Plaid for LATAM, Prometeo, Uruguay fintech, real-time payments, open banking, scaling fintech in Latin America.

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Welcome everyone to another episode of the Nearshore Cafe podcast. I'm your host, Brian Sampson. Today's episode is sponsored by Plug Technologies, Plugg Today, a great way to connect talent from all over Latin America with US companies. If you're a founder in Latin America, this is going to be a great episode for you. We're going to be talking to someone who has built a fintech raised capital and we're going to talk all about her journey and doing it. From Uruguay. Please welcome Zemena Aliman, founder and CEO of Promoteo. Great to have you.

Hi Ryan. Thanks for having me. Very happy to be here.

Well, I shared a little bit, just a little teaser on the intro about entrepreneur doing it from Montevideo, Uruguay. A lot of great stuff we'll talk about in the present, but I would love for our audience to get to know you. Could you take us from the start, you know, maybe university to today? Like, how did you get to where you are?

Wow. So, yeah, definitely. It was a long way. I major in journalism, which I always. It seems a little bit different from what I do right now, you know, being CEO of a fintech company. And so that's always seems a little bit unorthodox, you know, like a little bit different. I actually think that my background was a key asset for Prometeo. You know, at Prometheu, what we build is fintech infrastructure. We're somehow like rebuilding the foundations of the financial system. And so we are always talking out to things that usually go unnoticed. The infrastructure, you know, the financial sector. And so we, like, as human beings, like, we interact with money and so how the money moves from here to there more efficiently, more inefficiently, but we are not usually thinking about how it went from there to there, you know, and so like the flows, how they got done, they are invisible. And then the tech that powers those flows also go unnoticed. And so being able to translate that complexity into clarity, I think that that's something that I was able to do or I have been able to do because of this background that I have because of this, my background as a journalist, being able to somehow understand complex systems and navigate them. I think that perhaps what seems like a leap for me was a step which was, hey, like, I understand how this works, you know, I'm able to translate it and I'm able to talk about it. Would I be able to reshape this? You know, is that a possibility? And I think that when that sort of clicked inside me, it was like, at least I'll have to Try, I'll try to see if I can reshape somehow like these flows, how this works. And that's when I became an entrepreneur.

Yeah, that makes a lot of sense with the journalism because you're right, we don't think about, I think a lot of companies are built by engineers with engineer backgrounds and they think like engineers, they talk like engineers, they explain things like engineers, and they think everyone's an engineer. Right. So when you come from a journalism background, it's always who, what, why, when, where, you know the story.

Exactly. And, and I think that it's not only about the pitch, you know, it's not only being able to, to design a good pitch deck, you know, and a compelling blurb or elevator pitch, but it's actually like somehow I think that it goes unnoticed that we interact with reality because of language, you know. So language is the interface in which we interact with everything, even ourselves, you know. And so being able to understand that I think is capital, you know, And I think that that's the asset because basically if you're pitching a problem that hasn't been addressed or that somehow is new, you are creating that problem for someone else, you know, like someone else will notice that problem because you have addressed it through language. And so I think that having that expertise, it's really important, you know, because it helps you to, to. Yeah, to make it more clear, to make it more compelling, you know, and especially when you are building something from scratch and especially early on in the, in the startup, being able to attract people, you know, like make them gravitate towards your idea, that's very, very important and it's very powerful. And you only get to do that through language, you know, and with investors, with talent, with everyone. That's the interface. And so yeah, I think that's, and that's something that for me was very important from, from my background.

Yeah, I think that's great. Well, tell us more just about your journey, you know, how did you get to where you are today?

