarah
Congratulations to Rappi, it’s crazy dificult to raise money in Latin America.
I’ve seen so many good teams/products/services fade away due to inability to
raise capital.

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gamesbrainiac
I remember when Pathao, a delivery service from my home country was valued at
100M, I thought it was a lot of money. Having spoken to the people who work
there, they told me that the margins are slim, so I'm guessing that you
basically make money on volume of deliveries.

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gomox
Rappi is so heavily price subsidized that I wonder what will happen with them
once they stop burning through VC. For perspective, the average delivery fee
in Buenos Aires is < $1, and they guarantee < 35min deliveries or your money
back.

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wallacoloo
Is there any other succinct way of describing "privately owned companies
valued at over $1B" besides as "unicorns"? The animal type of unicorn is
_awesome_ , and I feel actual unicorns ought to be protected from capitalism
(and probably from humans in general). Using the word in a business context
seriously detracts from how magical unicorns actually are.

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stephengillie
Narwhal-horse hybrids should be studied for any genetic or structural
uniqueness they might express. And their parents should be observed to
discover the mechanics of their copulation.

