Designing higher end furniture for Mexico's rising middle and upper-middle class consumers has netted the Mexico City-based GAIA $15 million in a new round of funding.
The bridge round will take the company through to a much larger capital raise planned for 2021 as the company capitalizes on the growth of e-commerce in Mexico.
A 2019 report from JP Morgan put the e-commerce market in Mexico at around $22.6 billion, and that's with online sales only accounting for just 1.7% of the overall retail market. JP Morgan expects the market to increase at a 12.6% growth rate annually.
As with everything else, the COVID-19 pandemic has accelerated the adoption of digital services as the country's population looks to practice safe social distancing and reduce the spread of the virus. For those consumers who can afford to shop online -- even for high value products like furniture -- they are, according to GAIA chief executive Philippe Cahuzac.
At GAIA the new funding will be used to add new features to the company's online service, including consultations with interior designers, the development of curated looks, and the ability for customers to create design sketches and visualizations for products in the home. The company expects to also double down on its sales and marketing efforts with the new cash.
GAIA's funding also helps extend the company's vision of supporting small and medium-sized Mexican furniture producers through financial products, training and revenue management tools and educational offerings.
Launched by Raffaello Starace, Hassan Yassine, and Cahuzac the company started as an online retailer exclusively, but now has expanded to 15 showrooms in Monterrey, Mexico City, Guadalajara, Puebla and Queretaro.
"We want to offer a branded and frictionless urban experience to the modern Mexican consumer," said Cahuzac in a statement. "In five years we built the leading digital player in the home category in Mexico."