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Rappi

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Rappi
Company typePrivately held company
Industry
  • Transportation,
  • On-demand delivery (e-commerce)
Founded2015; 9 years ago (2015)
HeadquartersBogotá, Colombia
Area served
List
    • Colombia
    • Argentina
    • Brazil
    • Chile
    • Costa Rica
    • Ecuador
    • Mexico
    • Peru
    • Uruguay
ProductsMobile app
Services
RevenueUS$ 220 million (October 2018)[1]
Number of employees
1,500 employees (October 2018)
25,000 delivery persons (October 2018)[2] c.20.000 couriers (October 2018)
Websiterappi.com

Rappi is a Colombian multivertical company headquartered in Bogotá, Colombia, and with main offices in São Paulo and Mexico City. It was founded in 2015 by Simón Borrero, Sebastian Mejía and Felipe Villamarin and today is present in 9 countries (Colombia, Mexico, Costa Rica, Peru, Ecuador, Chile, Argentina, Uruguay and Brazil) and more than 200 cities.

Rappi has been defined as the Latin American SuperApp and one of the fastest growing companies in the region. Its founders were included in the Bloomberg 50 list in 2019, recognizing them as entrepreneurs and leaders who have changed the global business landscape in measurable ways in the last year.

Description

Rappi's defining characteristics is the broad range of products and services available for delivery. The mobile app lets users order groceries, food or drugstore medications, but also send money (cash) to someone, or have a courier withdraw money from their bank account from an ATM and get it delivered to them, also, the couriers can offer transport personal belongings (such as house keys, wallets, purses and more). Couriers even walk customers' dogs.

Its UI has evolved from a supermarket shelve, to a less skeuomorphic interface, following the global trend. Depending on the country, customers can pay in cash or via debit and credit cards. Its platform incorporates Grability, an e-commerce platform used by other retailers such as Walmart, El Corte Inglés and Cencosud.[3] Customer reviews are largely negative due to lack of customer support.[4]

Verticals

Restaurants

It is the company's strongest delivery vertical and they have a variety of options including vegetarian and specialized restaurants, and large chains, among others.  It has world-class allies in each of the markets where it is present recently launched its haute cuisine service where renowned chefs join the delivery

Supermarkets and Convenience Stores

It is the vertical that showed more growth globally during COVID. They have large supermarket chains and in Colombia they have the exclusivity of Grupo Éxito. The largest in the country. For large purchases they have fleets of carts that are suitable for moving large volumes and have the option of shoppers within the supermarkets that are responsible for selecting the products.

RappiMall

It is a relatively new vertical within the application, where users can find a wide range of products and consumer goods of all types of brands with international recognition. Fashion, accessories, beauty, sports, toys and household items are just some of the divisions in this category.

Rappi Entertainment

In June 2020 and during the peak of the COVID-19 pandemic in Latin American countries, Rappi announced in a live event within the application, in simultaneous for 9 countries, that from that moment on, live events could be held in the application as well as announcing the creation of 3 additional divisions in this category such as games, live sales and music.[5]

With this announcement Rappi consolidated its goal of becoming the first SuperApp in the continent by expanding its offerings to compete with other big names in the world of entertainment and as Spotify.

Background

Rappi was founded in 2015 by Felipe Villamarin, Sebastián Mejía, and Simón Borrero, three Colombian entrepreneurs. The initial investment in Rappi was $2,000,000 (equivalent to $2,160,958.92 as of 2019[6]). According to Mejía, Rappi's customers can "order almost anything they want with a super app concept that will deliver it to them in 30 minutes in exchange for a buck." The company generates revenue by taking an average of 17% from each retail transaction.[1]

Later, Rappi entered Y-Combinator's Winter 2016 batch, generating additional investment.[7][8] In August 2018, the company raised another $200 million in funding.[9] SoftBank became a major stakeholder in Rappi in April 2019 with a $1 billion dollar investment.[10]

In October 2018, some delivery people of Rappi took to the streets. The company has been criticized for its working conditions, from the employees side and for a lack of customer care from their clientele.[11][12][13] Rappi has allegedly failed to follow regulations regarding customer support and faces possible fines from government regulators.[14] The [Colombian] Superintendency of Industry and Commerce has formulated an investigation against Rappi S.A.S. "Not having a complaints channel for their customers, the fact that there is still confusion in the terms and conditions ... the final price for the consumer still being unknown and variable, the fact they are still not giving full attention to the complaints ... calls our attention," Superintendency head Andres Barreto told journalists.[15]

In January 2019, Rappi signed a partnership with Avon Products to distribute the company's beauty and personal care products through its platform.[16] That month, due to the Tlahuelilpan pipeline explosion and following gas shortage in Mexico, many users turned to Rappi to order gas delivered to their house, but the company had to remind them that this process was illegal.[17]

In February 2019, Simon Borrero was awarded the "Empresario del año" (Businessman of the year) award from the Colombian President for helping transform society.[18] Simon Borrero and Rappi et al are currently being sued in U.S. federal court for misappropriation of trade secrets.

