Latino auction site gets cash infusion
MercadoLibre, looking to be the Latin American equivalent of eBay, secures $46.5 million in funding from investors.
The Latino auction site targeting Spanish- and Portuguese-language online auction markets secured a $46.5 million investment today from investors including Goldman Sachs, GE Equity, Banco Santander Central Hispano, Chase Capital Partners, Flatiron Partners and Hicks, Muse, Tate & Furst.
The Miami-based start-up operates in nine countries throughout Latin America, Europe and North America and has auctions in 25 categories.
The investment will allow MercadoLibre to move forward with plans to build payment and shipping systems and bolster customer service, the company said.
Currently, auction heavyweight eBay, with a huge U.S. presence, has yet to offer auctions in Latin America. Yahoo has auctions in Brazil and Mexico.
"The investment demonstrates our belief in MercadoLibre's ability to remain a major player in a region with significant growth potential," said Goldman Sachs managing director Tim Kingston. Kingston is also a member of MercadoLibre's board of directors.
Jupiter Communications predicts strong growth in Latin America, where it pins growth at about 66 million users by 2005, up from 10.6 million last year. Jupiter forecasts e-commerce spending will hit $8.3 billion in the same period.
MercadoLibre currently has online auction services in nine countries: Argentina, Brazil, Chile, Colombia, Mexico, Venezuela, Uruguay, Spain and the United States.
Last year, Latin American Internet auctioneer DeRemate.com received $12 million in funding from Citigroup and Merrill Lynch, among others.