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Contxto – Brazilian motorcycle delivery as a service, Mottu, raised a pre-Series A round worth US$2 million this month. The investors were Allievo Capital, Caravela Capital, Fundação Estudar, and angels.
The news was kept under wraps until now.
Contxto got in touch with Allievo Capital co-Founders, Guilherme Queiroz and Matheus Baldi, to discuss the nature of such a funding round. One which makes sense on paper, due to the need to rethink delivery and mobility in the age of Covid-19.
But also, a solution that seems to square the impossible circle of the logistics/mobility rental market that so many companies have failed to perfect.
Mottu, solving the mobility paradox
“It is much more convenient to rent a motorcycle than to own one”, Queiroz said to Contxto. Unfortunately, that’s a fact that also seems to have applied to those who have tried to do the renting.
The pain has been all too real for companies specialized in logistics and micro-mobility.
We’ve actually written a whole deep dive in an effort to understand why mobility startups have it so hard. And why so many, like Mexican-Brazilian Grow Mobility, simply cannot stay afloat.
However, Mottu seems to see deliverance in its own slogan: “Delivering for the deliverers.”
Mottu is a motorcycle as a service company. Thus, it aims to become the biggest Brazilian motorcycle operator. How? By not limiting themselves to renting out vehicles to any individuals, but rather by focusing on a tried, tested, and growing market.
The key to success, according to Mottu, is to act as an outsourcing platform for companies that already need logistical services. But not directly, rather they rent motorcycles to couriers (autonomous workers) who perform delivery services for delivery companies.
They reckon that the couriers for companies like Rappi, iVoy, Picap, or Hugo (and the companies themselves) will see the benefits of having a flexible fleet. One for which they do not have to pay maintenance expenditures nor insurance bills.
Meanwhile, Mottu can finally do what mobility companies have so often failed at: Play with economies of scale and get the unit economics of their bikes to work in their favor.
But, it is still testing the waters in other verticals, since, according to Queiroz this MaaS (Mobility as a Service) wants to offer its services to “(i) delivery operators, (ii) enterprises, (iii) individuals, and (iv) tech services.”
Mottu by the numbers
Mottu had a pre-money valuation of US$15 million. Prior to this round, the company’s cap table was composed of Brazilian tycoons; angels who have not been diluted so far.
Now, at a valuation of US$17 million and with some extra cash shaking in its pockets, the company will acquire 2,000 motorcycles from Honda and “will further develop its technology and marketing divisions.”
The key will be to reach the 100,000 motorcycle-mark and to make an annual revenue of US$200 million within five years.
The investors and Rubens Zanelatto, Mottu’s Founder and CEO, are currently holding a company with over 300 rented motorcycles and an app that has been downloaded by over 40,000 prospective clients. Their work, and their conversion rate from downloader to full-fledged user, is cut out for them.
A couple of million dollars no doubt will do the trick. Indeed, Mottu expects to be profitable before its series A round.