Plurall, a new Colombian fintech founded in August last year and focused on the so-called solopreneurs (individual entrepreneurs), is preparing its debut now in April. The idea is first to create a waiting list so that, little by little, customers can have access to digital accounts plus working capital solutions up to COP 2 millones (around $535). The debut is anchored in an emblematic pre-seed round, announced two weeks ago: Plurall snagged $1.5 million in equity and $10m in debt financing from an undisclosed London-based equity and debt fund “with over $3 billion in assets under management and a portfolio of more than 90 investments worldwide”. The first working capital loans provided by the fintech will come from this amount.
According to Glenn Goldman, co-founder and CSO at Plurall, this is perhaps the first time in Latin America – and probably the world – that a startup is able to raise international institutional debt for originating its first loans. And although it debuts in Colombia, Plurall eyes all of Latin America.
“In Colombia, there are roughly 10 million small and medium businesses. About 8 million are totally informal, and 400,000 are actually incorporated. And then there is our target market, made of about 1.6 million folks in between: they are not incorporated, but they are registered within their Chamber of Commerce. That requires them to report a certain amount of information every year, like what kind of business they have, how much revenue they earned, how many employees they have, etc. That allows companies like us to offer them products because of that minimal registration level (…) We are focusing on the solopreneurs because they have the greatest need and tend to be the most ignored [by traditional banks and fintechs]. By figuring out how to serve solopreneurs and entrepreneurs, we are like a hybrid working between businesses and individuals, so we create a lot more value while solving a big problem,” Goldman told LABS.
Besides Goldman, which was the co-founder of US-based CAN Capital and is an advisor of several Latinx-founded fintechs), Plurall’s team of founders is made of Federico Gómez (former YaGanaste México, from PagaTodo holding), Monica Saavedra (former head of products at Movii), Natalia García (former market and growth manager at Movii), Martha Fajardo (former Novo Payment and Fiado, and now CTO at Plurall) and Gustavo González (former product and platform director at BNPL fintech Referencia).
Plurall will provide working capital loans and a digital account to its customers in its debut. “The only people making money issuing cards is card issuers. The way of really creating active users and revenue is through credit. And we realized that this is really the most basic and mission-critical product for our target customers. That’s why we decided to offer a digital account, plus credit and a Visa debit card upfront,” said Goldman, stressing that Plurall is able to do something like this without having to go after expensive licensing processes because of the fintech ecosystem development in Latin America in recent years, as well as the regulatory environment and, therefore, Banking as Service partners like Powwi, through which Plurall is going to offer its loans and digital accounts.
The idea is to have Plurall available for all customers in September and, shortly after that, to incorporate a credit card and B2B Buy Now, Pay Later solution to its portfolio. “In the first year, we’re targeting to have something around 40,000 customers. And [before going to other markets in LatAm] we expect to have 120,000 customers. We’re now raising our Series C round [to be able to do all that].”
The fintech ecosystem in LatAm: What took 15 years in the U.S., took five in Brazil, and even less in other countries
As someone who explored the beginning of the fintech ecosystem in the U.S. in the early 2000 and is now an advisor of many Latin American fintechs, Goldman says that what is happening in the region right is very similar to that time, but all is happening faster here than it did in the U.S.
“I became CEO of my first company [Can Capital] in 2001, a pioneer of the merchant cash advance, which is lending to small businesses against their future sales. Today, Clip offers that product in Mexico, BizCapital offers it in Brazil; it’s a global product. But, see, in 2001, we had to do everything ourselves; we even didn’t have CRM; Salesforce didn’t exist. In 2016 I was introduced to a group of interesting guys that were looking to launch an SME neobank. I met the three founders; they didn’t know anything about credit, or about fintech, but they were really smart. They were BizCapital, one of Brazil’s greatest SMEs neobanks today. But the thing is: it wasn’t until 2016 that I realized that what was starting to happen in Latin America was very similar to what happened in the U.S. in early 2000,” Goldman recalled.
“What took us 10-15 years in the U.S., to have things done, took five years in Brazil, and three years in Mexico, and it is happening almost overnight in Colombia, Chile, and Peru. And that’s because the entrepreneurs in LatAm are amazing students of what has worked in other markets. Brazilians learned what happened in the U.S., then Mexicans learned about the U.S. and Brazil, and so on. They’re the third generation of entrepreneurs and they’re using that intellectual capital.”