After closing the agreement in which Uber buys at Cornershop, the start-up became the first Chilean unicorn. The US company had already acquired more than 50% of the shares and in June announced that it would buy the rest. On Hispanic Entrepreneurs We tell you what you should know about the negotiation.
Cornershop in its beginnings
The company was founded in 2015 in Chile and Mexico at the initiative of Daniel Undurraga, Juan Pablo Cuevas and the Swede Oskar Hjertonsson.
What prompted you to create Cornershop? The three engineers had already worked on a Clandescount.com project together, which they later sold to Groupon. After this they began to work on the new start-up that they already sold to Uber, although the three are still in charge.
Cornershop's idea was to make a home delivery service available to consumers. Through this, customers make the purchase online or through the mobile application. Then a shopper is in charge of making the purchase and taking them to the site that the buyer chooses.
Such is the essence of how Cornershop works, a company that at its launch had a value of $ 300.000. With the capital of investors they reached 9.2 million in less than two years.
In 2019 Uber announced that it would buy 53% of the shares and the value amounted to 675 million dollars. With the announcement of the acquisition of the remaining 47%, the revaluation of Cornershop reached 3 billion.
Since its launch, Cornershop has become one of the main delivery applications in Chile.
Uber buys from Cornershop, how was the deal and what to expect?
For the founders of Cornershop, the agreement with Uber Technologies was cause for celebration. The Chilean start-up becomes part of the North American transport company, but it will operate independently according to what they explained when making the announcement.
Below we summarize what is known about the settlement and other information that led to its completion.
Walmart tried it first
Before Uber showed interest in buying Cornershop, Walmart tried it first. The deal was for $ 225 million. However, the purchase did not materialize due to obstacles from Mexico's Federal Competition Commission (Cofece).
The argument for Cofece's rejection was based on the association posing a risk to the other retailers. In the sense that both Cornershop and Walmart could refuse to work with other companies.
In the case of Uber, the antitrust commission in Mexico took a year before approving the negotiation.
It will maintain its independence
Part of the agreement in the Uber buys Cornershop is that it will continue to work independently. While it will be accountable to Uber Technologies, the leaders will remain the same as they have been until now.
Hjertonsson will remain at the helm, but will now report to Uber's VP of Delivery, Pierre Dimitri Gore Coty.
At the moment no changes are expected in terms of salaries or job positions. However, since the purchase of the first shares, the technology area of both companies has had a rapprochement. This is clear with the integration of Cornershop into the Uber app.
Possible expansion
Negotiations between the two companies began in 2019. By 2020, the first part of the purchase was completed. At that time Cornershop only operated in Chile and Mexico and since then it has crossed new borders.
In Brazil it took a short time before it became one of the leading service companies on-demand. In addition, it also reached Colombia, Peru, Costa Rica, the United States and Canada.
The partnership with Uber keeps the doors open to reach even more countries.
Greater opportunities for shoppers and drivers
The shopper from Cornershop They are the ones in charge of making purchases and delivering orders to customers. Thanks to the integration with the Uber app, demand increases and opportunities arise to get more income.
In the same way, for Uber drivers there is the ease of becoming shoppers. Thus, at times of the day when they have fewer users to attend, they can make purchases for Cornershop customers.
More customers and more businesses
In addition to the opportunity to have more customers, the number of shops and supermarkets associated with Cornershop is also expanding. This means more business opportunities, as well as the ability to reach places they previously had more limited access to.
The agreement by which Uber buys Cornershop represents a great opportunity for both companies. On other occasions, Uber has shown interest in other business models, not always with success. But in this case the expectations are high and so far the association has worked, so it is expected that it will stay that way and even improve.
With information of:
What was not known about the sale of Cornershop to Uber (df.cl)
Cornershop, the Latino startup that Uber just bought to compete with delivery services (entrepreneur.com)
Uber acquiring remaining stake in grocery delivery start-up Cornershop (cnbc.com)
