Cubbo: Making money faster than we can spend it

Sharing our latest shareholder letter, which we sent to investors this morning

Brian York
3 min readJan 31, 2024

Dear Cubbo investor — we hope you’re well. In this update, we’re happy to share the latest company news.

  1. Now that December’s numbers are final, we confirm that our gross revenue for 2023 was $8.7MM. Our year-over-year growth was 122%. We’re projecting to reach $23MM in revenue this year and $3.5MM in EBITDA at the consolidated level.
  2. December’s gross revenue reached $1.1MM, which was a 77% increase vs Dec 2022.
  3. December’s EBITDA at a consolidated level was +$11,868. The full year 2023 consolidated EBITDA reached +$193,599.
  4. We’re expecting a flat Q1 2024 vs. Q4 2023, but we see this as a sign of strength given November’s seasonality — we will be able to maintain the total number of orders this quarter vs. the orders seen throughout eCommerce holidays.
  5. Brazil’s customer diversification contributed to a +$0.3 increase in the average revenue per order, reflecting a +6% growth. This resulted in Cubbo achieving a $6.9 revenue per order in December. We aim to achieve a higher average revenue per order in 2024 through Importer of Record and Merchant of Record strategies.

Money Flow Insights

In 2023, we achieved a negative CCC several times and are now on the brink of reentering this state indefinitely.
  1. We’ve consistently maintained a healthy Cash Conversion Cycle (CCC), which is a reflection of how fast we get paid by customers relative to our cost of sales cash flows.
  2. Last year we achieved a negative CCC a couple of times, and by April 2024 we believe we will enter — and then maintain indefinitely — negative CCC. A negative CCC means that we’re making money faster than we can spend it. This is a sign of strong financial management and efficiency because it means we can use this cash for other investments or operations.
  3. Our Days Sales Outstanding (DSO) in 2023 was 30.6, which is -12% lower in 2022. DSO represents how long it takes us to get paid by customers after we’ve provided an eCommerce fulfillment service.

A Close Look at Our Profit & Loss Statement

A P&L comparison 2022 vs. 2023

* results in thousands

FX rate adjustment in 2023, generated over $300K in non-operating revenue. For financial reporting purposes, we adjust FX once a year.

  1. An increase in both orders and revenue on the top line resulted in a positive EBITDA for 2023, leveraging the benefits of economies of scale to dilute costs.
  2. Importer of Record and Merchant of Record services are cost-effective strategies for Cubbo. They play crucial roles in revenue enhancement, both in total revenue and revenue per order. Our 2024 target is to reach +$1MM using these strategies collectively. These strategies are used to help international brands launch into Latin America without having to create a local subsidiary or open a local bank account.
  3. The positive Net Income result stems from effective working capital management, prudent control of capital expenditures, and strong unit economics. These consistently drive positive EBITDA outcomes.

The conclusion of 2023 reveals a successful year that surpassed expectations. Consequently, we have set forth an ambitious yet realistic forecast for 2024, always mindful of our audacious aspiration: to build the largest eCommerce fulfillment network in Latin America.

Please feel free to reach out with any questions or for additional information. We highly value your engagement and feedback.

Cubbo co-founders Josu, Ignasi, and Brian