Wednesday, November 29, 2023

En Breve Business: Mexican digital startups, work-life balance and GM’s move to electric

Mexican digital startups receive seed funding

Three Mexico-based companies – Welbe, Hero Guest and Kuona – have secured seed funding despite venture capital registering an overall decline in Latin America during 2022.

Founded in 2021 by Brazilians Eduardo Medeiros and Marcus Paiva, Mexico-based Welbe secured a U.S. $4.1 million seed-round led by Volpe Capital and Nazca, with the participation of SVLC, Kortex and GreenRock.

Welbe is a health-tech company that offers a comprehensive occupational medicine and health platform for companies, their employees, and their families. The platform provides complete employee health records and gives access to in-person or virtual medical consultations, as well as laboratory tests.

Hero Guest, a digital academy that trains front-line workers in the restaurant and hospitality industries, also secured funding by closing a U.S. $2.3M pre-Series A round with participating companies Grupo MVS, Variv Capital fund, and Grupo Anderson. After the financial round, the company’s valuation went to U.S. $8.8 million.  

“By being trained, the staff has a better performance in their work, more tips are generated, they have a lower turnover and thus have a positive impact on the business, which generates a virtuous circle,” CEO of Hero Guest, Gabriel García, said on Latam List.

Finally, SaaS (software as a service) startup Kuona, which uses machine learning to optimize product prices for retailers, closed a U.S. $6 million seed round led by COMET with the participation of Seaya Cathay, Latam and FEMSA Ventures.

The funds will be used to expand the company into strategic areas in Latin America, Europe and the United States. 

GM plant in Mexico will only produce electric vehicles starting in 2024 

The General Motors (GM) plant in the northern city of Ramos Arizpe, Coahuila, will only produce electric vehicles (EV) starting in 2024, Economy Secretary Raquel Buenrostro announced. 

The company also shared that by the year 2035, they will convert their other two Mexican plants to EV manufacturing.

In April 2021, General Motors announced a one-billion-dollar investment to expand the Ramos Arizpe plant and have it ready to produce EV. The company seeks to make this plant the fifth larger manufacturer of EV within General Motors North America. 

The Economy Ministry announced that General Motors has created 4,500 new jobs since President López Obrador took office, at their plants in Ramos Arizpe and San Luis Potosí.

Mexico ranks low in work-life balance according to UN report

“Innovative working time arrangements such as those introduced during the COVID-19 crisis, can bring benefits to economies, companies and workers, including higher productivity and a better work-life balance,” the International Labor Organization (ILO) said. However, Mexico doesn’t seem to be part of the trend. 

According to the ILO’s Working Time and Work-Life Balance report, Mexico is part of the group of nations that have a greater labor imbalance including the Philippines, Chile and Venezuela. 

Either because there are those who work fewer hours than they need, or because there are people who have longer working hours than those legally mandated, 41.7% of Mexico’s workforce suffers from work-life imbalance, only surpassed by the Philippines (43.2%) and slightly above Chile (40.9%).  

The nations with the lowest levels of imbalance among their labor force are Croatia (11.0%), Austria (14.2%) and Hungary (14.2%).

Streaming services closed 2022 with boost in subscribers in Mexico

Disney Plus, HBO Max, Netflix, Vix and other streaming platforms went from 12.8 million users in the third quarter of 2022 to 13.1 million by the end of the year, a jump of 300,000 new subscribers in Mexico, reported consulting firm The Ciu.

According to The Ciu analyst Radamés Camargo, consumption tends to increase in December because a subscription to a streaming platform is a “classic gift”. Moreover, people usually have more time in December to consume content, Ramadés said, which gives “an additional boost to the platforms.” The challenge then, is to retain those users. 

With a possible recession ahead and continued inflation, companies like HBO have issued promotions to retain consumers. Advertisement is another strategy for customer retention  because the monthly fee is less expensive.

Camargo said that the streaming services must find new options to keep them ahead of their competition, not only in terms of pricing, but in terms of new products.

With reports from Expansión, Latam List, Latam List, Bloomberg, El Economista and Forbes

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