By Kylie Madry
MEXICO CITY (Reuters) – Used-car startup Kavak is re-concentrating efforts on its home market, a top executive said, following the company’s announcement it would close shop in Peru and Colombia.
“You have a burst of growth, and then you screw up a bunch of things, and then you fix them and you’re ready for another phase of growth,” said Jaime Macaya, Kavak’s South America head, in a panel hosted by venture capital fund Wollef late on Wednesday.
“So I think right now, we’re at that standardisation phase,” he said, adding the company was now looking to focus “a bit more on Mexico, which is our main market.”
Kavak broke records as Mexico’s first startup to top a $1 billion valuation and operates throughout Latin America, as well as in Spain and several countries in the Middle East.
But the company announced this month that it would “indefinitely pause” operations in Peru and Colombia at the beginning of next year, citing the macroeconomic environment and outlook over the coming months.
Kavak kicked off sales in the South American nations last year, pouring millions of dollars into the launch.
“We’re finding our path to taking other markets to profitability, and I think that will take us a good part of the next three or four quarters,” Macaya said.
Kavak had warned of a “challenging 2023” last year in an internal email announcing expenditure cuts and layoffs.
(Reporting by Kylie Madry; Editing by Janane Venkatraman)
