Rappi co-founder Sebastian Mejia on escaping the competitive dynamic of on-demand

Hey everyone!

Last week, Rappi president and co-founder Sebastian Mejia joined us for a one-hour Q&A on Rappi, the Latin American on-demand economy, and building a local, multi-vertical business.

Check out the full transcript of our call with Sebastian here.

During our discussion, Sebastian went into detail on the ways Rappi is escaping the highly competitive dynamic of on-demand:

  • Growing purchase frequency to 11x/month by year 5: Rappi's continued addition of new verticals increases purchase frequency, which grows customer lifetime value. Rappi cohort data shows that frequency grows from 2x/month in year 1 to 6x/month in year 3 to 11x/month in year 5 

  • Vertical integration to optimize costs and improve unit economics: With 300+ dark kitchens and micro-fulfillment centers, Rappi begins to diversify its logistic model from point to point to hub and spoke

  • Building a fintech business to facilitate scale: Owning payments improves Rappi’s unit economics, helps their banking partners underwrite more risk, and creates another driver for higher frequency of use for consumers

Check out the full transcript of our call for more and let us know what you think!