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  • Social commerce startup Elenas raises $20 million to help more LatAm women sell online • australiabusinessblog.com

Social commerce startup Elenas raises $20 million to help more LatAm women sell online • australiabusinessblog.com

Elena estimates that 11 million women in Latin America sell consumer goods through catalogs and door-to-door sales methods. It digitizes that process so they can more easily sell from home.

Founder and CEO Zach Oschin started the Colombia-based social commerce company in 2018 (and joined our Latin America Startup Battlefield that year) to bring the traditional independent sales process online.

Here’s how it works: Entrepreneurs can browse a portfolio of hundreds of thousands of wholesale beauty, personal care, homeware and electronics products, decide what to sell, how much to raise the price, and then post the products on social channels like WhatsApp and Facebook .

Elenas also takes care of the sourcing, delivery and collection of the products. In the past year, more than 100,000 women in Colombia and Mexico have sold more than 2 million orders and made millions of dollars on the platform.

To speed up that trajectory, Elenas . raised $2 million in seed financing in 2020 and another $6 million in Series A capital in 2021. Now the company is back with an even bigger Series B round of $20 million. This gives the company more than $28 million in total funding to date.

While Oschin didn’t go into detail about Elenas’ valuation, he did say it was an increase from the previous round. He also said the company’s sales grew more than 5x between rounds.

DILA Capital will lead this new investment and will be joined by FJ Labs, Endeavor Catalyst, the Inter-American Development Bank’s IDB Lab, Broadhaven Ventures, Mercado Libre, Grupo Bolivar and Leo Capital.

“Elenas is revolutionizing the direct selling industry by empowering millions of people across the region to sell thousands of products through their digital catalog,” said Alejandro Diez Barroso, managing partner at DILA Capital, in a written statement. “We are confident that we are supporting the right team in the right market at the right time.”

As a country with three times the population of Colombia, Mexico is poised to become the company’s largest market next year, and it has already “achieved a profitable and sustainable growth model there,” Oschin said.

Since Elenas started there in 2021, Elenas has been able to scale 30%, meaning Mexico accounted for more than a third of its operations in just one year, which he says took two and a half years to reach in Colombia.

This is while other ecommerce companies have not fared so well, Oschin said. For example, he notes that some companies have been unable to achieve the right margin profile or build infrastructure to the level needed to become profitable by starting with lower-ticket items, such as grocery delivery.

“There was a huge boom in social commerce companies that were heavily funded in 2021, but that also meant the emergence of social commerce models that were very unprofitable,” Oschin added. “Some are reaching unicorn status, and we’re now seeing some of those models pull out, shut down, or lay off staff.”

He went on to explain that Elenas countered this trend by focusing on non-perishable items from the beginning, such as lifestyle products, homewares, fashion and accessories, which resulted in more healthy profit margins and higher ticket prices.

Not having to build your own infrastructure was another way. That model allowed the company to scale in Colombia and Mexico and deliver to 600 cities, including rural areas where that had not been achieved before.

In addition to 5x higher sales between the Series A and Series B rounds, the company more than doubled its workforce to 230 people.

Subsequently, Elenas will continue to expand its merchant network in both markets with a focus on scaling significantly in the coming year so that it can invest in better products and experiences for both merchants and providers.

It will also put some capital into the engineering and product to build out additional core functions, for example, merchant business management tools such as customer relationship management, product recommendations, and financial services.

“We want to expand into financial services that power their businesses,” Oschin said. “Fifty percent of our salespeople have never had a bank account, so this is a population with too few banks, and when running a business it’s important to have financial services. Our partnership with Grupo Bolivar will work towards that.”

Shreya has been with australiabusinessblog.com for 3 years, writing copy for client websites, blog posts, EDMs and other mediums to engage readers and encourage action. By collaborating with clients, our SEO manager and the wider australiabusinessblog.com, Shreya seeks to understand an audience before creating memorable, persuasive copy.

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