Our Investment in TUL
Construction is a leading industry in Latin America driving economic growth and creating prosperity, worth over $140 billion annually and growing every year. It’s also a highly distributed industry, with over 50% of material volume going through small and often family-owned hardware businesses. These small businesses constitute the core of the industry, but they face a number of challenges.
Small retailers often spend hours on telephones getting quotes from wholesale suppliers and negotiating with buyers; they deal with long lead times and slow delivery. These problems cut into profits and create a very slow cash conversion cycle, holding small businesses back and massively limiting the amount of potential commerce. But it also creates an opportunity to deploy a vertically integrated technology product that is uniquely tailored to the market.
Colombia-based TUL is doing just that, unlocking untold future value for the industry and the tens of millions who participate in it, especially those at the small scale. With so much volume happening at the local and family level, empowering those market participants is a massive business opportunity. After participating in TUL’s 2020 Series A, we’re proud to expand our partnership by leading their Series B financing round. It’s one of our biggest bets yet on the value of industry transformation in a growing market.
TUL co-founders Enrique Villamarin (CEO), Juan Carlos Narváez (COO), and Nicolas Villegas (CTO) are among the best entrepreneurs and technologists in the region. 8VC is augmenting their experience in Latin America and strong executive leadership with our deep institutional knowledge of building great businesses.
TUL has engineered a full-stack, tech-enabled logistics service, backed up by a robust network of physical assets. In one place, TUL is collapsing the gulf of separation between each corner of the market: supplier, retailer, and consumer. Businesses can purchase materials from a variety of vendors and don’t have to worry about coordinating delivery.
For suppliers, TUL gives visibility into market volumes and makes it easier for them to provide more products to more retailers. Adopting TUL technology can have a generative effect for these businesses, especially as more tools are added to the platform in the future. Through digitization, businesses can get access to 21st century financial products and services.
TUL is helping to bring small businesses and the families that run them into the digital world. Injecting technology into an industry with many thousands of players operating in low-tech frameworks is a challenge, which is why TUL’s attention to detail and ease-of-use is critical. TUL is leveraging strong local relationships to help drive adoption of their product, which is powerfully simple, even for businesses with limited internet experience. TUL’s entire platform and suite of tools is available on mobile. By cutting costs for suppliers, retailers, and builders alike, and capturing value in the savings, TUL’s business is creating abundance.
TUL CEO Enrique Villamarin brings a wealth of experience and operational expertise to the job. He spent nearly a decade in the Latin American cement business and comes from a family with a streak of entrepreneurship. In just two years, he’s attracted top-tier talent to the company and grown it rapidly. We’re excited to see how he and the rest of the TUL team innovate in 2022 and beyond with new capital from this financing round. TUL is expanding to more cities and markets, including Brazil, the largest market in Latin America.
This investment is an opening salvo for 8VC in one of our long-term goals as a firm: to take a leading role as US investors in Latin America. Innovation and entrepreneurship have always been the credo of the new world, both before the industrial revolution and after, both in the US and our neighbors to the south.
As Latin America grows, so will TUL.