Why We Invested: Chiper

nov. 01 - 2023
Why We Invested: Chiper

Unveiling Untapped Markets: The Hidden Potential of Mom & Pop Stores 
The Mom & Pop stores industry in Mexico & Colombia represents a significant opportunity for innovative disruption. With an informal economy in Mexico, for instance, that encompasses a substantial portion of micro, small and medium businesses, these establishments contribute around 26% of the country's GDP and employ approximately 60% of Mexicans. One segment of the traditional "Mom & Pop" stores, also known as abarrotes or tienditas, are family-run local convenience or grocery stores. They constitute a crucial part of the informal economy, resulting in a USD $30 billion industry. These stores serve as essential community hubs, offering a wide array of products and services to local consumers. 

Challenges Turned Catalysts: The Evolution of the Tienditas
However, tienditas stores face numerous challenges. They often operate on irregular incomes, making it difficult to manage inventory and purchase supplies when needed. Many of these stores lack modern technology and business practices, leading to inefficiencies and limited financial transparency. Additionally, their bargaining power is weak when negotiating with larger suppliers, and they struggle to offer a diverse range of products and services. 

Simplifying Success: Chiper's Digital Transformation for Small Retailers 
Chiper addresses these pain points by providing an end-to-end solution for tienditas. They have developed a comprehensive platform that offers financial products and services exclusively for this channel that has been historically limited in their access to capital. Chiper's digital platform facilitates order placement, inventory tracking, analytics, and customer relationship management.

A Winning Edge: Chiper's Holistic Approach in a Competitive Market 
Chiper's competitive advantage lies in its holistic approach to modernizing and digitizing the tienditas’ supply chain. Unlike partial solutions that focus on specific aspects such as e-payments or PoS systems, Chiper offers a comprehensive solution that addresses the entire value chain. This approach appeals to both tienditas store owners and CPGs. For CPGs, Chiper provides a route-to-market strategy and valuable consumer insights, while tienditas benefit from improved inventory management, access to digital tools, and potential revenue growth.  

The Visionary Team Behind Chiper
Chiper's leadership team, led by co-founders Jose, Oscar, and Carolina, boasts a blend of tech expertise, logistics experience, and a deep understanding of the tienditas market. Jose, Chiper's current CEO, formerly led Imaginamos, a Colombian digital transformation startup behind the launch of Rappi, while Oscar, also from Imaginamos, adds a strong tech background and operational edge. Oscar's prior role at Quala contributes insights into distribution and logistics, complementing Carolina's frontline familiarity with DDDedo, a Colombian mobile prepaid refill system spanning 15,000+ tienditas, enriching their customer insights. Backed by a diverse team, including CPG and startup backgrounds, they strive for rapid yet sustainable market expansion. 

Strategic Synergy: FEMSA and Chiper's Shared Vision for Growth
FEMSA Ventures recognizes the strategic upside of investing in Chiper. By participating in a company that aligns with its mandate to explore alternative options and hedge its position in strategic areas of interest, FEMSA gains valuable insights into the battle for the tienditas segment. The potential for collaboration and synergies between KOF and Chiper is substantial. FEMSA Ventures envisions strategic introductions to CPGs, sharing operational expertise, and exploring partnerships that benefit both parties.  

 A Shared Vision: Chiper and FEMSA Ventures in Retail Reinvention 
Chiper recently introduced Chiper Ads, a marketplace for advertising monetization tailored to CPGs. The aim is to improve their advertising strategies, optimize revenue models, and foster brand adoption. This means that CPG brands can now bid for advertising space on Chiper's platform, boosting sales in specific regions, while tienditas receive more targeted and relevant ads. Chiper Ads is now the leading B2B retail media network in Latin America. 

Chiper's innovative approach to modernizing the tienditas industry aligns perfectly with FEMSA Ventures' investment philosophy. By providing an end-to-end solution that tackles the challenges faced by tienditas store owners and establishes strong connections with CPGs, Chiper is poised for significant growth. FEMSA Ventures' investment in Chiper not only supports the company's expansion but also opens the door to collaboration and value creation across KOF's operations.  

We are thrilled to be joining Chiper in their journey to disrupt and innovate the tienditas market!