The whole on-demand space has faced a lot of scrutiny in the past few years as questions about whether they are viable businesses balloon and the periodic..<\/b>
\nThe whole on-demand space has faced a lot of scrutiny in the past few years as questions about whether they are viable businesses balloon and the periodic down round leaks out. Then Instacart raised a massive round at a $3.4 billion valuation, and while the terms aren\u2019 t exactly clear, the funding environment for that space may be softening a bit.
That\u2019s offered an opportunity for new companies to start to attract attention like Cornershop, a grocery-delivery app that operates in Chile and Mexico. The company raised $21 million in a financing round led by Accel as it starts to expand in that market \u2014 and potentially get ahead of looming competitors like Instacart. To a certain extent, however, CEO Oskar Hjertonsson may have Instacart\u2019s up round to thank for some enthusiasm in the space as the model starts to creep abroad.
\u201cThe longer answer is that I think Instacart can build a profitable business in the US, as can we down here, \u201d Hjertonsson said. \u201cI think the general notion that \u2018this and that service can\u2019 t exist\u2019 is the wrong way of looking at it. I think it\u2019s more a question of how to model the service for each market, including the positioning in terms of price\/value, to build a business that makes sense for each market.\u201d
Still, there may be an opportunity abroad, and that\u2019s part of what attracted Accel to the financing round, Accel partner Andrew Braccia said. \u201cInstacart\u2019s recent growth is another positive data point that we\u2019 re reaching an inflection point in the shift of consumer purchase dollars online not just here, but in large international markets as well, \u201d Braccia said. \u201cThey\u2019 ve demonstrated the patience and domain expertise required to tackle the opportunity before them in Latin America.\u201d
Hjertonsson said he announced the round internally with a temporary hiring freeze (which was more symbolic than anything) to explain to the team that the pieces were already in pace to grow, and that the company didn\u2019 t want to go crazy with the new funding. Of course, growth is still going to come in the next months as it expands to regions. And for a business like Cornershop, a lot of the growth is going to have to come from methodical expansion from region to region and with future partners.
\u201cI think it\u2019s a market where the early lead easily ends up in a position where it\u2019s easy to stay on top, I don\u2019 t spend much time thinking about competitors, \u201d Hjertonsson said. \u201cOur primary competitors are curiously also some of the stores from where we source. Walmart owned Superama in Mexico and the leading grocer Jumbo in Chile are our largest competitors.\u201d<\/p>\n

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Sentiment rank: 0.6<\/div>\n

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