We all know that for Latin American startups, funding is no easy task. And even in Brazil, the region’s shining star, the problem of investment prevails. Angel investors and VCs are popping up in Latin America, and those from abroad are shifting their attention this way as well. The change isn’t coming as fast as it needs to, though, in order to sustain the budding Latin American technology ecosystem. With this panorama in view, a number of companies are forced to rely on their own funds for success.
Brazilian startup MuccaShop is a prime example of this, the company having relied on nothing but its founders’ personal funds since the very start.
Founded in July 2010, MuccaShop is an e-commerce website aggregator. Beyond offering users the chance at one-stop-shopping with a search engine that draws from various platforms, it has also launched Groupon-inspired Oferta do Dia and Orelha de Livro, a reading-related social network site.
While it may seem to be just one more line on a long list of Brazilian e-commerce companies we’ve been watching, what makes MuccaShop stand out is its bootstrapping approach to growth. The company’s founders have invested US$10,000 in MuccaShop to date, having received no additional funding from outside.
Recognizing the difficulties of receiving funding in Brazil as well as the urgency of revenue to stay afloat, the company’s founders have concentrated on sound SEO strategy, paid advertising and reinvestment to spring ahead. Now, the fruits of MuccaShop’s labor are beginning to appear.
MuccaShop now has a team of 12 employees and brings in US$30,000 a month from commissions and lead generation. One source estimated the website’s worth at over US$400,000 – 40 times its founders’ original investment.
Though outside investment is, of course, a huge boost for any startup, it is by no means the end-all be-all of success. MuccaShop is “living” proof.