Ep. 37: A new Mexican NeoBank? Yes, but in the US.
Welcome to Scenius Mexico: Your weekly newsletter on technology, innovation, and startups in Mexico.
This week a kind-of Mexican FinTech has raised a new equity round. While Comun is not based in Mexico it is co-founded by two Mexicans living in the US and targets the US-based Mexican (and latino) community. So, I decided to cover them anyway.
API-specialized startup Palenca will help Kovi make its innovative model work in Mexico. Where some FinTech focus on offering credit to gig economy workers to allow them to buy a car to join mobility platforms, Kovi offers weekly car rentals instead.
A new Chilean startup coming to Mexico? Yes. How about a Spanish one? Also, yes. But this week we’ll also welcome a South African one! Armed with a recent US$100 million funding, Rent-to-Buy tech company Planet42 is making Mexico its new casa.
And Tesla…
Equity Funding Rounds
NeoBank Comun closes a US$4.5 million equity round
While not a Mexican Startup per se, Comun was founded by two Mexicans living in the US and targets the US-based Mexican community. The idea behind Comun is to build a digital bank in Spanish to offer the latino community a product in the language they know best - and thus increase financial inclusion. And this represents quite a big market - about 44 million people, of which 41% have no credit score yet.
It’s not too much of a stretch to imagine that this startup’s roadmap includes opening operations Mexico in the near future to make a financial bridge for people and families living between the two neighboring countries.
Sector: FinTech - NeoBank
Total raised to date: US$4.5 million
Founders: Abiel Gutiérrez, Andrés Santos
Investors: Silicon Valley, Costanoa Ventures, South Park Commons, FJ Labs
VivaWell closes a US$1.6 million Seed round
Founded in 2020, the startup provides a comprehensive approach to health insurance for corporations and individuals. In addition to focusing on primary health, they recently expanded their model to cover well-being and life quality in general.
The capital injected will be used to grow their market share in Mexico, hire more team members and focus on product development.
Sector: HealthTech
Total raised to date: US$1.6 million
Founders: Héctor Peña, Eduardo Iglesias
Investors: Family Offices
Startups News
Palenca partners with car rental platform Kovi
Mexican startup Palenca is a payroll API that enables companies to verify income, identity and employment data of any worker based in LatAm in just one click. By joining forces with Kovi the two companies want to revolutionize the car rental industry for gig economy platforms in Mexico. Drivers need a car to start working for companies like Uber or Didi, but not everyone has access to a credit line to buy a car for work. So, Kovi announced a weekly rental offer directly linked to the driver accounts, which are already connected to a mobility platform. Palenca, for its part, will help Kovi better manage identity verification and risk mitigation.
DEV.F X Bécalos X BID Lab
EdTech DEV.F is partnering with Bécalos and BID Lab to offer free coding classes to youngsters from the southern states of Mexico: Campeche, Chiapas, Guerrero, Oaxaca, Puebla, Quintana Roo, Tabasco, Veracruz, and Yucatán. 8 out of these 9 states are ranked as the least developed states in the country in terms of access, use, and general knowledge about digital tools and services. While Mexico is growing as an international technological hub, a big gap exists in terms of technology development across the country.
Mercado Pago launches a new Visa card for the Mexican market
Mercado Pago, the FinTech arm of Mercado Libre, has been emerging as a strong player in the Mexican environment and is planning to keep pushing for more market shares. Not only will the credit card allow users to make payments and to shop in any physical or digital store, but it will have offer six months of interest-free installments (meses sin intereses) for any purchase made on Mercado Libre.
FinTech Mendel partners with SAP Concur
The Mexican corporate spend management startup will use SAP technology and international experience to offer its customers a new solution to increase compliance with tax laws, mitigate fraud, and manage important budgets. In addition, Mendel will integrate its invoice validation product into SAP Concur - which includess 600 corporate clients in the region.
Rest of the World
South African Startup Planet42 opens shop in Mexico
The Rent-to-Buy tech company, which mainly operates in South Africa, received a US$100 million debt and equity capital injection to grow within its native country but also to further expand in Mexico. Founded in 2017, the startup provides vehicle financing to people who can’t access it from banks. Cars and financing are two hot trends in Mexico it seems.
