20VC: Rappi Founder Simón Borrero on Growth vs Profitability, Capital Efficiency, Raising $1.7Bn as a LATAM Company and Why Uber Eats Did More To Help Than To Hurt Rappi
The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
The Twenty Minute VC
4.4 • 637 Ratings
🗓️ 18 March 2021
⏱️ 31 minutes
🧾️ Download transcript
Summary
Simón Borrero is the Founder & CEO @ Rappi, the startup that has become a cornerstone of the Latin American mobile ecosystem, coined as "the next Everything Store of Latin America". To date, Simon has raised over $1.7Bn for the company from the likes of Sequoia Capital, a16z, Softbank, DST Global, Y Combinator and more. Prior to Rappi, Simon was the founder of multiple former companies including Imaginamos, a software studio he grew to over 300 people.
In Today’s Episode You Will Learn:
1.) How Simon made his way into the world of startups and came to found "the next Everything Store of Latin America" in Rappi?
2.) How does Simon think about the importance of zone density for a business like Rappi? What are the number of deliveries required for Rappi to make for the business to be breakeven? What is the key metric that determines the success of the business for Rappi today?
3.) How does Simon approach the balance of capital efficiency vs growth? How does one know when to pour fuel on the fire and go for growth? When is the right time to really focus on unit economics? Why does Simon believe expanding Rappi can be analogised to scaling a coffee shop?
4.) Rappi has now raised $1.7Bn from some of the best investors in the world, what does Simon believe Rappi did to enable them to be so successful fundraising? Was it a difficult shift for Simon to make moving from lean to capital abundance with the successful fundraises? What changed? How did Simon change as a leader? What is the story of Sequoia coming in?
5.) Customer acquisition: What were some of the biggest challenges when it came to initial customer acquisition for Rappi? What does Simon mean when he says "donuts for downloads"? What is the story there?
6.) Driver acquisition: In the UK and the US, driver acquisition is a big challenge, what did Rappi to do enable them to scale their driver supply so efficiently? What works? What does not work?
7.) Restaurant acquisition: What were the hardest elements of onboarding the first restaurants? How did Uber Eats entering the market actually make Rappi so much more efficient as a business and service?
Item’s Mentioned In Today’s Episode
Simon’s Favourite Book: The Prosperity Paradox
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Transcript
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| 0:00.0 | We are back. This is 20 BC with me, Harry Stebbings, and I cannot believe it, but it's been five years of 20 BC, |
| 0:05.6 | and we finally have our first guest on the show from Latam, and I could not have asked for a better first guest. |
| 0:10.4 | And so with that, I'm thrilled to welcome Simon Barrero, founder and CEO at Rappi to the hot seat today. |
| 0:15.4 | Now, as for Rappi, Rappi is the startup that has become a cornerstone of the Latin American mobile ecosystem, |
| 0:21.1 | coined as the next everything store of Latin America, |
| 0:23.8 | and to date, Simon has raised over $1.7 billion for the company, |
| 0:27.5 | from the lights of Sequoia Capital, Andreson Horrors, SoftBank, DST, Y Combinator Continuity Fund, and more. |
| 0:34.1 | Prior to Rappi, though, Simon was also the founder of multiple former companies, |
| 0:37.6 | including Imagineamos, a software studio who grew to over 300 people. And I do also have to say a |
| 0:42.5 | huge thank you to Anu at YC Continuity Fund for the intro and some fantastic questions suggestions |
| 0:47.5 | today. I really do so appreciate it, Anu, and the show wouldn't have happened without you. |
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