Meet the C-Suite
Santiago Pineda, CEO Mensajeros Urbanos
“Delivery has become a part of our culture”
The Colombian last-mile technology firm is earning market share in Mexico and has plans to expand its business to more Latin American countries. The key to its success lies in its dedication to the customer and the advantages provided by the platform economy.
By SIMALCO Brandlink
Santiago Pineda – a 34-year-old economist from the Universidad de Los Andes – had been passionate about the Internet since his school days. He was sure that by using this new platform´s potential, he could develop a business. So, it was that in his last year of university he founded, together with his brother Juan Pablo, a marketplace for the sale of flowers for the Colombian domestic market, at a time when the exchange rate did not favor exports.
After that venture, both brothers ventured with a firm focused on investments in Latin American capital markets, for which they created a stock market simulator. That project took them to live in Chile for a year, being part of the first generation of Startup Chile.
How did you end up with Mensajeros Urbanos?
One of the investors in the stock market initiative, in 2015, contacted us with Rafael Socarras and Juan David Vizcaya, who created the startup in 2013. Since they had a hard time scaling the business during the first two years, they offered to join us to support them and boost their growth. And we joined because we saw a great potential in everything that had to do with the boom that was taking place in home delivery and food delivery, pharmacies, supermarkets, in the region. When we arrived, the company was very small, selling around US$ 10,000 dollars a month. Today we have a turnover of around US$ 2.7 million per month and, in a certain sense, we consider ourselves to be founders, just like Rafa and Juan.
What decisions did you take that made the company grow so much?
We focused on looking for corporate clients, rather than individuals, and that helped us a lot. At that time there was Rappi, which was well financed and growing very fast in the restaurant sector with individuals, and we did not have that financial muscle, so we said ‘if we go that way, we will surely lose, let’s focus on the corporate side to provide a logistics solution to restaurants, pharmacies, supermarkets, so that they can compete, in a way, with these marketplaces and can strengthen their own delivery channels’.
And I believe that this was the right strategy, which allowed us to grow at an accelerated pace.
So the focus of Mensajeros Urbanos is more B2B, meaning, for companies.
That’s right, we do logistics management, we only focus on that, because in that boom that Rappi was generating, it happened that the same brands, despite working with these marketplaces, were afraid of losing their own channels and stopping their direct sales. Many of them were also interested in strengthening their service and delivery times. And they found in Mensajeros Urbanos an ally that allowed them to achieve all that, instead of having it within the company. Then we opened home delivery for pharmacies, supermarkets and restaurants, which made us grow a lot. And then we opened new business units, focused more on e-commerce issues, on mass consumption issues for the supply of products to neighborhood stores, or to large supermarkets.
This is how we can do almost any type of last-mile shipment, depending on our customer’s requirements.
What has it been like to grow tenfold? There must have been a lot of investment in human talent, in sales force?
Well, part of the growth was because, I think, we found that niche or segment and we were the first and we were able to innovate month after month to continue providing a very good service for our customers, which allowed us to position ourselves in the market as the number one player in Colombia. But that was accompanied by the investment made by Movile, a Brazilian fund that allowed us to strengthen our technology teams and our sales teams, to be much more aggressive in customer acquisition, and that was precisely what allowed us to grow and get to where we are today.
How much have you grown today in terms of customers and drivers?
We have 25,000 active clients between Colombia and Mexico, and close to 60,000 drivers available on the platform, whether with a bicycle, a motorcycle, a private car, a van or a truck, we have multiple vehicles.
Are the drivers exclusive to Mensajeros Urbanos or are they freelance?
Because this is an open platform, we do not have any investment in vehicles, everything is according to the gig economy model. And I think we have been able to generate loyalty in a certain way towards the brand from the drivers, however, they have total freedom to be taking orders with other platforms, and in that we are also very careful, because we faithfully believe in the model and we apply it “to the T”, in the sense that drivers are independent and have absolute freedom. We are very careful about that, and we are faithful to the model and to the freedom that the model gives to the drivers as well.
You are also very concerned about being sustainable with your emissions and that is why you have a fleet with a high green percentage and you also offset C02 emissions, how is that?
We have three pillars of sustainability: one is environmental, the other is financial and the other is social. Our mission and vision is to be a company that lasts over time, we are not here to sell it, but the long-term objective is to create value and, although we want to be financially sustainable to be able to last over time, it does us no good if by doing so we are damaging our environment. We want to create a company that allows the families and people who have contact with the company to progress, and we also see this as a very important pillar within the company.
SIMILAR CULTURES
How was the arrival of Mensajeros Urbanos in Mexico and how was it enhanced by the recent acquisition in July of Zubut?
We opened operations in Mexico, in 2019, together with one of our main clients in Colombia, which are the main convenience stores in the country. Today, we have grown with more brands very well. This year, with the objective of accelerating that growth and strengthening the growth of the Mexican market, we acquired Zubut.
And how has the experience been so far? It was important for you because of the knowledge you had of the local market, and that there could be a synergy to strengthen the business?
