Canela Media, a
startup created for Latinos, raised $32 million in a Series A round to help fund its growth plans, which include a new tech center, children’s service and expansion across Latin America.
An investor pitch deck that was shared with Insider shows how the Latino-owned media company sold venture capitalists on its vision for a streaming home for Latinos — with content ranging from telenovelas to news and news. through sports; and in English, Spanish and Portuguese.
“I kept reading about the streaming wars,” co-founder Isabel Rafferty told Insider. “But I’m a Latina and my options are very limited… Obviously there’s an audience that’s not being catered for.”
That was Rafferty’s thinking when she co-founded Canela in 2019. The company rolled out its free Canela.TV video streaming service and linear channels the following year, and has since launched a standalone app for music videos.
Latin America has been a major growth driver for streamers, especially
, which invests in original programming from Brazil, Mexico and other Latin American markets. Recently, however, the “macro strain” of the pandemic has hampered growth there, Netflix told investors in January.
Still, that hasn’t stopped other streamers from seeing the potential in the market. WarnerMedia’s
and Disney+ and Disney’s Star+ streaming services have recently expanded into Latin America, with sports and entertainment programming. And, in the United States, where there is a large Latino population, Spanish-language TV giants including TelevisaUnivision and Telemundo are making further streaming pushes, with the former relaunching its Vix streaming brand and the latter ahead of to debut on its sister streaming brand Peacock.
Most of these services are paid, with the notable exception of Vix and Peacock, which offer ad-supported free options as well as paid tiers.
Canela’s video streaming app, Canela.TV, is completely free and supported by ads. Rafferty said she wants it to stay that way, citing generally low credit card penetration among Latinos.
But Canela’s ad-supported model became a challenge for the company when it first launched its service in 2020, at the height of the pandemic. Rafferty said nearly all of the advertisers he signed on have pulled out, as many big brands have withheld spending on emerging platforms and technologies.
But Rafferty said audiences gravitate towards Canela, who has seen a surge in user growth during the pandemic, like many other free and subscription streamers.
“We were there when the public needed us the most,” she said.
She also said the Black Lives Matter and social justice movements following the murder of George Floyd have spurred attention and investment in minority-run businesses. This momentum helped Canela secure $3 million in seed funding in October 2020.
With the Series A, Rafferty said the company intended to raise $10 million, but increased that to $22 million after seeing investor interest, and eventually capped the round at $32 million. of dollars.
She said investors were most struck in pitch meetings by Canela’s audience and revenue growth statistics. The company’s pitch deck said it had 8 million users on its video streaming app, Canela.TV, and projected revenue would grow 93% year-over-year in 2022.
Canela Media has shared the full 20-page pitch deck he used during his Series A with Insider. In the 18-page February release posted below, the company updated several slides and removed some financial and user information.