As ecommerce grows here in the United States, there are still some significant hurdles for the Latin American market. Credit card penetration is lower than the U.S. and there isn’t the same infrastructure for shipping, meaning that returns are far more tedious.
That’s where Ropeo comes in.
Ropeo was founded by Alejandro Casas, Santiago Gomez, and Luis Huertas, who saw that the Latin American market was sick of in-store shopping but lacking the infrastructure for a powerful ecommerce play. Starting in Colombia, with plans to expand to the rest of the Latin American market, Ropeo wants to bring the clothes directly to the customer.
Here’s how it works:
Users who first sign up for Ropeo fill out a form around the type of clothes they like to wear, brands they like, budget and sizing. Ropeo then sends that information to its machine learning algorithm and along to one of its stylists, who select a number of items to be shipped to that user the next week.
The user has all weekend to try on the clothes alongside their existing wardrobe and determine what they’d like to actually buy. On Monday, Ropeo rolls through again and picks up the clothes that the user doesn’t want.
What’s more, Ropeo lets users pay for their wares with cash. The company says that 2/3 of the Latin American community uses cash to pay for things over credit card.
Ropeo sources its clothing inventory from boutiques as well as big fast-fashion brands, getting a commission on the clothes it sells from the boutiques. And of course, Ropeo is a subscription service, so it charges the user $7/month. That said, the company knows that not everyone wants to spend money on clothes month in and month out, so it is an opt-in service, asking users to notify the company if they want this month’s delivery.
Thus far, Ropeo is seeing around 50 percent conversion on the first box.
Ropeo is using a third-party delivery service to deliver and pick up clothing. But given how quickly Ropeo is scaling — the company is seeing more than 90 percent user growth each week since joining Y Combinator in January — there may be a need to vertically integrate delivery in the near future.
“Our greatest challenge is inventory and operations,” said cofounder and CEO Alejandro Casas. “Matching inventory with what customers want is the biggest challenge and risk. Which is why we’re using machine learning to support stylists and the buyers. On one hand it makes us more productive and it also minimizes the risk.”
Ropeo is currently operational in the seven biggest cities in Colombia (Bogotá, Medellín, Cali, Cartagena, Barranquilla, Santa Marta, Bucaramanga) and has raised $250K in total.