Okay, so basically I, as, as I mentioned, I started journalism, I went, I worked for a couple of years in media outlets in, in Uruguay and I got hired by this company, like this entrepreneur that wanted to build a digital spin off, like he, he owned publishing house and he wanted to build like a spin off that involved digital content, you know, and, and that was it, you know, like he knew that something will happen, it happened with digital content and that, that his company will have to shift towards that. And I was in charge of leading that endeavor and I, I Became like an entrepreneur, an intrapreneur. And I loved it. You know, like the, this thing, this very adrenalinic process of building something from scratch. And for me it was sort of obvious that I wanted to do that. And so after a couple of years, the business was stable. I knew customers, revenue, everything. So I decided, okay, I'll go for an MBA with focus in tech businesses. Because this is what I love. I'm in love with technology and I think that this new world is happening and I want to build something related to this, this new world. And, and I met my co founders, Rodrigo in. During the mba, I met Rodrigo and Eduardo who are my co founders. And we were talking about digital content, micropayments for digital content. And Rodrigo's expertise was cybersecurity in the finance with a sector he used to. His background was pci, DSS for financial institutions. And so immediately it was like, okay, payments and, and fintech wasn't even a word in Uruguay back then. I'm talking about 2014, 2015. And so, okay, this is like, it seems like a very interesting idea. We should explore it. And we started working on that, you know, like initially an idea brainstorming process, it became a digital wallet. We pivoted, and then we created a pfm, you know, a personal finance manager, very similar to Mint in the US to another equivalent in Brazil, which is called Giabolso. And we loved it, you know, like this powerful idea about providing financial education for micro entrepreneurs in Latin America. And while doing this, we understood that there was an infrastructure problem actually that was embedding us to build what we wanted to build, but at the same time that it was transversal to other, in other fintech verticals. You know, like, we all had the same problem trying to interoperate with financial institutions because Eduardo's skillset was very specific in the tech world. He was able to create APIs. So we were, we had the skills to solve that issue for our startup. But it became obvious that there was demand for that, you know, and even from financial institutions. Other, like large banks would ask us, okay, and how is that you are connecting and how are, how is that you are accessing this information? Can you use this information for this, for that? Like, and, and suddenly we were talking about interoperability. It was not about financial education, user experience, micro entrepreneurs. It was about pure tech, like the plums, you know. And so we said, okay, this is very interesting. We can somehow like, different from what we thought initially. We can still like fix this system with a new Infrastructure, you know, and for us, fixing this system with a new infrastructure was like the kickoff of Prometeo. That was the insight that drove us to build this API that aggregates, well right now more than 1,500 APIs from more than a thousand financial institutions in 11 countries.

Yeah, I want to talk about building From Uruguay in FinTech, which I have a few maybe assumptions or thoughts about Uruguay and you could tell me if I'm right or wrong and like how, how this might have helped. So Uruguay is a small, safe, stable country surrounded by big, loud, chaotic countries. People look to Uruguay sometimes as the Switzerland of Latin America. So the banks are just kind of different there. So tell us maybe about how you thought about your thesis and you know, building for Uruguay and FinTech and then, you know, the rest of Latin America is just different, bigger and maybe they have different financial issues or problems.

Well, you know, I think that for financial infrastructure applies the same that can apply for language. You know, we are used to think about, okay, Latin America, leaving Brazil aside, the rest of the region talks Spanish, you know, and if you go to Buenos Aires, you will see that the Spanish is very different from the Chilean one, you know, you have the Yapo and in Argentina is Bota. No, it's very different than Mexico Ora le. And each Spanish has its own flavor, you know, and for financial infrastructure it's the same, you know, so each country has its own financial infrastructure and so we are somehow like the last financial mile addressing the issues of that infrastructure, but then on top of it creating a standardization layer, you know, and initially our thesis was pan regional, you know, during the first two startups we were very focused in the Uruguayan market because they were B2C companies, both of them. But when it came to building Prometeo, it was, it was obvious that it was B2B. And of course like Uruguay is very small and the financial market is very concentrated with very few players. But because Uruguay is also so small, those players, they don't have budget for tech like deployments. They don't take even the decisions at the local level, you know, most of the decisions are taken by the like the headquarters being that in Spain or in Brazil or in the us, you know, wherever. And so like at the local level you have very like little flexibility, you know, and so the revenue opportunity becomes very, very small. And so for us it became like really obvious that if we wanted to build a huge company, we had to go beyond Uruguay. And so from the beginning of Prometeo, the idea was creating like this huge Layer of financial information, this highway of financial information and transactions. Our first customers were from Colombia. We moved right away to Mexico. You know, like, I was living there for more than, I think that nine months, you know, like, trying to understand how the financial infrastructure work in Mexico, how they would address open banking. They would. When, you know, like the revenue opportunity in that market. And then it was like, okay, where else can we find customers for this? You know, and we started integrating new countries. Panama, Peru. And so from the beginning, for us, it was all about building connectivity across the region. Because at Rometeo, we do not define ourselves as a payment company or a data company or a payment player. A data player, you know, we are a connectivity layer, you know, and so what we do is connectivity. We help companies to interoperate with the financial sector.

