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Mottu, a motorcycle rental startup based in São Paulo, Brazil, is accelerating its growth with a $40 million investment aimed at enabling more Latin Americans to pursue courier opportunities. The funding includes $30 million in equity from a Series B round and an additional $10 million in debt financing, a crucial lifeline for workers with limited or poor credit histories who are unable to purchase motorcycles outright.
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Founded in early 2020, Mottu began with a fleet of 200 motorcycles in São Paulo, quickly expanding to 1,000 motorcycles and generating $2 million in annual recurring revenue by the end of the year.
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Today, the startup operates in eight Brazilian cities and Mexico City, boasting a fleet of 10,000 motorcycles and achieving a remarkable 5x growth in annual recurring revenue in 2021, reaching $10 million by the end of the year, according to CEO and founder Rubens Zanelatto.
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Verde Asset, a prominent Brazilian investment management firm, provided the debt financing to facilitate Mottu’s ambitious plans to quadruple its fleet by the end of the year, with the ultimate goal of reaching 50,000 motorcycles by 2023.
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Beyond motorcycle rentals, Mottu has evolved its business model to offer additional support services such as credit, insurance, maintenance, and round-the-clock assistance to its renters. The company also operates a driving school for individuals aspiring to become couriers.
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This latest funding round follows a $20 million Series A financing in early 2021, which enabled Mottu to expand its fleet, extend its geographical reach, and develop its delivery services. Over 1,000 retailers currently utilize Mottu’s delivery offering.
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Mottu intends to utilize its fresh capital infusion to hire more than 50 senior engineers and appoint a chief technology officer, augmenting its existing team of 400 employees.
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Notably, Base Partners and Crankstart, a San Francisco-based family foundation founded by Harriet Heyman and Sequoia Capital Partner Michael Moritz, co-led the equity portion of the funding. Tiger Global Management participated in both Mottu’s Series A and Series B rounds.
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Mottu’s mission is to address key social issues in Latin America, particularly unemployment and crime. The company primarily serves individuals with poor credit ratings, enabling them to access motorcycles for courier work. Customers pay a weekly rental fee of approximately $150 per month, effectively characterizing Mottu’s service as “Hardware-as-a-service.” On average, customers earn more than the minimum wage, which is $300 per month in Brazil.
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In addition to providing economic opportunities, Mottu’s branded and tracked motorcycles enhance safety, reducing the risk of robberies by fake couriers, a growing concern in Brazil. Remarkably, the company reports zero delinquency rates, as customers are motivated to pay promptly to maintain access to the motorcycles they rely on for their livelihoods.
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Fernando Spnola, a partner at Base, commends Mottu’s founder, Rubens Zanelatto, as a visionary entrepreneur who combines bold aspirations with practical execution. Spnola believes that Mottu’s emphasis on empowering couriers and building a robust technology platform positions the company to lead Latin America’s evolving internet economy.
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Spnola also highlights the critical role logistics plays in online commerce in the post-pandemic economy and sees Mottu as a central player in advancing this essential component of the equation.
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Mottu is not the only Brazilian startup tackling unemployment through a rental model. São Paulo-based Kovi, with its all-inclusive car subscription model, aims to make vehicle ownership affordable for more Latin Americans working in ride-hailing services. Last August, Kovi secured $104 million in a Series B funding round to support its mission.