General Atlantic Leads $152 Million Series B for Mexico’s Justo

Bloomberg — Mexican startup Justo, an online supermarket that advertises locally sourced products, concluded a $152 million funding round led by General Atlantic to improve its technology as it looks to expand into new Latin American markets.

The Series B round will go toward technology investment to reduce losses from oversupply, among other improvements, Ricardo Weder, Justo’s chief executive officer and founder, said in an interview.

The company, which is currently operating in Mexico, Brazil and Peru, is looking to expand into Colombia and Chile. Justo has raised more than $250 million since it started operations in 2019, Weder said. It’s part of a startup industry in Latin America that has skyrocketed over the past year as venture funds pour money into the region.

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The money raised “reinforces investor confidence in us and helps to strengthen our expansion,” Weder said, declining to provide a valuation for Justo. Its sales jumped 500% overall in 2021 from the previous year, he said.

The company, which made its first acquisition in Peru last year, plans to open its first brick and mortar store under the Freshmart brand in Lima as soon as this week. “This is an experiment we are doing with our Freshmart partners but it isn’t something that we plan on doing short term in Mexico and Brazil because we still have to do a lot there with our online offer,” Weder said.

Weder said there could be some merger or acquisition opportunities in Mexico this year, adding there are “several ongoing conversations.” The U.S. market remains a possible long-term target for Justo, particularly in cities with high concentration of Hispanics. But for now, it will remain Latin America-focused. “There is a big opportunity there but we have to mature what we already have.”

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As inflation quickens the company has managed to keep its prices competitive with giant retailers like Walmart Inc. by working with local suppliers on models to better manage price increases, he said. Justo has over 2,000 employees in Latin America.

Women make up 40% of the workforce and half of them are in management positions, Weder said.

Tarsadia Capital, Citius, Arago Capital, Foundation Capital and Quiet Capital also participated in the Series B round. Last year, Justo raised $65 million in a Series A round.

--With assistance from Paola Vega Torre