Yeah, could you talk about just the general Latin America, maybe banking ecosystem? And you know, I maybe like, my, my assumption is some countries and banks are much more closed off than others and how you might navigate that.

I think that there are a couple of things that are very interesting about the current, like the state of the art in Latin America in terms of financial technology. The first thing I think is usually like the first years of these fintech revolutions in the, of this fintech revolution in America were very focused into building financial inclusion. You know, like the problem in Latin America was that people used cash and they were excluded of the financial sector, both credit cards and banks. Okay. And so I would say that since 2011, 2012 to 2020, there was a lot that was, that happened that involved building inclusion, so making for people easy to access a credit card or a debit card, like power them with a wallet or a bank account. And I would say that Latin America did a great job in that direction because like, on average, we can talk about, like, we almost doubled the inclusion in the continent. Okay. And so that was a huge effort. I think that right now and like the last couple of years have been about understanding, okay, powering them with a credit card and a bank account. Is that financial inclusion? Is that it? You know, what else? You know, it's like, because in many cases they have that bank account, they don't use it. You know, they have that credit card because they are. But they are not using small and medium businesses. They keep using cash. You know, 80% of the transactionality goes over cash. You know, that's not an infrastructure. You know, how can we create a better penetration of digital payments? And I think that a lot has been happening around that, you know, and so right now you have real time payment systems in of course Brazil, which is Piggs, a huge success, you know, a huge success. The penetration was well, hypergrowth, you know, like I would say that any startup will dream with the metrics of success that Piggs has had, you know, and an amazing accomplishment from the central bank in Brazil, you have Spay. In Mexico, you have Breve. It's a pix like system that's been deployed in Colombia. Peru for instance, is doing something a little bit different, but equivalent, which is implementing upi, which is the Indian real time payment system, you know, the one from India. So they are taking it to Peru and implementing that, which is amazing. You know, it's like that will be something very different to what, what the rest of the region has done. You have open banking in Brazil, but then you have. And you have real time payments also in Argentina. You have open banking in Brazil, a huge success as well. Like the penetration of open banking in Brazil is better than the one in India or the1 of UK. So great infrastructure, fintech infrastructure in Brazil. And also there's an open banking regulation in Brazil, in Chile, which is being implemented as we speak. Okay. And Colombia has a draft that will get to a regulation hopefully soon, you know, but I think that is expected that towards next year we'll have like in place a proper regulation of open banking in Colombia. And so I think that overall the region has done a huge effort in order to mutate this infrastructure, you know, and taking it to the next level, understanding the complexities of the region, you know, and something that for me is especially using talking with US based people in Latin America. Credit cards do not have the penetration that they have in the US So it's not the same. That's why alternative payment methods are so important in Latin America and that's why the banking rails are so important in Latin America and have grown at the speed that they, they've had, you know, and so I think that we need to somehow like revamp this old legacy infrastructure from the banks to create this new layer of digital payments that complements the infrastructure from the credit cards.

Yeah, you know, two, two questions and they're a little bit different. The first is, as you brought up the US and there's a lot of US listeners on this podcast, is there maybe a company that has a lot of similarities to what you're doing, like maybe plaid or stripe or chime? Could you maybe talk about a US player that might, might be common to what you're. You're solving?

Yes. So I would Say that in terms of the infrastructure that we have built and the connectivity that we offer. Plaid definitely it's the benchmark. It's like. Okay. And actually we used to say like we are Plaid for Latam, you know, but because Latam works differently towards the US it didn't make sense to keep saying that, you know, because at the same time we are similar but we are not that we are another thing, you know, like something that has been done thinking about the, the needs of this region. And so that's why like PL for Latam doesn't apply, you know, it's a different thing. It's like another Frankenstein, you know. And so but I would say that the comparison applies then I think that in terms of perhaps like the go to market is more of a more treasury, you know, because different to Plaid, which has always been more consumer facing or more inclined towards small and medium businesses. Our sales motion is financial. Okay. So our customers are large financial institutions operating in multiple countries at the same time. And so we enable them with better infrastructure so they can reach with better products, their customer base. Okay, but that's also different from what Plaid does.

