Searching innovation… go to the Innovators Summit in Brazil

Some weeks ago, Sao Paulo hosted the Innovators Summit Event gathering international and national speakers. This was the second year that the event took place in Sao Paulo. For one day and a half, attendants immerge in the new trends of innovation within an organization and within several sectors.

Technologies were presented and discussed during the event showing the potential that can be reached if we implement that in Brazil. The different panels were meant to induce attendants to look for innovation thinking outside the box and also learning how to boost innovation when you work in a big company. To sum up there is no more a reverse way, innovation has to be in our companies whatever the size and organizations need to learn how to accept it and seed this new state of mind in all the levels of the hierarchy.

Obviously, if we talk about new trends, panels about fintechs and blockchain have to be presented.

To start, we had the presence of Robert Schwentker from the Blockchain University. It is a university in California that provides blockchain related technical classes and organizes events for developers and the startup community. For beginners, the presentation was a great material to educate the public to the world of bitcoins and blockchain, in few words it is a sort of new internet where all transactions are transparent and we can ensure traceability and therefore safety. Several countries are creating new solutions using this technology and even the World Economic Forum recognized it as a disruptive technology of the future. Xapo and Ewally are South American examples of startup using the blockchain technology. In fact, Robert emphaticized that now we are going to the next level of the technology creating more complex solutions linking blockchain to internet of things or artificial intelligence for example. More organizations have realized the potential of this technology and companies as Citigroup has created its own cryptocurrency and consortiums were created as R3. Blockchain is starting to invade financial products (wallets, investments, merchants, financial data, payroll , insurance…) and big organizations cannot missed it anymore.

blockchain

Coinbase also spoke out at the event to depth in the discussion of bitcoins. Coinbase is a digital asset exchange company headquartered in San Francisco, California. It is a global leader in digital currency, and present in 33 countries. There are still some controversies about the real success of bitcoins but its volume and usage are growing globally. Sam Rosemblum, from CoinBase insisted that regulators will be the key drivers to accept the existence and advantages to use a digital currency. He mentioned for example Japan as a model about openness and acceptance of bitcoins and saluted Brazil regulators to start investigating and learning about digital currencies.

coinbase

Finally, there was a conversation with Kay Schmitz from IFC and its investments in Latam and Africa. IFC has performed high level investments in fintechs, by mid-2015, it had invested over $180 million in equity and debt in early- and growth-stage fintech companies around the globe and Latin America is becoming a more attractive place. Kay considers that in the next 5 years (maybe less) the role of banks will definitively change, going beyond credit and deposits…As a specialist of fintechs, he confirms that cooperation of banks and fintechs is crucial and productive to attend client  needs  (from millennials to baby boomers). In Brazil, he sees great potential on fintechs providing loans because the credit penetration is low in the country and has the highest net margins in the world.

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Kay points out Mexico as the second country of fintechs in Latam due to the size of the market and a high need of credit for all the population. Then he mentioned Colombia and Peru, emerging countries which focus on financial inclusion. To conclude, banks are confronting big challenges in the close future because digitalization is imminent but still do have a big number of clients that refuse or are in the transition period to stick to an agency. In addition to that, customers claim convenience and customization so banks have to invest in user experience too. How to find the balance between modernization and old structures? … Unfortunately, there is no a sole answer.

To finalize speakers recognize that Brazil has a special place in the heart of investors, (besides economics figures and political disappointment), it is quite difficult to not like this country. These are encouraging words for every Brazilian startup and a chance to not miss with international investors.

I would like to thank +Innovators and CI&T for the event because they did choose carefully the speakers and it is great to listen new points of view about the fintech environment in Brazil, its positioning worldwide and of course its potential.

Thank You +Innovators and CI&T and we look forward the next year with more innovations (certainly not yet discovered) in the agenda.

 

 

 

Viva Mexico! Viva!

With a population of 120 million people, Mexico is the Latin America’s second largest economy (growth of 2.5% in 2015). The country who is “so far from god and so close to the US” according to Porfirio Diaz, knew how take advantage of its strategic position when we are talking about Fintech.

Personally, I thought that being so close to the US could corrupt the startup culture in Mexico opting for the easy path and doing copy/paste of American solutions. I am happily surprised that it is not the case. Mexico has a tradition of innovation and creativity along its history and its entrepreneurs pulled out solutions from its own culture and reality to solve latent problems. So let’s roll out the carpet for Fintech.

In Mexico, 60% of population is unbanked and only 20% have a credit card. Fintech appears as the best solution to finally solve the unbanked issue. In a country where cash is dominant and people prefer to save money under the mattress, banks had real difficulties to get them on board. Fintech companies have great challenges in front of them: educate the unbanked people about financial services and give them confidence using technology.

