Kickstarting a Payment Revolution

As recently as a decade ago, credit cards were a challenging proposition for Mexican businesses.

As recently as a decade ago, credit cards were a challenging proposition for Mexican businesses. Many didn’t accept them, and the ones that did had to acquire a separate terminal for every bank (and wade through the mire of bureaucracy that came with it). It’s little wonder that many small- and medium-sized businesses avoided credit cards entirely — and lost out on the potential revenue they could bring.

It was a problem Adolfo Babatz was familiar with. The former PayPal executive had a solution he wanted to develop, so he began raising capital in Silicon Valley. Babatz met with an aspiring venture capitalist named Consuelo Valverde to discuss the idea. Having been a businesswoman in Mexico, Valverde was already aware of the credit card situation and immediately saw the potential in a single device that could process credit cards from any Mexican bank. But the path from concept to execution proved rocky.

It wasn't an easy road for Babatz, CEO. Latin America, particularly Mexico, was not the hot VC market it is today. They had to stretch the raised capital as much as possible. Valverde owned a software development company in Mexico, so her team helped build the early versions of Clip's software in exchange for stock. Valverde later transferred her team of engineers to Clip. “That became my first angel investment,” says Valverde, who made Clip one of the cornerstones of her first fund when she founded SVLC.

In time, Clip attracted investments from Silicon Valley, becoming the first Mexican startup to do so. “At that point, nobody in Silicon Valley was looking at Mexico,” Valverde relates. That neglect made fundraising more challenging, but also increased the impact Mexican products could have. A few years later, Clip became Mexico’s first fintech payments unicorn. It also changed the way that Mexicans do business.

“Now it’s much easier for businesses to accept payments,” Valverde says, “and it empowered a lot of self-employed people to accept payments, so they could start businesses.”

Having her first investment become a unicorn was a welcome turn of events. But Valverde doesn’t ascribe it to beginner’s luck. “Chris Sacca has this phrase that I love: ‘It might be luck, but it’s never an accident.’

“I like to discover opportunities before others,” she adds. “And I continue to invest where others are not looking.”