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GAIA Design raised $50 million earlier this month in a Series C round, the largest investment it has had so far, according to Crunchbase. The Mexican e-commerce company now has a total $80.9 million in funding, according to the same platform.
The latest round was led by SoftBank Latin America Fund I, the Japanese investment conglomerate that a few days ago announced a further $3 billion investment in the region.
What’s next for the furniture and design company in Mexico? Phillippe Cahuzac, co-founder of GAIA Design told Contxto:
Contxto: Can you tell us how GAIA was created and the market opportunity it is tapping into?
Phillippe Cahuzac: GAIA was born in 2014 with the idea of being a digital leader in the housewares category in Mexico. We saw that there was a segment that was not being served, and GAIA stepped forward as a solution.
We realized that the category had a historically broken experience with the consumer in terms of product offering and service. We could solve both.
Currently, we see that there is an opportunity in both the brick-and-mortar and digital space, where we have to continue positioning ourselves and sustain our leadership.
P.C.: Why did GAIA became an omnichannel company?
Our DNA is digital. It is still our main sales channel, but from day one we had an omnichannel vision. We want to build outlets that complement each other. Having these touchpoints, online and offline, generate a more tangible experience (for consumers).
C: What’s next for GAIA after raising $50 million?
P.C.: It is a very strong turning point for the company. In a single round, we managed to raise $50 million. We are more ambitious than ever in this sector, where we want to become the leader.
There is a very strong opportunity for scaling and accelerating GAIA’s sales going forward. There will be a solid growth strategy focused on Mexico, which includes expanding the catalog, scaling the logistics infrastructure to have the best costs and delivery time in the market, and expanding storage capacity. In Mexico alone, we are expanding from 20,000 to 40,000 square meters.
Another very strong element of growth is the launch of the marketplace at the end of this year. This will allow us to enter a larger market in terms of categories and price ranges.
Without a doubt, we want to double the size of the business in the next few years.
C: What valuation did GAIA achieve after this last investment round?
P.C.: We were able to multiply the valuation levels four times, compared to the last series B round. I can’t share the exact number, but it’s over $100 million.
C: What does it mean to you that a fund like SoftBank has invested in the company?
P.C.: We are excited because the people at SoftBank know the e-commerce sector very well and have invested in home living. They are the ideal partner to make a change in scalability.
They have a good understanding of the growth stage we are in. They are going to contribute a lot to multiply the size of the business in the coming years. SoftBank is the ideal partner to create a winner (in the market), not only in Mexico but also internationally.
C: Are your goals to expand beyond Mexico? If so, how soon?
P.C.: Yes, we are. We still have a lot to do in Mexico in the next 18 months. After that, it may be a good time to open our first store in a Spanish-speaking Latin American country.
We have these ambitions and we already have an investor who can help us with the expansion; however, we still have work to do in Mexico.
C: Where do you see the future of the furniture/home goods industry?
P.C.: I think there is going to be a lot of mutation in the next few years, where I see players that are going to consolidate.
I think I will see fewer players in the offline sector, but more consolidated players that continue with a much stronger value proposition. And, the online channel will be gaining more and more market share, annually.