Buenos Aires-based Officenet, a major Web-based office supply and service company that caters to small- and medium-sized businesses in Latin America, recently raised $34 million in a venture capital financing.
BancBoston Capital led the deal and was joined by fellow investors CRI America-BSCH, as well as TH Lee Internet Investments, Latin America Enterprise Fund and Latin Rim Fund.
“This is one of the largest rounds of financing in Latin America since the dramatic market disruption in April,” said Andy Freire, co-founder and chief executive officer of Officenet, in a prepared statement. Freire’s goal is to make Officenet the strongest office supplies network serving small-and medium-sized enterprises (SMEs) in Latin America. The company provides more than 10,000 office supply products and an array of business tools and other office solution services to SMEs.
Freire and Santiago Bilinkis founded the catalog-based office supply company in 1997. Using the Internet as its technology platform and an account manager business model, the founders migrated more than 50% of its sales online, according to the company.That year, it also received $7 million in private investments from the PCP Group. Since then, Officenet has acquired more than 22,000 active clients in Argentina and Brazil, generating approximately $1.8 million in monthly online sales. The company anticipates gross annual sales of $43 million this year, and has 400 employees.
“Officenet has real revenue [and] real profits,” said Sebastian Valdez, vice president at BancBoston Capital. “It’s a real company, not another dotcom.”
Officenet will use the recent funding to continue its penetration into new markets and is considering Chile and Spain as potential targets. In August 2000, the company began its regional expansion by opening operations in Brazil.
Officenet was recently spun off by Submarino.com from Submarino.com Holdings, which was created last year with a strategic transaction between the two Web companies. Submarino originally acquired Officenet in a move to expand its b-to-b business.
Antonio Bonchristiano, chief executive officer of Submarino.com, said the two companies may explore future opportunities where each can learn from each other to solidify their business goals, but otherwise will follow independent paths.
H.M. Werner can be contacted at Story Feedback.