Time November 2/November 9, 2020When marcos Galperin
founded Mercado Libre in
1999, less than 3% of the pop-
ulation of Latin America was online.
But the Argentine’s e-commerce plat-
form flourished as the region became
more connected, and now claims to
be the market leader in all its major
economies. Like other online sellers,
it has thrived during the corona virus
pandemic, doubling sales in the sec-
ond quarter year on year. Galperin
spoke to TIME about the future of
e-retail and the economic potential of
the Americas.
What’s different about doing e-
commerce in Latin America com-
pared with Europe or the U.S.?
We had to create everything
from scratch. The logistics for
e- commerce and the infrastructure
for digital payments—we had to cre-
ate it all. Some of our international
competitors, like eBay and Amazon,
grew [much faster than us] from the
very beginning. Funnily enough, we have started to grow at much
faster rates now on our 21st anniversary. It’s an overnight success
story that took over two decades.Did you know Mercado Libre would be successful from the start?
When we launched, I did a survey with 20 Latin American classmates
at Stanford and asked them if they thought the model was going to
work in Latin America: 100% of them said no, that Latin Americans
would never buy something they hadn’t seen or touched from [some-
one] they didn’t know. It turned out it worked.In 2019, e-commerce accounted for roughly 4% of retail sales in
Latin America, compared with 11% in the U.S. How has the pan-
demic changed things?
I believe that that figure is going to be closer to 10% this year. The
pandemic moved us forward between three and five years.Mercado Libre’s market capitalization topped $60 billion this
summer, making it one of Latin America’s most valuable compa-
nies. Does that success feel strange while the world is suffering?
If it was us selling, maybe it would. But we are literally saving hun-
dreds of thousands of sellers from having to file bankruptcy. Latin
American governments have been less able to provide people with
the money to sustain long lockdowns than governments in Europe
or the U.S. provided. But millions of small- and medium-size busi-
nesses are able to continue operating safely and make a living. So,
on the contrary, we are becoming an essential service.The pandemic is likely to make inequality in Latin America even
worse than it already is. Is that bad for business?
For sure. Long term, we want a prosperous society with as many peo-
ple being well-off as possible. I believe equality per se is not a value.
We want the starting line to be as close to equal as possible. But that’s
a starting line. If some people want to work harder or they have a bet-
ter idea, and they make more, what’s the problem with that? It’s a bit
like sports. The best team wins and becomes champion, and the worst
team loses. And that’s, I think, more interesting for society in general.The pandemic has brought a lot of negative changes. Do you pre-
dict any positive changes?
I think we’re going to start addressing climate change in a much more
aggressive way. Businesses need to take the lead. For example, hav-
ing large companies like us put in orders for electric vehicles helps
a lot to jump-start the infrastructure we need.What’s your next big bet?
We believe cash will disappear in Latin America. Partly because QR
payments and digital payments are a better experience. But also,
because they use cash for everything, 50% of Latin Americans have
no history of their financial transactions and therefore no access to
credit. We have started to create a digital financial history for them.
That means we can provide loans to people that have never had ac-
cess to loans.I’ve read you enjoy chess. Has that helped you as a businessman?
I used to be a fan of chess. Now I lose to my son. So I’m not a fan
anymore. •SELLER’S
MARKET
Marcos Galperin, the e-commerce king
of Latin America, on betting against cash
By Ciara Nugent