David Arana, CEO of VEF portfolio company Konfío, recently participated in a panel discussion at the HSBC Global Digital Finance Forum alongside VEF CEO Dave Nangle, exploring investor-investee partnerships.
Based in Mexico, Konfío builds digital banking, payments and software tools to boost the growth and productivity of small and medium-size enterprises (SMEs). In a country of over 7 million SMEs, where only 3 out of 10 are estimated to have access to formal credit, Konfío’s credit-first approach has proven a success. Today, Konfío offers working capital loans, credit cards and digital payment solutions to customers.
In this video, David Arana and Dave Nangle discuss VEF’s investment in Konfío and the company’s the journey so far, highlighting some of the key characteristics of the market, including:
– Mexico is a scale market with a large, deep pool of SMEs, who are key to GDP growth. Despite this, the traditional banking system has long ignored the needs of SMEs, resulting in low levels of credit penetration.
– Mexico employs a unique mandatory electronic invoicing system which applies to all businesses in the country, where transactional data can be leveraged to facilitate customer underwriting.
Watch the full video for a focused discussion on the ins and outs of investing in and scaling a business in Mexico – available here.