Contxto – Central America’s favorite home delivery service, Hugo App, is making headlines once again for new product offerings!

As it expands throughout Guatemala, the Salvadoran startup intends to add new products to its catalog, including “Mandaditos,” Hugo Cash, grocery delivery, event ticketing, and even insurance products.

Known as the “fastest-growing app of Central America,” Hugo App is certainly fortifying its Guatemalan operations, expecting to grow by 600 percent by the end of the year, compared to 2018. As of today, it offers services in Quetzaltenango, Xela and Guatemala City. 

Hugo App’s new products

Interestingly enough, the concept of copycats seems to be reaching new heights. While initially regional startups were replicating successful models from their American or European peers, now smaller Central American ones are mimicking what worked in larger Latin American countries. 

Keeping this in mind, not only is Hugo App reproducing Rappi’s delivery system, but its overall “super-app” concept, too.

In fact, quite similar to Rappi’s cash and “favores” features, Hugo’s new services includes “mandaditos,” meaning errands. With this, users can request company “hugos” (delivery personnel) to fulfill a variety of miscellaneous jobs. These can range from picking up forgotten keys to delivering a courier service.

More so, Hugo Cash allows users to request cash without needing to leave the office. Also, the new supermarket product delivery features enables shoppers to request convenience store products or groceries to be delivered home.

Furthermore, the company is venturing into new spaces. The new ticket feature works pretty similar to Eventbrite where users can ditch printed tickets for virtual QR codes.  

Lastly, due to an alliance with Mapfre, Hugo will now offer home and road assistance services. These will reportedly be available 24 hours a day, 365 days a year.

Goals!

Based on these new developments, Hugo App expects to grow around 600 percent by the end of 2019, compared to 2018. All the while, the company famous for its purple branding anticipates reaching more than 1 million users throughout the entire region, as well as signing up 2,000 additional “hugos”. 

“We aim to become the first Central American tech company to operate in the five continents,” according to Hugo App’s mission statement on its website. Upon observing its modus operandi, though, there’s no denying that the startup has a strong work ethic.

“The application offers employment to more than 130 people at the regional level and has 3,000‘ hugos’ registered, as distributors are known to add to the concept of collaborative economy, ” said the company in a statement.

The future of delivery

As I sarcastically joke in my tweet, the last-mile delivery industry is already a saturated market. Although there are clear big players, it’s still very fragmented in niche products and services. I believe this will change eventually. 

In my opinion, the unit economics will not be attractive enough to focus on niche segments of the delivery space. Instead, companies will need to embrace the “all-encompassing” delivery concept for them to sustain those high marketing and user acquisition costs, made popular Rappi. 

At the end of the day, execution is the only thing that will truly matter in this industry. After all, there are few legal protections and low economic barriers for entry.

With few obstacles impeding potential competitors from entering this market, we could say it is a highly commoditized industry. Nonetheless, discipline, talent and an execution mindset is what will set the winners apart.

Lastly, regarding Hugo App, shout out to our new Head of Growth, Hugo Beas. Welcome to the team!

-VC