As of August 2020, Rappi had more than 200,000 independent couriers actively connecting to the app in Latin America, and worked along with over 250,000 different businesses including groceries shops, pharmacies, kiosks, and office supply stores.[1]

In 2019, Rappi partnered with Visa Inc to offer prepaid cards in Mexico, Colombia and Brazil, together with a QR-Code based digital wallet called RappiPay. Rappi's Country Manager in Brazil said it was the first of many financial services the company planned to expand beyond delivery.[19] In June 2020 Rappi announced a partnership in Mexico with Banorte to revolutionalize digital banking services.[20]

The success of the company has been boosted by the Venezuelan refugee crisis,[21] with more than 1.3 million Venezuelans having fled to Colombia as of July 2019.[21] As many new migrants struggle to find regular jobs, apps like Rappi allow a quick access to a first moderate revenue.[21]

References

  1. ^ a b c "Colombian 'Super App' Is a Unicorn. It Wants to Be a Tech Giant". Bloomberg.com.
  2. ^ Boris Miranda, Rappi, el "Amazon de Colombia" que se convirtió en el emprendimiento más exitoso del país (y que genera protestas en algunas ciudades de América Latina) (in Spanish), Bbc.com, 26 October 2018
  3. ^ "Grability homepage". Retrieved 1 March 2020.
  4. ^ "Positive &Negative Reviews: Rappi". AppGrooves. Retrieved 1 March 2020.
  5. ^ "Latin American Delivery App Rappi Launches Livestream Offer With Manuel Medrano". Billboard. Retrieved 18 November 2020.
  6. ^ "$2,000,000 in 2015 → 2019 | Inflation Calculator". www.in2013dollars.com.
  7. ^ "Rappi, la revolución del e-commerce viene de Colombia". Forbes. 17 April 2017.
  8. ^ Kokalitcheva, Kia (8 November 2016). "Colombian Startup Rappi Wants to Deliver 'Everything'". Forbes.
  9. ^ José Orozco, Rappi se convierte en “unicornio” gracias a una nueva ronda de financiamiento (in Spanish), Developerz.software, 7 September 2018
  10. ^ "Rappi Raises Up to $1 Billion from SoftBank Group Corp. and SoftBank Vision Fund". Business Wire. 30 April 2019. Retrieved 1 March 2020.
  11. ^ ¿Por qué protestan los trabajadores de Rappi? (in Spanish), Wradio.com.co, 20 October 2018
  12. ^ Testimonios que explican la protesta de los 'rappitenderos' en Bogotá (in Spanish), Semana.com, 20 October 2018
  13. ^ El infierno de trabajar en Rappi (in Spanish), Las2orillas.co, 15 October 2018
  14. ^ Cobb, Julia Symmes (13 November 2019). "Rappi failed to comply with regulatory orders, Colombia says". Reuters. Retrieved 1 March 2020.
  15. ^ Editorial, Reuters. "Business & Financial News, U.S & International Breaking News | Reuters". U.S. Retrieved 4 March 2020. {{cite web}}: |first= has generic name (help)
  16. ^ Colombia: Avon se alía con Rappi para trabajar en Brasil y Colombia (in Spanish), American-retail.com, 15 January 2019
  17. ^ Rappi se enfrenta a usuarios que piden gasolina desde la app en México (in Spanish), Fayerwayer.com, January 2019
  18. ^ "En la distinción a los fundadores de Rappi como 'Empresario del Año 2018', del diario La República, el Presidente elogió el poder del emprendimiento de los jóvenes". id.presidencia.gov.co.
  19. ^ "Delivery startup Rappi partners with Visa to offer pre-paid cards in Brazil". Reuters. 19 June 2019. Retrieved 20 October 2019.
  20. ^ https://www.banorte.com/wps/portal/gfb/Home/noticias-banorte/noticias-2020/rappi
  21. ^ a b c Rueda, Manuel (29 July 2019). "Venezuela migrants propel billion-dollar delivery app". AP NEWS. Retrieved 29 July 2019.
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