Yeah.

And so I would say that we are in there, in and in between. Our like the most popular use cases for Prometeo are account verification. So we are top of mind player in verification of payee in the region. We are providing verification of payee in latam and the U.S. we launched our verification of Payee products in the U.S. and earlier this year with name matching capabilities. And so being able to offer that in the U.S. you know, and that like standardizing this verification connectivity across not only Latam but also the US that for us is a huge milestone, you know, and then we also provide an API to automate pay ins and payouts in all of the countries that I just mentioned. Okay. And so I think that's something else different to what Plaid does or what mon treasury does is that of course we have a cross border angle to our payment solution. Okay. Which is basically being able to offer connectivity to our customers in the countries where they do not operate and help them to operate there.

Yeah, yeah, that makes sense. That makes sense. And then my other question is maybe just more of a comment on the state of inflation in Latin America. And by the way, like the U.S. has its own problems, you know. Yeah, yeah, yeah. U.S. certainly has its own problems. And there's, you know, I mean, you know, as I lived in Argentina a long time ago, you know, there's what the state says it is and there's what it really is, you know, the alternative realities. But it got me thinking about banking penetration, you know, and people wanting to trust banks and use banks and you know, you're not have a lot of control over that, you know, and, and inflation. But maybe just if you had a comment around banking penetration versus countries with high inflation, low inflation and how that maybe impacts your, your.

I think that doesn't impact our company as it is, but I think that definitely it was a driver for us, you know, a driver to build what we build. And this is something that I, it's very dear to me, you know, it's something very important which is core to my beliefs as an entrepreneur. Which is like in Latam we have like these issues, you know, inflation, devaluation, poverty. On top of that you have like of course money is scarce, you know, like it's difficult to earn money, it's difficult to, to keep the money, you know, because you all the time are spending on things, you know, trying to cope with your bad shit, you know, somehow make miracles turn of events and being able to pay everything that you have to pay, you know. And that's like daily life for an average person in Latin America. But on top of all of those things you have like this thing about the experience of money. You know, it's very hard to open a savings account. And so when you have savings like it's a nightmare navigating like the, the bank branch in order to open the bank account. And so if you want to save then you don't like the bank won't pay you a rate on the money that you've put there, you know. And so like it's not just like earning money but also saving money is very hard, investing is very hard, you know. And so it's not just like that overall money is scarce, but also that the experience with money is very hard, you know. And because everything that you will do related to money, it will be awful, not like painful, you know, it will become a struggle for you. And so I think that's something, and, and this is something that I always tell the team as entrepreneurs we won't have a saying on inflation, devaluation, poverty, you know that that's not, you know that that's another set of people that they, they have to, to like get that better. As a fintech entrepreneurs we do have a saying on reshaping like this experience money, you know, like making for people easier to have like all these experiences towards money and fill out money in a different way than they do. Right now, you know, and. And I think that those macros somehow, like, create this context in which, like, at least being able to. To solve that friction for people. I think that that's. That's very. It's challenging, but at the same time, it's very comforting.

Yeah, Yeah, I like that. On. On our podcast, we've had several VCs that have invested in Latin America. Some are based in Latin America, some are in the States. And for me, it's very exciting because I think 10 years ago there wasn't a lot of attention and, you know, new capital flowing in for. For entrepreneurs. I think it's wildly different today. There's a lot more attention. But I'd like to just focus on your specific scenario of at what point did you decide you needed to raise capital, you wanted to raise capital, and how did you think about that? And obviously you were successful. So if you have any advice for those listening on your own experience.

