07 Aug LOOOP – JAVIER PORTA
Loop produces and markets quality clothing and footwear to wear outdoors or to exercise. It imports raw materials and produces locally in Ecuador with local artisans under fair trade criteria. Javier Porta, co-founder of Looop, shares his experience as a Spanish entrepreneur based in Ecuador.
It all started a few years ago while working in the family textile company. At a time of crisis when we had weaving machines in Ecuador that we couldn’t sell, we had to reinvent ourselves. Thanks to our knowledge of the textile business, the local market and a lot of research work, we found a niche: making quality footwear to wear when you go out for a walk or do outdoor sports. We started with footwear, went on with clothes and then came accessories.
My partner, Jimena Romera, and I were always clear that our company had to have a social commitment and therefore LOOOP will be a B company in 2019/2020. We meet the requirements to be a company B and among our objectives is to have a positive impact on the social and environmental environment in the community in which we operate, and take into account the interests of workers and pay them a fair wage.
When one of our customers purchases a LOOOP product, 3% of its price tag is used to finance campaigns with vulnerable populations carried out by local or international organizations that guarantee the traceability and transparency of donated resources. For example, we are now working with the United Nations Development Programme – UNDP and we are proud to do so.
Europe, an attractive region for startups?
We differentiate two large market areas in Europe. The Nordic and German markets have socially committed consumers, who value the fair trade products and have purchasing power, who are willing to buy a product with a higher price but which meets a series of requirements of social commitment, impact, etc.
We have reached the Mediterranean market, specifically in Spain, out of affinity and because being Spanish is always easier because you know the market and its peculiarities.
What are the main challenges faced by startups when they expand into Europe from Latin America?
In our case, one of the challenges is that there is a lot of price competition and that means that every day we have to take it into account.
Another challenge, common to all entrepreneurs, is financing…I don’t discover anything new to anyone who has a company and wants to grow. We were self-financed at the beginning thanks to the capital of Jimena, my partner and co-founder, and now we are participating in an acceleration process in a social impact incubator (IMPAQTO) where the objective is to raise the necessary funds for the purchase of raw materials and to be able to invest in the creation of more stores in the main cities of ECUADOR.
We have just opened our first physical store in Ecuador.
Another challenge, independent of geography, is to compete with large corporations such as North Face, Patagonia etc. because they are obviously giants and we play in another dimension. That challenge becomes an opportunity that forces us to innovate and differentiate, for example, now we are seeing how to work with alpaca. It is a noble, sophisticated material from our region that allows us to enter a new niche that we still don’t know but that we are exploring.
Key learnings/recommendations for companies planning to grow internationally
Despite sharing the same language and having a common culture, LATAM countries are very different when it comes to doing business. Many people make the mistake of thinking that all markets are the same, but this is not the case because there are different regulations, laws, consumers with different needs, etc.
If you are a European startup or from any other region and you want to enter the LATAM market, it is important to carry out a process of what I call “tropicalization” of the business model, we have to adapt it to the reality of the local market.
Having a local partner is another recommendation I have. In my case, I lived in Ecuador and knew the market when we created the startup and that was a fundamental advantage, but if you don’t have that knowledge and access to local networks it is key to look for a local partner.
Finally, I want to encourage all entrepreneurs who have an idea to carry it out and bet on doing it in Ecuador. There are lots of opportunities and many areas where there are niches to explore… so go!