Aguas! Tesla chose Monterrey
It’s the news of the week, after a long negotiation ending with a video conference between Elon Musk and AMLO, the mutual decision has been made - Tesla will open its new GigaFactory in Monterrey. Why did it take so long and why was it such a big deal? Because we are talking of an investment estimated between US$1 billion and US$10 billion that almost fell through due to internal political fights.
Chilean Datamart raises US$6.3M to go to Mexico
The FinTech developed a platform to better exchange sensitive information between financial institutions and their clients during the credit line approval process, making the workflow smoother while complying with local laws and keeping a high-level of security and privacy. Mexico is a heavy player in the region with still a lot to do on the credit business side; Datamart co-founders decided to raise a new equity round to go all-in on their expansion plan.
Spanish Sesame HR to land in Mexico
The Human Resources tech company is quickly growing in its native country and chose Mexico as a first destination in its expansion plans. Sesame HR CEO, Albert Sorian, sees Mexico as a country where companies have embraced technology at an accelerated pace in the last few years and where the SaaS model has been successful.
Simon is the director and founder of Pixpik Studio, a communication and data collection tool for companies through gaming.
Born in France but based in Mexico since 2013, He has been working in the gaming industry for 10+ years. First in Gameloft, a mobile games company, as a game producer, before joining the commercial team as KAM for Mexico and eventually LATAM.
For a long time he had the conviction that video games could be used way further than for entertainment purposes.
Pixpik started with a collection of eco-games on the App Stores aiming at raising awareness in people about environmental topics while playing. With his two co-founders they quickly understood that the huge traffic they were generating on their games could be monetized. They decided to bring their games to companies for them to benefit from it too.
Today they build tailor-made games to help brands creating powerful connections with their audiences + collect data of each player.
Here's an example of a project developed for Reebok Colombia (Cardi B campaign): https://www.pixpik.games/reebok/
What would you have liked to know before starting your company?
Applying the lean startup methodology would have saved me precious time for sure. We spent so many hours, days, and months developing the wrong products or betting on the wrong solutions.
Try fast, analyze fast, correct fast, and repeat. Don't force what doesn't work and let the wind blow.
When you start a business, even with deep market research, you never exactly know what the reality on the ground looks like. So try it fast.
Bonus tip: be persistent.
What outsiders often fail to understand about your company?
Video games are just for male teenagers and are pure entertainment. That's wrong!
Average player's age is 35 years old, 50% of them are females, and they spend around 30 min every day playing games. With mobile phones, we all became gamers!
Video Games use interactivity and stimulate our senses through emotions. They are a very powerful tool to build cognitive skills, creativity skills, team building skills, leadership skills and much more.
They are also used in the medical field to treat illnesses like Alzheimer.
So, imagine the impact brands can make on their audience with games!
What's one thing you can keep talking about for hours?
Saying video games would be too easy right?
I guess, travels. Another easy answer. But it's true.
I've been traveling all my life and am always amazed by the crazy stories travels can create. Knowing people, lifestyles, cultures...
Travel stories are definitely a source of creativity for Pixpik’s games.
What’s the weirdest job you’ve ever had to do?
When I was 20, I was sent to Hong-Kong to do a market research for a bakery project.
I went there alone and had no idea how to proceed, and no idea how to deal with the culture and people.
I spent 3 weeks in HK and finally could adapt myself to the country. I met many people, did hundreds of meetings and eventually wrapped up the market research.
The result? The bakery decided not to enter the Hong Kong market. Did I make it wrong?
What makes you bullish on the Mexican startup ecosystem?
When I arrived in Mexico 10 years ago I could feel that many things were possible here, for lots of reasons. And I was right.
First, Mexico is full of passionate tech talents ready to grind to accomplish their dreams. People are hungry for success so you can "easily" build a team and start working on your ideas.
Then, it's perfectly located. It's like the door of LATAM. Mexico is an expanding market and is actually attracting many people from other LATAM countries (and now from the US too).
For the reasons mentioned above, US and European investors are now interested and invested in Mexican startups. It's also "cheaper".
Finally, I think Mexico has this "easy going" vibe which brings you the "I can try no matter if I fail or not" mindset. So people try and actually make it works!