Summary:
Gerry Giacomán Colyer and Diego Iván García identified challenges in company spending across Latin America.
Clara grew from $102,000 in revenue to $28.3 million in just a few years, becoming a unicorn.
Regulatory frameworks have not kept pace with the rapid growth of the fintech sector in Mexico.
Over one-third of Mexicans are unbanked, highlighting significant financial inclusion challenges.
There's a strong push for legislative updates to foster a more flexible fintech environment in Mexico.
The Emergence of Fintech in Mexico
Gerry Giacomán Colyer, with experience in start-ups and consultancy, identified a pressing issue: controlling company spending was a significant challenge. Along with his partner, Diego Iván García, they noticed that companies struggled with paperwork and outdated IT systems, especially across Latin America’s borders.
Seizing Opportunity
Recognizing a broader need beyond just high-growth start-ups, Giacomán Colyer states, “With the proper technology, we can achieve agility without sacrificing control.” The fintech landscape in Latin America is rapidly evolving, with Brazil leading the way in regulatory success, inspiring other nations like Mexico, Colombia, and Argentina.
Clara's Growth Journey
Their venture, Clara, which provides corporate credit cards and transaction monitoring software, experienced remarkable growth. From just 26 employees and $102,000 in revenue in its first year, Clara surged to $28.3 million in revenue and 340 employees by 2023, ranking as the second fastest-growing company in the Americas. Clara also became the ninth Mexican unicorn, joining other notable companies like Plata and Stori.
Paying with a Clara card © Clara
Regulatory Hurdles
Despite the promising growth, the regulatory environment remains a challenge. A law from 2018 aimed at supporting fintech has not adapted to the rapidly changing landscape, leaving regulators struggling to keep pace. Alvaro Vértiz from DGA Group notes, “They’re trying to manage a car that is at full speed.”
Financial Inclusion Issues
Many Mexicans still lack bank accounts, with over one-third of the population unbanked. Historical distrust towards banks, coupled with a significant informal economy, complicates the situation. Founders from Plata aim to enhance financial inclusion, believing in the potential of fintechs to shift the reliance on cash to digital solutions.
The Call for Legislative Updates
As the fintech sector evolves, there's a strong push for Mexico to update its 2018 legislation to foster a more flexible environment. Giacomán Colyer emphasizes the need for ongoing adaptation in the market, stating, “The evolution is happening. It’s a question of how much faster can it happen?”
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