Sourcing and importing goods from overseas can go very wrong, leaving companies in a position of not receiving what they paid for or even getting nothing.
Manuel Rodriguez Dao, co-founder and CEO of Mexico City-based Meru.com, and co-founder Federico Moscato, learned this the hard way when they were sourcing goods for another company and faced problems, among them getting the items that were originally offered.
In 2020, they joined with Eduardo Mata, Virgile Fiszman and Daniel Ferreyra to start Meru to help small and medium companies avoid the same fate. Today, the company announced $15 million in Series A funding. The round was co-led by Valor Capital and EMLES Ventures and included individual investments from a group of founders. To date, the company raised $17 million.
Meru’s technology includes a marketplace and app that connects local and foreign manufacturers to the rest of the supply chain with a simple process and no price asymmetries, initially working between China and Mexico. It is working directly with quality certified factories, Rodriguez Dao told TechCrunch.
The traditional way of sourcing can make small businesses lose up to two days a week navigating through the process, which often includes up to five intermediaries. On top of that, 80% of transactions result in fraud, on average, he said. In contrast, Meru customers can select and purchase products in minutes with a guarantee from the company that they will receive those products and at the best market prices, Rodriguez Dao added.
The company was part of Y Combinator’s winter batch in 2021, and the new funding will assist Meru to become a one-stop shop for small businesses with the ultimate goal of becoming the Alibaba of Latin America, Rodriguez Dao said.
“We began working remotely in China and learned that among global transactions, the same pain points are happening across emerging markets,” he added. “We want to make sourcing and procurement safe through technology-enabled distribution, similar to Alibaba, so we connect parties across the supply chain and get them access to discounted prices.”
Just a year in and Meru already has more than 10,000 registered users and operates seven product categories. It also has fintech partners to assist with financing. It went from six employees last August, when Meru launched its marketplace, to now 210 employees in both China and Mexico.
The company will deploy the new funding into adding new verticals and categories, technology development and scaling its team. It is growing 40% to 50% in revenue monthly.
“Meru is building an integrated B2B marketplace that allows Latin American SMEs to acquire much more efficiently from Asia, all through a single point of contact,” said Antoine Colaço, managing partner of Valor Capital Group, in a written statement. “By providing access to thousands of products, taking care of all logistics, billing and follow-up processes and incorporating financial solutions, Meru will help strengthen the links between the global supply chains of LatAm and Asia.”
Source: New feed