In order to help them in this mission, several initiatives were created by international programs, accelerators and incubators. For example, Village Capital and Accion Venture Lab partnered with Mastercard Center for inclusive growth, Pomona Impact and United IT Consultants created a program to support entrepreneurs making financial services more affordable and accessible for Mexicans who lack access to traditionalU financial services. This program of three months started in 2015 and recruited 12 ventures. At the end of the program, two peer-selected enterprises received USD 50.000 in investment each. The winners last year were:

  • BillPocket: a payment facilitator for more than 5.500 Mexican merchants using their mobile points of sale.
  • Credilikeme: an online lending platform that uses facebook to reach, analyze and engage borrowers.

The inscriptions for this year were already closed and we are waiting to know the selected startups.

Accion Venture Lab is an investment initiative that provides seed capital and support to innovative financial inclusion start-ups improving financial access for people living in poverty worldwide. In his current portfolio, there are 4 Mexican startups:

  • Clip combines a card reader plug-in for smartphones with innovative back-end risk management platform to enable nearly any merchant in Mexico to accept credit cards.
  • Konfio is an online lending platform that uses innovative credit algorithms an alternative data analysis to help microbusinesses in Mexico who do not have access to credit obtain affordable working capital loans.
  • Salud Facil offers low income customers access to affordable credit to cover their healthcare and medical costs in Mexico.
  • Quippi aims to replace high priced traditional remittances to families in Mexico with PIN-based gift cards redeemable at local retailers (grocers, clothing stores, convenience stores…).

Fintechs also saw opportunities in the recurrent problems that Mexicans living in the US face sending remittances to the country. These solutions demand work and involvement in both countries. This is a door opened for Americans to be involved in the solutions, as partners or investors for example.

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Clip at the Venture Capital Conference – Alianza del Pacífico

 

BBVA, the bank that “embraces the disruptive power of Fintech” is present in Mexico and through its BBVA Innovation Center, or #Piso33, it organizes events to boost innovation and technology in the Mexican Community. BBVA Bancomer has disrupted the financial services market in the country with the launching of several digital products first (digital wallet or hiring car insurance through an app).

On September 2015, the Finnosummit took place in Mexico for the second year. 350 participants of the Fintech community attended to explore with the 25 international speakers the future of the Fintech industry. The final of the BBVA Open Talent in Latin America occurred during this event with 12 finalists, among them there were some Mexican ones:

  • Openpay has an API that allows companies to accept and end payment to clients and vendors through internet and mobile phones.
  • ZaveApp helps you to reach your goals saving money without thinking about. You save without fees, easy, quick and fun.

On 20/09/2016, we will have the third edition of the Finnosummit at Mexico City. For more information, you can click here.

This year, Innotribe announced its first partnership with SWIFT’s Latam Regional Conference (LARC) to harness innovation happening in the region. The event will be organized in Mexico City from 28-29th june 2016.  Innotribe will select 12 startups to enter the startup challenge, showcase their products at the event and receive expert coaching and mentoring. The three finalists will attend the SWIFT’s annual global financial services conference, held in Geneva where they will share the stage with Fintech experts and representatives from leading financial institutions worldwide. For more information please click here.

If we talk about Fintech, we cannot ignore bitcoin and blockchain, the technology that is disrupting banks. In December 2015, the laBITconf took place in Mexico DF, gathering more than 300 attendants and 40 international speakers as Andreas Antonoupoulos and José Rodríguez, from Bitso, bitcoin pioneer in the country. Bitso is a Mexican bitcoin exchange that has recently acquired Unisend Mexico in an attempt to become the leading bitcoin exchange in the country. The conference shows the involvement of Mexico in the international ecosystem of digital currencies. Bitcoin seems very promising as a solution for the Mexico’s remittance market and cross border payments.

To consolidate all the initiatives and activities happening in the country, in October 2015 the Mexican association of Fintech, “FINTECH México”, was created. This association intends to create a collaborative environment boosting innovation and also union in front of important actors of the ecosystem as regulators and big companies. With a focus on 5 key areas (education, technology, research, regulation and networking), they plan to make the Mexican Fintech community stronger locally and internationally. This week, the association was awarded as one top brand influencer at the Innovate Finance Global Summit 2016.

At the Venture Capital conference of the Alianza del Pacifico in March 2016, Mexico congratulated and encouraged for more work of the four countries (Chile, Colombia, Mexico and Peru) to attract more investments in the region. After all, the four countries together have a bigger market than Brazil.

Today, there should be more than 100 Fintech companies in the country but this number should grow quickly (in 2020, 63% of mobiles in the country will be smartphones). Mexico brings an ocean of opportunities for digitalization and innovation in financial services that we expect to really change the financial landscape of the country.

Mexico is “so close to the US” (easy access to US knowledge of Fintechs, international American speakers/influencers go easily to its territory, interest of American investors…) but above all is a Latino American country so he can play a leading role in the spanish speaking community.

We expect to hear more about Fintech Mexico activities and successful histories, especially related to financial inclusion. Because as Cristine Lagarde, IMF secretary, said once “Mexico can become the inspiration for the rest of the world to “dare to dream.””

 

Fintech_Mexico