This startup has developed a new digital platform to serve an important part of the informal economy in Mexican communities.
I’ve written before about how grey markets often provide opportunity for new startups. Rafiki, a new venture in Mexico City, is an excellent example.
It turns out that raffles are very popular throughout Mexico. If someone wants to sell a car, for example, they might hold a raffle (called a rifa) and everybody in town buys a raffle ticket. It’s fun, the winner gets a new car for the price of one ticket, and the seller gets to keep the proceeds. Raffles are popular all over Mexico for buying and selling things like mobile phones, household appliances, automobiles, and more. They are a big part of the informal economy.
Rafiki, the innovative new startup, is taking this large informal market activity and providing a digital platform that makes it better. The Rafiki app has a suite of tools that make it easy for an organizer to create and manage a raffle. Participants can find amazing products being raffled, buy tickets on their mobile phone, and track the progress of the raffle. At the end, the organizer sends the product to the winning participant, the delivery is validated, and the organizer receives the money.
One of the reason that fintechs in general have been so successful throughout Latin America is that there is a large informal economy, waiting to benefit from digital applications that run on a mobile phone. Rafiki is an excellent example of a venture that is taking a large existing market of financial transactions (Raffles within Mexican communities) and bringing the structure and efficiencies of a digital platform.
Rafiki will be presenting at Demo Day for the 4thly Startup Accelerator on July 7.
