These entrepreneurs left PayPal, Amazon and Mercado Libre to create their own neobank
Grow Your Business, Not Your Inbox
Having a prominent career is no guarantee that your life will follow that path. The entrepreneurial spirit can appear just when you least expect it and becomes the axis of your decisions , even if you did not have that profile at first. That is the case of Gabriel León , or Gabo (for friends) as he likes to be called. He is a cyber engineer who has dedicated himself to producing financial services on various platforms and companies.
With an unusual profile in the business world, Gabo is a fanatic cap collector, he does not wear a suit and tie nor does he seek to enter the most popular rankings of businessmen. In his words, it is hard for him to be like that.
However, his professional career has led him to blend in and be an expert in his field. Gabo began working as a consultant at Accenture on financial services issues. There he met many of the banking institutions in Mexico and found his passion. Then he entered Prosa , a switch that connects all banks for credit and debit card processing. "I had to launch some functionality such as interest-free months, the migration of the magnetic stripe from cards to chips, among others," Gabriel explains in an exclusive interview for Entrepreneur en Español .
He was then invited to Mercado Libre to be a country manager for the payment platform (Mercado Pago). "We did a lot of things there for the first time, like accepting payments at convenience stores, months without interest online, and processing payments in real time."
Later he moves to PayPal , where he also performs many functions. A larger company, where he had the opportunity to meet his now partner at Oyster, Vilash Poovala . He and Adolfo Babatz decide to create Clip (who are now on their way to becoming a unicorn). They also invite you to participate in the company. “I left happy but a little nervous. I already had my girls, because after such big companies, going to the entrepreneurship part was a bit scary. But it was a very nice experience ”, explains Gabo.
But it doesn't end there. The list of companies that impact continues and would not be complete without the mythical and much coveted Amazon. He worked at the retail giant as a product manager for almost three and a half years. So that's when we ask ourselves, why would someone make such a drastic change? It was clear to him: it was doing something of his own, achieving something different in his country and turning his life around.
Currently, Gabriel León is the co-founder and CCO of Oyster . He is in charge of all the strategic projects of the company such as alliances, but he started in the operations area. However, the process was not going to be that easy.
Image: Courtesy Oyster
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The begining of everything
Everything comes from Clip. “When businesses came and opened their account to start accepting other forms of payment than cash, we found that many of them used their personal card to receive payments for their sales. In Mexico there is not very good financial education and people mix a lot. I have heard many stories from people who already had the money for the business rent, but then paid the son's tuition and no longer completed the other. Because they have it on the same card for personal and business life ”, says the entrepreneur.
Since 2015, when Clip was released, they understood it, but the tools did not yet exist in the country to launch something more sophisticated.
Although Gabo's track record sounds impressive, he is not the only one at Oyster with a great background. The CEO, Vilash Poovala , was also a participant in many of these cutting-edge projects that have changed banking in Mexico.
“After my partner was at Clip and PayPal , he went to Germany to develop financial products in Europe for large banks, but he kept going. He called me one day and said 'I got a lot of information about the market in Mexico, which is gigantic, it is twice that of Eastern Europe, in terms of business numbers in fintechs and SMEs. I had the opportunity to develop a banking platform and I would love for us to do something. '
At that moment, Gabriel was working and the Banorte card had just been launched by Amazon, which the entrepreneur remembers that in a matter of months they already had many accounts. “Businesses in Mexico are not well served by traditional banks, they are interested in large corporations or consumers because they charge you very high interest. SMEs are like abandoned. I said: this is the right moment ”.
So they started working at the end of 2018, put together their pitch and went to get investors. "Fortunately, we were fortunate to raise $ 14 million in a single round , which up to that point, had the record for the highest raising of a startup in Latin America."
Image: Courtesy Oyster
They built everything little by little from scratch. They developed their own platform that, according to Gabo, has super sophisticated European security standards, which allows it to give customers another level of trust. “For example, we are encrypting all the information by registry. In other words, the information is not all together in the same file ”, he explains.
Then they began to validate what were the main problems that SMEs face in the country. They did not copy some foreign model and brought it to Mexico, because the problems are not the same. In the words of the CCO: "what we did was see what businesses were suffering to manage their finances."
The problem of taking out an account
Even having contacts in traditional banking due to their professional experience, they did not have to stop at a branch, however, that does not mean that the process was faster or easier to have their business account. That took two months and to have a debit card that could be used and cash what they had saved, it took 20 months, with a large bank.
Thus they validated the idea in their own flesh of what SMEs face in Mexico. They started with the launch of a debit card for companies and currently, they already have different products that they offer to their customers.
“It cannot be that a business takes up to six months to open a bank account, when according to Inegi many of the small and medium-sized companies go bankrupt in that time of opening operations. What we did was simplify those processes. It is complex in general for issues of regulation and validation of documents, but very user-friendly ”, explains Gabriel. "We want them to focus on their business, not on administrative issues."
