A record-breaking number of orders!
Cubbo started business in January and this is the 5th (May) investor update.
Dear Cubbo investors and supporters,
We are happy to provide our fifth update and report that we have achieved a new record in the number of orders we fulfilled in one month! Please find below the May 2021 update:
We grew 50%+ month-over-month in the number of e-commerce orders we fulfilled. The increase was driven mostly by the Hot Sale in Mexico. We project to be cash flow positive for the company (including HQ expenses) when we reach 30k orders per month — and we are projecting to achieve this milestone this year.
May was our first full month of being completely moved into the new urban distribution center in Mexico City and having our founding team working together (post vaccination) under the same roof. In the previous months, we were repurposing the urban real estate space and the leadership team was working in different countries.
Human resources
We added two full stack engineers to the developer team (the dev team is now 4): Nancy Noemi Franco and Edoardo Montesi. Not only do both of the new hires have good experience with front and backend development, but Noemi also has extensive experience building products for logistics companies, and Edoardo has deep experience in robotics software design and implementation — super relevant skills to have for where Cubbo is today and will be in the future.
Did you know?
In most cases, our fulfillment prices are materially cheaper than our competitors’, but we’re still able to maintain a healthy margin because of our niche focus — we do only non-perishable e-commerce D2C, small items with high SKU rotation — and because we optimize warehouse space and overall fulfillment services through our tech. Here’s how our gross margins look across our largest customers:
Lesson learned
Onboarding new customers is taking longer than expected. Out of the five customers we closed in April, we received inventory from only one in May. The reason for each was because the new customer didn’t want to relocate all their D2C inventory from one warehouse to another right before Hot Sale, but we are taking this as a lesson learned and an opportunity to recruit a new hire who will focus on onboarding new customers, which includes managing the reception of the new inventory as quickly as possible and also onboarding our new customers onto our e-commerce fulfillment platform.
What to expect in June
We’re expecting flat growth in June. We will be starting with a few new customers, which will compensate for the slow down post Hot Sale, but net-net the revenue should roughly be the same. We do have a couple of large retailers we are finalizing negotiations with, which will bring 2–3x total revenue (each), but we expect those deals to close in the following months.
Fundraising
We raised an additional ~$500k in May. We now have over 80 investors, comprising mostly other founders from LatAm and the U.S. Moreover, a good portion of these founders are from venture-backed direct-to-consumer brands and e-commerce related companies, which has materially helped us advance the business. We’ll continue to raise from investors with similar characteristics for the next few months.
How can you help?
Please introduce us to a real estate development company or logistics real estate company in São Paulo. We’re looking for urban real estate to repurpose and to launch operations in Brazil later this year.
Please let us know if you have any questions — and thank you for your support!
—
Brian and Josu, co-founders of Cubbo
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