Autolab Raises $6.5M USD in Seed+ round2021-12-01 | Maria Paula Polchlopek
Autolab, Latin America’s leading auto repair and parts platform, has raised $6.5M USD in a Seed+ round of capital and debt led by Bullpen Capital, with participation from Proeza Ventures, VU Venture Partners, 10X Capital, Western Tech Investments, and Polymath Ventures. Autolab, a Polymath Ventures company, was launched in 2014 looking to provide a new alternative to a highly traditional industry dominated by low-trust independent auto repair shops and high-cost dealerships.
Autolab has built a platform that unlocks incremental growth for independent auto repair shops while providing trustworthy and affordable solutions for car owners. Currently, there are over 600,000 independent auto repair shops in Latin America, most of them with limited growth opportunities due to a lack of knowledge in customer acquisition, client management and operations, and limited access to capital. According to recent research done by the Bogota Mayor’s office, around 50% of auto mechanics interviewed have monthly incomes below $240 US, while around 65% reported working more than 10 hours per day. Autolab provides a solution for these mechanics to elevate their businesses and improve their quality of life through the improvement of their operations and service.
Autolab is currently the largest chain of auto repair shops in Colombia and has already impacted over 70 auto repair shops in 10 Colombian cities through their business model designed to provide a best-in-class experience and dramatically improve profitability, up to a 700%+ increase in profit.
“Reaching this milestone is an important step for our team and growing network of shops in Latin America. The pandemic challenged us to be resilient, innovative, and even more agile than ever. Amidst the hardest quarantine, we launched a new disinfection product to serve public and private drivers working in the streets, we digitized our operation to increase capacity and adapt to the quarantine measurements and grew shop visits by 7X. Autolab arrived to provide a service alternative with great service at affordable prices in Latin America; we upgrade the independent shop experience with technology and guaranteed quality” – Salvador Zepeda, Founder and CEO of Autolab.
“The pandemic challenged us to be resilient, innovative, and even more agile than ever.” Salvador Zepeda, Founder and CEO of Autolab
The auto repair market in Latin America is worth $74B US annually and will continue to grow as the demand for mobility increases. The industry’s acceleration is mainly driven by two factors; the healthy recovery of the auto market and the growing base of independent auto repair shops. The recovery of the auto market is directly connected to the reopening of cities and revamp of global economies; according to Statista, the global automobile sales average is 70 million units per year. At the same time, users reluctant to buy new cars are shifting their buying behavior towards boosting the life and trade-in value of their vehicles. Latin America is well-positioned to evolve this industry, due to the high concentration of owned cars.
“We see the Autolab team tackling a real problem in the region, and one that exists throughout the emerging market, the lack of trust in independent mechanics shops and on the other side, auto dealerships’ high prices. In the process, they have created a highly scalable solution with multiple growth avenues, with the potential to disrupt spare parts, repairs, and maintenance business globally” – Enrique Zambrano, Principal at Proeza Ventures.
“We see the Autolab team tackling a real problem in the region.” Enrique Zambrano, Principal at Proeza Ventures.
The milestones achieved over the past 12 months reflect the massive opportunity for Autolab and the overall industry. From August 2020 to July 2021, Autolab grew its shop network by 7x and revenues and shop visits by 4x. To extend its operation and impact, Autolab continues its growth with a talented team of 100 people under the leadership of Salvador Zepeda and Andrew Hallman.
The recent capital and debt will enable the accelerated expansion of the company on three major fronts; shop growth, product development, and new business units. Autolab recently opened its operation in Mexico and will be present in Peru in the next 12 months, increasing its network of allied shops from 50 to 400. At the same time, the team is prioritizing the investment on the auto parts product, a major pain point of the shops. Autolab’s third bet will also focus on strengthening its fleet service in Colombia and launching it in Mexico by February of 2022.