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How to become an entrepreneur
Many times, even if you have all the knowledge of your industry, that does not guarantee that you are a good entrepreneur or that you have things figured out. Gabo had already moved and ventured into the world of entrepreneurship when he moved from PayPal to Clic, “at that time it was a terror. You think 'what if it doesn't work?' But, we learned many things there. As an entrepreneur, unlike large institutions, you run into a wall over and over and over again. You have to develop too much tolerance for frustration, because when you seem to say 'I'm going to sleep today, everything went well', something happens ”, says the co-founder.
"The first time you face this, it scares you a little, but the second time you know that this is so." The entrepreneur explains that you have to focus and fix things from the beginning.
The school for the client
Through Gabo's career, he has learned countless skills, however, he emphasizes one in particular; Amazon's customer obsession. “After having experienced the company school, your life will never be the same again. Their culture is super tough, ”he explains. “You become much more concise and objective, and all that we learned we are applying now. It has been easier to define processes, we measure it through numbers. Amazon marked me forever. At Oyster we no longer have adjectives, only data ”.
"This time we have more control, experience and idea of what we are doing."
What does it feel like to see your product on the streets
Regardless of the industry you belong to, watching your business grow and knowing that you are doing something right is rewarding for any entrepreneur. Gabo told Entrepreneur en Español an experience. “It happened to me that I was in a business and the person who was paying took out his Oyster card. It made me want to hug him and tell him that I invited him ” , he said with a laugh. “I told her that I was very excited to see her, because I am the founder. He replied that it was terrific and you begin to feel that engagement with people ”.
They currently have thousands of clients, but that is not the most important metric for the company, but rather to see the impact they have on them and their business. “Participation is being very relevant with us. It is to see that people already recommend us, that there are already positive comments because they have already lived the experience. It is much more important for us to solve the problem ”.
“The growth is going to happen on its own. I have heard many entrepreneurs who say, 'I want to earn my first million dollars', because solve the problem for a million clients and it will be super easy, ”explains the CCO.
Is it really a new neobank?
Oyster is a neobank, a kind of digital bank (it is not a bank because they do not have a banking license as is), it is a fintech, a financial technology company that offers products similar to a traditional bank. Regulated by the National Banking and Securities Commission with a different type of license, which allows them to handle users' money safely.
They seek to have other initiatives that go far beyond what a traditional bank offers to provide a comprehensive solution for the financial part of the business. "The account solves a problem, but there are others that no one else provides and that is what we are exploring and how we can solve it," says Gabo.
Oyster that started with Gabo León and Vilash Poovala , today there are about 100 people working in the company globally in Nepal, India, the United States and Mexico. They are a Silicon Valley company, they were born in the United States but, for the moment, only focused on the Mexican market. They are trying to consolidate themselves and have a very robust and strong platform. Claro with expansion plans to Latin America in the coming years.
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In the Aztec country there are many companies that are dedicated to this industry, however, the co-founder of Oyster makes the difference in that they do not go for the consumers themselves, but for the entrepreneur who has his business. It is focused exclusively on SMEs in contrast to its competitors.
“We have seen that even though people have more than 35 neo-bank cards, they don't use them. So if you have seven million customers, but nobody uses them, it is useless. However, we are growing at triple digits month by month, that is, we are handling more and more people's money and that speaks of the confidence they have to be with us, that they are finding a solution to the problems they have ”.
"If we help businesses grow, businesses will grow with us."
“I can guarantee that we are going to have 20 problems in the remainder of the year, some due to our mistakes or those of our allies, but we are not here to blame anyone, we are here to solve, how we have the least impact with our clients, we compensate them if they are affected, that they realize that they are not just another number but that they are part of the community we are creating ”.
Image: Courtesy Oyster
When I asked Gabo what would you say to your potential clients? I was surprised by his unusual response. He declares that the company has an obsession with the customer, even when there are problems, he personally contacts them to solve it, which very few companies do.
“There are many clients who have faced problems and I look for them directly. This is us. The platform does not work without clients and if they do not feel protected and supported by their financial institution, they will not trust us with their money ”.
Gabo's financial advice
1. Completely separate your business and personal accounts
If necessary, assign yourself a salary and manage your finances in different accounts so that there are no complications.
2. Focus on the priority
The situation is complicated and it is difficult to think about expanding, but it is about consolidating and ensuring the survival of the business.
3. The right tools
Look for the best solution, the financial products that are really necessary according to your type of business. It is not the same for everyone. Some need a debit card, others a credit.
“The situation the world is experiencing is giving us the opportunity to help many businesses. When you start to see the results and that you really contributed something to other people, it feels like a father ”.