Descubre el futuro de las finanzas en América Latina y el Caribe

The future of finance in LatAm & the Caribbean

O futuro das finanças na América Latina e no Caribe



Mexican fintech Clara is moving to Brazil. Here’s why

Aug 21, 2023

By Antony Pinedo

Gerry Giacomán, Clara’s CEO, explains the unicorn’s decision to bet big on expansion in Brazil, bucking a trend for fintech retrenching in Latin America


Mexican fintech Clara wants to strengthen its presence in Brazil and make it its biggest market next year, underscoring the potential of the South American country.

The fintech, which specializes in corporate expense management, is relocating half of its Mexican management team to Sao Paulo as part of the expansion plan.

“This move is a strategic one,” Gerry Giacomán, CEO and founder of Clara, told iupana by email. “Since having consolidated our product in Mexico, Brazil represents an opportunity for Clara to grow.

“This market has a very mature financial ecosystem that will allow us to strengthen our position.”

Brazil, with 214 million inhabitants and a mature financial technology industry, is one of the few countries in Latin America that has achieved truly broad uptake of digital finance products, such as instant payments (through its Pix system). It is also the nation with the largest fintech ecosystem in the region, followed by Mexico.

Clara has more than 8,000 companies as clients, across Mexico, Colombia and Brazil. In early August, Brazil’s Central Bank authorized Clara as a payment institution, allowing it to expand its range of corporate services, including digital accounts and other products that participate in Pix.

“With the strategic focus on Brazil, we will have the capacity to develop solutions that allow companies to operate with financial agility and clarity,” said Giacomán.

Clara hired Francisco Simón - an alum of Uber, Facebook and Microsoft - as a country manager in Brazil a month ago. Simón is tasked with expanding the client portfolio, in a country where Clara already works with companies such as Starbucks and Mapfre.

Clara achieved unicorn valuation in 2021 and since its founding has raised US$160 million in equity financing. The last round was in April, when it raised US$60 million led by the investment firm GGV Capital.

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How to compete in Brazil

Clara’s ambitious bet on Brazil comes as various fintechs in the region have cut short their regional expansion plans, driven by the need to trim expenses amid a slow economy and fewer venture capital investments.  

Instead, many startups are focusing on their home markets for growth. They have seen that internationalizing goes far beyond landing and setting up shop. Particularly in countries like Brazil, home to large local and foreign competitors. 

Treinta, a Colombian fintech focused on digital solutions for small businesses, acknowledges that landing in Brazil has been challenging. Beyond the language barrier, success requires in-depth market research, adapting its teams to the environment, and dealing with stiff competition. 

“One of the main challenges is to be top of mind for users, since the competition from local startups and fintechs is significant”, says Lluís Cañadell, co-founder of Treinta. 

“And there are companies that have a good reputation and that consumers trust them, so getting a foreign company to position itself is a challenge.” 

The fintech, with a presence in 18 countries across Latin America, landed in Brazil at the end of 2021 and has already added 1.4 million users in this market. Treinta’s presence in various markets has allowed it to have a broad vision of consumer behavior and regulation, a particularly important element in the Brazilian market, according to the co-founder. 

“This aspect is crucial for a foreign startup, since it is a constantly changing landscape in relation to laws and regulations related to finance and technology, which requires greater adaptation and flexibility in management and innovation processes. And this is a challenge,” he says. 

The potential of the Brazilian market has attracted global fintechs such as Revolut, Wise and N26 to compete, although with different results and slow launches due to the wait for licenses. While local alternatives such as Nubank or PicPay continue to grow. 

Almost 50% of Brazilians are already Nubank clients, according to its financial results for the second quarter of the year. This sets the bar high for foreign contenders who, like Treinta, want to grow in the country. 

“It has been a challenging process due to the competitive nature of the local market and this has required us to analyze and understand the dynamics of the user, both in consumption habits and in interaction with technology – in an environment of constant innovation”, concludes Cañadell.  

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