Yes, part of the objective was precisely to bring two wonderful entrepreneurs who have a very good knowledge of the country and a technological team and technology that we value very much. The goal was to affect Zubut’s clients as little as possible, so the plan of action has been gradual, and little by little we have been migrating certain functionalities to Mensajeros Urbanos.
What are the particularities of Mexico and Colombia, are they similar or different markets?
The two countries share a very similar cultural theme, which makes things much simpler, because in the end you don’t have to change many things. But there is one particularity, and that is that the experience of the Colombian market, which is much more advanced in terms of delivery, since the Colombian culture for many years has been a culture of ordering many things at home, but not so much in Mexico. So, in Mexico we feel that we are at the right moment, because it is the same moment we experienced in Colombia, seven or six years ago, when that culture began to change and began to digitize a lot. We see brands today with a very strong interest in strengthening their e-commerce channels, in strengthening their own sales channels. So, I think it is an ideal moment for us and I think we are riding the wave of this change in Mexico.
Thanks to the platforms, there is a boom in delivery, in the last mile, but also in the delivery profession. There is a kind of visibility in the street of people who used to be invisible before.
I totally agree. Colombia was a very particular country in the region, where the issue of home delivery was very strong, there is a very strong delivery culture, which, with the issues of platforms, was digitized through apps. But Mexico, Chile and other countries, [due to] marketplaces such as Rappi, Uber Eats, DidiFood, have changed that passivity in the request for home delivery and have made delivery become part of the culture of these countries, too. That is why I think it is also a very opportune moment for us, brands did not have their own delivery channels or they were not very strong, today they depend a lot on their marketplaces, which are a risk for them, and they are starting to look for alternatives to create their own sales channels, and they need a strategic ally in logistics to be able to have the same delivery levels, and that is where we play a fundamental role for them to achieve it.
I understand that Chile is the other country you would like to go to in the near future, isn’t it?
I have a huge appreciation for Chile, because I lived there for a year, my parents also lived for eight years in Santiago and I have many Chilean friends. But I also see it as a huge opportunity, because I see it just like Mexico: as a market that is growing a lot in terms of domiciles. We have clients both in Colombia and Mexico that have a relevant operation in Chile, and they have told us many times that they want us to open the Chilean market. My objective was to open it this year, however, due to everything that has been happening with the global investment situation in terms of entrepreneurship and the fact that we are no strangers to this situation, this year I believe it will not be possible and I hope to be able to resume this idea and this objective for next year.
CYBER SECURITY
How do you leverage your human resources and talent recruitment? Was there a change with the pandemic?
I think the pandemic was a catalyst to open our eyes and minds much more than we did before. We were much more about having our offices, but COVID helped us to understand that it was not so relevant and today we have teams in Silicon Valley, in Brazil, in different parts of the world. And that opened a door to access an impressive talent, to many other cultures that also generate a gigantic value for the company. For example, our person in charge of the entire technology and product area is an Indian who lives in Silicon Valley, who was the director of engineering at E-Bay, and one of the first engineers at Paypal… imagine the knowledge this person has and the knowledge he brings to the team. And not only him, we also have very good people in different areas of the company and I think that today the Mensajeros Urbanos team is a triple A team, which allows us to keep raising the bar to keep improving and continue to be a company that is always at the forefront and meeting the expectations of our customers.
In addition to the Brazilian investor, what other funding has Mensajeros Urbanos received?
Our last round of investment was the Series A, which we closed last year, but with all the situation that is happening in the world of entrepreneurship and technology, we want to raise our Series B next year.
How are you concerned about cybersecurity and identity verification issues?
That’s a challenge that all technology companies face on a day-to-day basis. We try to be constantly vigilant of these issues, we hire companies that do ethical hacks to our system to see where we have shortcomings. But it is a challenging issue, because these companies advance very fast in technological development and new functionalities that sometimes have some kind of security gaps, and if you are not also doing this kind of ethical hacking, then you can miss them, so it is a huge challenge and an additional challenge for the technology team to also be covering risk and reducing it to a minimum.
What technological or operational aspect differentiates Mensajeros Urbanos?
The big difference that Mensajeros Urbanos has is that we understand our business as a 100% operational business, where you seek to achieve shorter delivery times and a better operation for your customer, and all the technology we have developed has been focused on being hyper-efficient in the processes. This technology may not be very visible, but behind the scenes it has a gigantic impact on your business. That is why today our delivery times are under 35 minutes and the level of fraud is almost zero.
Could you also explore the issue of electronic payments?
Today it is part of our focus, because one of the big challenges you have in Latin America is that cash and cash on delivery is still the preferred method for all consumers. Even if you have a credit card, you prefer to have the terminal or POS delivered to your home to make the transaction, rather than put your card on the brand’s web page, because there is a great distrust due to cloning, for example. So, almost 70% of the deliveries we make are deliveries where the product is paid for at the time of delivery, and that generates some very big operational and logistical challenges. In this regard, part of the company’s focus has been to find an efficient technological solution to these payment methods.
Very soon we will be announcing a product that we will be launching for that purpose.