Yeah. And so when we started as an entrepreneur team, entrepreneurial team, with my co founders, with Rodrigo and Eduardo, like, fundraising wasn't even a thing in Uruguay, you know, very small market. There was like, there wasn't a busy ecosystem, you know, like, no one, like, no one knew, like, where are the investors? You know, like, how can I reach an investor? Where are they? Where do they live? You know, it was like, I don't know, you know, it wasn't a thing. It wasn't possible. For us, of course, we bootstrapped, you know, and for us, it was all about getting customers. Like, how can we get customers? The first two startups, like, that was our mindset. But then when we started building Perometeo, Mexico launched, like, this framework, which was the fintech law addressing open banking. And so we thought, okay, we, we should go definitely to Mexico, because we think that time to market there is more nearer than anywhere else in Latin America. And so we went to Mexico, and In Mexico, the B.C. ecosystem was much more developed. Okay, There was another maturity in the startup ecosystem, and we started talking with other entrepreneurs. And then it became somehow like, obviously that if we wanted to build something in the scale of what we wanted to build, something that would operate in 11 countries, you know, like revamping the financial infrastructure. If that was the scale of the. Of the. Of the vision, that vision needed to be powered with another scale of funding, you know, especially given time to market, given that the opportunity was now not in 15 years. And so we started fundraising, you know, and something that I'm always very honest about is the fundraising experience. Is very contextual. It's not the same for any entrepreneur, you know. And so my advice, I don't know, doesn't apply to all realities, applies to mine and to other that might find themselves in a similar place of the one that I was, you know. And so, yeah, I think that I've learned a couple of things along the way. I think that it's very important when fundraising to understand clearly the audience, you know, what's the investor mindset, you know, And I think that that's very important because you can understand how is it that they are like, like the boundaries, you know, like what is that they are thinking, you know, and. And I think that that's very important. And I think that there's something that I've always done that has played in, in my favor, which is like, basically never gave up on an investor that said no. Yeah, yeah, like, I don't know. The investor that led our precede, I talked with him for over a year. The investor that led our. I talked with him for, I don't know, like more than two years, you know, always coming back, always showing results, always showing like the level of execution that we could have accomplished, you know, and ultimately I think that that speaks for itself, itself. You know, when you reach a certain amount of credibility, you become like, unavoidable. You know, it's like, okay, there's definitely something here, and I think that that opens doors. It doesn't open all the doors, you know, but I think that it opens doors enough doors.

Yeah, I think that's wonderful. As we start to wind the showdown, I always want to give our guests a chance to talk about their home countries, home cities, for the sake of tourism. Okay, so tell us more about Montevideo. For those who've never visited, what do they have to do? When should they visit? What time of year? What should they eat? Tell us about. About that.

Okay. Amazing. Yeah, definitely. I. Well, I live in Montevideo. I love Montevideo. It's a very small city, very safe, very quiet, 1.5 million people. I think that number can create like it portrays what you can expect here. Not a crazy nightlife, not a lot of people, is not very cosmopolitan, but it's very calm. It's a city that you can come in order to relax, enjoy the seaside, a very beautiful seaside, enjoy the sky, you know, enjoy like walking peacefully in the city. And I think that after 30s, you reach an age in which you value all those things, you know, So I would say that it's plus. This is a plus 30 advice. And then I Would say that in terms of full. Great. Great meat. Great meat. Great meat. Ask for asado and we have a local sandwich that. It's called chibito. Ask for civito. And then in the last couple of years, great wines. Not only tannat, which is like the wine that is more popular in like from Uruguay, you know, like the one that usually characterizes us, but great white wines. Alvarinos, very nice Alvarinos that are being planted in front of the sea, you know, like near Punta del Este vineyards. If you like vineyards, you should go definitely to Punta del Este and visit local vineyards nearby. There are a couple of them. Vinaden de Garzon, of course. Alto de la Vachena, which is my favorite one. It's more an underground one, but I would definitely go there. Cerro del Toro. And I like wine, by the way. It wasn't obvious by now. What else? When it comes to sweet things, there's a local cake made with queen's jam that. It's called Pasta Frola. Okay. You should definitely visit a good bakery and ask for one.

Amazing. I love this advice. I can't wait to go back and try some of these things. Especially the white wine. I didn't know that was a special thing in Uruguay. I did not know that.

Yeah, a lot of Alvarino recently, Agustiardones, but especially Albarino is something that you can find like a very good quality wine.

Yeah, amazing. Well, Zemanda, it was my pleasure to have you on our show today. Thank you so much for being a guest.

Thank you, Brian. It was a very fun conversation. I really enjoyed it.

Good. Well, you're listening to the Nearshore Cafe podcast sponsored by Plug Technologies, Plugg Tech. Great way to connect your team with all the amazing talent in Latin America. Thanks again for listening. We'll see you next time.