Cubbo: E-commerce Fulfillment in Latin America

Cubbo Secures $4 Million Seed Funding to Expand E-commerce Fulfillment in Latin America

Cubbo, a Colombian startup specializing in e-commerce fulfillment, has successfully raised $4 million in seed funding. This investment coincides with the company’s launch of operations within Colombia, following an initial rollout in Mexico earlier this year.

Company Origins and Leadership

Founded in January, Cubbo is guided by the leadership of Brian York and Josu Gurtubay. York’s personal history is particularly noteworthy. He experienced early life on the streets of Bogota before being adopted and raised in Boston.

His connection to Colombia was rekindled in 2017 when he began a search for his biological family and successfully re-established contact. Before establishing Cubbo, York had already founded three separate startups based in San Francisco.

Prior to Cubbo, York and Gurtubay collaborated within the third-party logistics sector, eventually transitioning their focus to direct-to-consumer e-commerce through this new venture.

Transforming Urban Spaces

The company’s core vision centers on revitalizing urban areas throughout Latin America. As an example, Cubbo repurposed a derelict building in Mexico City into a modern urban fulfillment center to serve its client brands, as explained by York.

“A significant portion of our clientele utilize platforms like Amazon and Mercado Libre. We efficiently manage their direct-to-consumer inventory, alongside serving some of the largest customers operating outside of Mexico,” York stated. “Currently, in Mexico, we are uniquely positioned to process orders received up to 5 p.m. for same-day delivery within Mexico City. While Amazon and Mercado Libre also offer this service, they require earlier order submissions due to the location of their warehouses outside the city limits.”

Operational Focus and Cost Management

To maintain cost-effectiveness and enable same-day order fulfillment, Cubbo concentrates on handling non-perishable items that are relatively small in size – comparable to a shoebox. This includes products such as cosmetics, consumer electronics, and apparel.

The company doesn’t operate its own transportation fleet; instead, it collaborates with third-party logistics providers to manage last-mile delivery after the picking, packing, and bundling of packages have been strategically completed.

Investment Details

The recent funding round was spearheaded by SV Latam Capital, with participation from Bragiel Brothers, BluStone, and a collective of angel investors. These investors include Federico Malek and Nicolas Gonzalez Luna (founders of Wonder Brands), Olivier Scialom (co-founder of Merama), Tono Mandly (co-founder of RioGrande), Alexis Patjane (CEO of 99 Minutos), Ricardo Weder (CEO of Justo), and Florian Hagenbuch (CEO of Loft).

Future Expansion Plans

York plans to allocate the funding towards the continued development of operations in both Mexico and Colombia, as well as preparations for a launch in Brazil. The company experienced its highest daily order volume in November, representing a 600% increase compared to previous months.

Cubbo anticipates a doubling of its revenue by the year’s end. The company has rapidly grown its team to include 16 members in Mexico and three in Colombia.

York intends to utilize the funding to strengthen the leadership team and is also planning to initiate a Series A funding round in early next year, with the goal of achieving cash flow positivity by the second quarter of 2022.

Strategic Vision

“We are fortunate to have strong support within our specific market segment,” York commented. “Approximately 20% of sales for brands in Latin America originate from direct-to-consumer channels, and there is a widespread desire for growth over the next five years. Therefore, it’s crucial for brands to control their data and enhance the customer experience, which is the central theme of our approach.”