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Mexican startup Nelo is the latest “buy now pay later” company to raise capital in Latin America.
Nelo announced a $ 20 million Series A round led by Two Sigma Ventures with participation from Homebrew, Susa Ventures, and Crossbeam. With this new investment, it has received total funding of $25.6 million.
The company was created in 2019 by former Uber executives. CEO and co-founder Kyle Miller informed TechCrunch that Nelo is growing 50% in sales and conducting more than 100,000 new transactions per month.
Through its mobile app, Nelo users can make purchases in monthly installments on sites like Ben & Frank, Amazon, and Netflix.
With this new financing round, the startup seeks to expand in Mexico, a country that is currently experiencing consistent growth in e-commerce.
BNPL boosts e-commerce growth in the region
BNPL is a solution that allows online buyers to make purchases and pay them in interest-free monthly installments. The only required payment is a monthly minimum. However, it does charge fees for late or missed payments.
This model has been gaining traction recently: As of mid-2020, the number of BNPL companies has grown 197% year-on-year, according to Cardify.
In addition to Nelo, other BNPL Latin American startups that have recently received investment are Atratto and Addi.
In early September, Mexican startup Atrato obtained a debt of $15 million in a round led by Architect Capital, just three months after $2.7 million. Accel, Y Combinator, and Harvard Management Company participated in this early round, according to Crunchbase.
Meanwhile, Colombian company Atrato raised an additional $75 million in its Series B. led by New York-based Greycroft.