In a significant development, SoftBank-backed used-car platform Kavak has become Mexico’s first ever tech “unicorn”. The startup was valued at $1.15 billion in its latest funding round last month, said its CEO Carlos Garcia.
Since its founding in 2016, Mexico City-based Kavak has raised more than $400 million in total funding with SoftBank, Greenoaks Capital and DST Global leading in its latest funding round, said Garcia in an interview.
Kavak is SoftBank’s latest Latin American investment which has become an unicorn. Other unicorns in its portfolio include delivery app Loggi and gym membership app Gympass, both of which are from Brazil; SoftBank also owns Colombian delivery app Rappi which is also a unicorn.
“It’s really humbling for us to be the first Mexican unicorn. It’s something really important for the ecosystem in Latin America, and especially Mexico,” said Garcia, 37.
He went on to add, Kavak is plan a launch in Brazil in early 2021.
Earlier this year in August, Kavak entered the Argentinian market through a merger with used-car platform Checkars.
Having built up the business in Mexico, Garcia now plans to scale it up in Brazil – Latin America’s biggest economy; he plans on hiring 500 people within a year. Currently Kavak employs 800 people in Mexico and Argentina. The workforce is likely to double next year, said Garcia.
Despite coronavirus-induced slowdown in the economy, traffic has recovered to pre-pandemic levels, said Garcia, with shoppers becoming more comfortable with e-commerce and seeking alternatives to public transportation.
“A route to do an IPO is in our plans… probably in the next two to three years we’d think about doing that,” said Garcia.