Rocket Internet regular Tengelmann invests ‘up to $20m’ in Linio, its Amazon clone for Latin America

Rocket Internet‘s efforts to kickstart its e-commerce focused-startups in emerging markets got a significant bump today after Linio, its Amazon clone specializing in selling consumer goods in Latin America, landed new funding. The deal was announced as an undisclosed  ‘8-digit Euro sum’, but sources at Rocket Internet tell us it is worth between $15-$20 million; the company provided no specifics on how it will be spent.

As is often the case for Rocket Internet funding deals, the investment is being provided by a familiar name, German retail company Tengelmann. The group invested nearly $20 million in Asia-based Lazada last month, and was among a number of investors that put $15 million into Berlin-based app marketing startup Trademob, now it is giving its backing in Latin America.

The deal for Linio — which is active in Mexico, Peru, Colombia and Venezuela, for now — has plenty in common with Lazada, and Tengelmann is just one investor that the two companies share. Both perennial Rocket Internet backer JP Morgan and Swedish retailer AB Kinnevik have invested significant sums in both startups. The idea behind the two sites is essentially the same: bringing consumer retail services to new, untapped markets with large populations — both Southeast Asia and Latin America have cumulative populations of 600 million plus.

Last month’s funding announcement highlighted the progress that Lazada is making in Southeast Asia, and today’s announcement is similar for Linio. It doesn’t, however, provide any raw figures, as is fairly standard for Rocket Internet’s emerging market startups.

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• Linio says it is working to build awareness in Latin America, and says it “seeks to educate the Latin-American market about the benefits and convenience of online shopping” — from January: “Lazada seeks to educate the market about the benefits and convenience of online shopping”

• Linio ran a ‘Cyber Monday’ deals day to “to offer exceptional discounts and the best service to its clients” — Lazada ran a similar program — though Linio does provide a little more color. It says the offers increased sales “at the end of 2012” by 70 percent (and orders up 91 percent) but there’s no context to that.

• The company has reduced the delivery time of its products to 2-4 days — Lazada announced it was “able to guarantee two-day delivery on average across Southeast Asia”

Those figures don’t say much but Christian Winter, CEO of Tengelmann Ventures, is convinced that the service is making suitable progress to warrant the investment. A statement from Winter read:

Because of numbers like that [the sales and revenue increases], we are very excited to join the Linio team. Their growth trajectory, management team and investor base speak for themselves and we are confident that the company will succeed in the long-run.

Rocket Internet is increasingly pushing e-commerce services into ‘green field’ markets where the industry’s established giants — such as Amazon — are yet to set foot. That’s the case for Southeast Asia with Lazada, and Latin America with Linio, but there are other services too. FoodPanda, the German incubator’s take on Delivery Hero, expanded into 12 new markets last week. That included large, obvious markets like Brazil, Russia and China, but also less traditional places, such as Ghana, the Ivory Coast and Kenya.

Regardless of whether these moves are copycat plays to gain first mover advantage with a view to building a company that Amazon or its ilk might acquire — or whether they are more noble efforts to build businesses — Rocket Internet startups are bringing new services to emerging markets. That has positive benefits for Internet users in the region, as well as budding entrepreneurs, as we’ve said before.

Headline image via Thinkstock