Portuguese online printing services platform 360imprimir, or 360 Onlineprint in English, wants to become a hundred-million-euro company by revenue by 2021. The six-year old startup recently raised €18m in a Series B investment round led by LeadX Capital Partners, the German investment arm of retailer METRO Group.
The monies are going toward funding 360imprimir's large-scale international expansion. Commenting on LeadX's lead role in the deal, José Salgado, 360imprimir's Chief Growth Officer and co-founder, said in an interview: “We share the same mission of digitization and supplying the SME market so as to empower SMEs.”
Salgado was speaking to CompassList at the Lisbon Investment Summit in June. The company expects revenues of around €35m in 2019.
Joining the German group were Portuguese venture capital firm Pathena and France's Omnes Capital – both prior investors in 360imprimir – as well as the Portuguese government and the EU via 200M, the innovation fund administered by PME Investimentos. The investment will see the already international Portuguese startup expand from its current four to 21 markets simultaneously while boosting its product range from the current 400 items on offer to some 20,000 by 2021.
“We will be able to produce such an ambitious number and range of products because our model has no limitation when it comes to the product development by applying customized designs to any product category,” said Salgado. Another motive for such a drastic increase in product range in less than two years: “We want to be the Amazon of corporate products and marketing services.”
Directed at the B2B SME segment, 360imprimir already sells all manner of customizable products, from T-shirts to placards and business cards to reflective jackets. Later in 2019, it will sell customizable packaging, catering especially to the “growing segment” of paper bags, as well as labels and other products such as dishes and glasses.
Portuguese base, global vision
“The more markets we enter, the higher the diversification of risk,” asserted Salgado. “After the funding round, we are now entering the US and have also entered France, the UK, Germany and Italy – our potential big markets”.
The other markets 360imprimir has entered are Canada, Ireland, Belgium, Switzerland, Austria, Denmark, Sweden, Finland, Norway, Czech Republic, Poland and the Netherlands – the home country of Vistaprint, the company's biggest rival.
Like many other Portuguese startups, going global was a priority “from day one” for the startup based in the small Lisbon municipality of Torres Vedras. In 2014, the same year it began selling products in Portugal, it also launched services in Spain. At the end of that year, it held its first seed round with the objective of entering Brazil months later. The company entered its fourth market, Mexico, in 2016 – its last market entry before the current market entries.
“We spent more time on Brazil because we had integrated Brazilian suppliers into multiple production hubs and it is also part of our business strategy to leverage the existing capacity from suppliers,” Salgado said.
Because the startup is an online marketplace and not a manufacturer of goods, Salgado boasts of having “zero stock”, noting that 360imprimir's relationships with its suppliers are paramount and thus developing these relationships are a priority.
With the expansion, the startup will have entered all of Vistaprint's major markets, gaining exposure to its competitor's 12m customers. 360imprimir now has 1m customers, a fivefold increase from its initial customer base three years ago.
Notably, Salgado said, its main competitor left Portugal two years ago, and Vistaprint is now rapidly losing market share in Spain to 360imprimir. Taking another step towards internationalization, the company will expand into its new markets under the brand, 360 Onlineprint.
Entering so many markets simultaneously presents the company with logistical problems. While the long-term objective is to use local suppliers in each market once sales volumes justify the costs, this is not feasible in the short term. As delivery costs from Portugal are high, the company uses Germany as its hub for European deliveries, and will temporarily serve its new North American markets from Mexico until sales levels permit feasible partnerships.
When it comes to scaling internationally, Salgado said the company's product line presents no obstacle. “Whether you are in Brazil, the US or Spain, all SMEs need corporate branding and generally we don't detect much difference in product needs between the markets as the core needs are similar.”
Besides Salgado, 360imprimir was co-founded by CEO Sérgio Vieira, Diogo Silva, João Matias, Pedro Gaspar and Jorge Correia, who hail mainly from the finance and debt management sectors. The idea for the company was born when Viera and Correia were at university. They were shocked at the prices charged for photocopying documents and the huge profit margins made by brick-and-mortar print stores, realizing that customers' costs only go down with huge print runs. The team knew that printing was a major cost for SMEs, so despite having no background in industrial production, they decided to “bring critical judgment and think outside of the box” to cofound 360imprimir. Salgado even gave up a full scholarship to pursue an MBA at INSEAD in order to start 360imprimir.
48-hour delivery pledge
From the outset – and unlike major printing brands, like Staples – the founding team was determined to establish a solely online company and stake out a unique selling proposition.
“The beauty of only being online is the ability to scale up and reach critical mass much faster,” Salgado said. “We need no production facilities or stock, and can be far more agile than if we were offline, allowing us to rapidly establishing relationships with different industrial suppliers.” He stressed that 360imprimir is not a typical marketplace as it “aggregates orders from different SMEs on our platform, matching them with the best suppliers for each job in order to improve efficiency and delivery time”.
SMEs never have to interact with the suppliers as 360imprimir is the only customer-facing brand and assumes all relevant responsibilities. The startup aggregates orders and automates the sales process with the suppliers. As the speed of its technology is so important to 360imprimir, one-third of its 200 employees work in IT.
Speed, choice and value-for-money are the company's strengths. “Usually, it takes SMEs one month to get a personalized or customized product from a new supplier – with two weeks spent getting quotes – but we commit to delivering such products in 48 hours,” he said.
He added that 360imprimir's pricing and ease of ordering, especially for personalized or customized products, is a key selling proposition. The sheer variety of customizable products on offer – with no setup costs for customers – is another key appeal.
“For us, it is critical that our key market, SMEs, have the power to access our products so there is no minimum order. We ensure that the pricing for smaller quantities is still close to the pricing for larger quantities. Usually, mass customization leads to a very high price per unit, but not with us. This is why automation and aggregation are assuming an ever more important part of the business model."
Unlike other Portuguese startups that have made it big, 360imprimir is committed to remaining based in Portugal and developing local talent. It will hire an additional 100 staff for its four offices spread around the nation in a bid to attract talent from different areas.