Subscribe
Share
Share
Embed
Finding affordable, convenient, and seamless access to working capital is challenging for small businesses in Brazil, but the gap must be closed. Host Amee Parbhoo talks with Suzy Ferriera, Founder and CEO of Dinie.
Fintech has the power to build a more inclusive world. Fintech for the People is about the innovators who are developing fintech solutions that reach the people who’ve been left behind. In each episode, we’ll hear from innovators who are creating financial solutions that bring every person the financial tools they need to grow their business, support their family, and build their community. Together, we’ll learn how fintech looks different in spaces and places where basic financial services are a luxury — and how solutions to address these challenges require a different level of creativity, empathy, and execution.
Fintech for the People is an Accion podcast hosted by Amee Parbhoo, Managing Partner of Accion Venture Lab – an early-stage investor in inclusive fintech startups. Learn more about Accion Venture Lab here. Episodes will be released in seasons, on a weekly schedule.
Amee Parbhoo (00:12):
Welcome to FinTech for the People. I'm Amee Parbhoo your host and the managing partner of Accion Venture Lab. Accion Venture Lab is a global, early stage investor in startups that increase access to financial services for underserved populations across the world. In this, our first series of FinTech for the People, we're showcasing five of our portfolio companies led by women founders. We'll discuss the founders entrepreneurial journey, the innovative products they're building, and how they believe we can make venture capital a more inclusive space. With that, I'd like to introduce our first guest, Suzy Ferreira. Suzy is the founder and CEO of [Jinie 00:00:54], an embedded finance company that enables digital platforms to offer instant and convenient financing to small businesses in Brazil. We're excited to have you with us today, Suzy.
Suzy Ferreira (01:04):
So super excited to be here with you Amee today. Thank you very much for the invitation.
Amee Parbhoo (01:10):
Of course. Well, before we dive in, tell us more about your background. Have you always been entrepreneurial and seeing yourself starting a company?
Suzy Ferreira (01:18):
Yes. That's a good question. I'd say probably I had this entrepreneurial DNA, right? I think most people coming from Brazil do have that and not because they choose to, but probably because we are... It's the nature of being Brazilian, right? You have to reinvent your own life. There are so many struggles. It's a country that obviously despite having so much wealth and resources and everything, there is a lot of difficulties as well, economically. So as a Brazilian, you always have to work towards building something. I did go in the path initially in the more like career path, right? Having gone to university, I did a law degree actually. I had this idea that I wanted to make social justice and I thought law was the vehicle for me to achieve that. But then within the law studies, I realized I was always inclined towards business, banking, financial services.
Suzy Ferreira (02:18):
I went on to do a masters at UCL in London, and then I specialized in international finance law. So I ended up just always getting more like the business side of law. So I was thinking of this career, right? I always had this dream of working in the largest businesses around the world being very like a global citizen and an executive, but what I found myself within those company, so I worked for [inaudible 00:02:45]. I worked for [ICB 00:02:47], all the largest banks in the world, but I found myself always trying to be the entrepreneur inside a big company. I always carved that position, but it was difficult. And again, going back to that background of being a Brazilian and seeing myself, my family, we were always entrepreneurial. My father was an entrepreneur. He owned or he built more than 10 different types of businesses, from agricultural businesses to water infrastructure, to radio stations, to food businesses, to gas stations, building real estate, everything you can think of my father has done.
Suzy Ferreira (03:24):
So I watched obviously very close. I was part of that journey of seeing him building small businesses in Brazil, being such a hero, but so many struggles. So then I'm in this massive banks. I work in the biggest companies the world, very global citizen. But within myself, there was this empty gap. I knew it wasn't my place, that I needed to be an entrepreneur because there were all these things that I knew that I've learned and I had this mission and ambition, I knew I could do it. So then eventually I made the leap of faith.
Amee Parbhoo (03:56):
That's great. And what a remarkable experience to see your father build these businesses. What interested you in the financial services sector? You mentioned working for a lot of these larger financial institutions. What did you work on previously and how did you eventually draw the line back to Brazil and to the needs of small businesses?
Suzy Ferreira (04:18):
I was always drawn to the business side as I said, even during the law degrees. Right. And then when I landed my first internship, I landed in securitization at the time of the crisis. So it was 2008. The world is collapsing because of credit, right? And credit that wasn't understood because they built all this very complex structures. And at the end of the day, the end consumer, the normal people were paying for the mistakes and the greed of banks. But anyway, I landed the job right there in the heart of financial services in the most questionable time for financial services. And to be honest, I was very much focused on Europe because I was living in London, but then my heart was in Brazil, my knowledge of Brazil. And I know that the biggest problem were in emerging markets, right?
Suzy Ferreira (05:04):
So I started actually collating all of that knowledge. Every time there was something different to be done within the bank, I would raise my hands. How do we use finance to leverage the growth of those companies? How do you even run a bank? Because I always wanted to participate in everything. But after doing that, I realized that we could actually be a bridge between capital knowledge and technology from mature markets in Brazil. So I saw this opportunity, let's leverage what I already learned from here and the connections I made here and the capital access that I have here, and let's bring it to Brazil. So that was the thinking. Another point that I always raise that is very important is how I perceive money. Right. When I was small, I thought money was a little bit of a negative thing. And as I grew and became more mature, I started accepting the power of capital. And that power for me was less about having the money and more about how can we use capital to influence the world to make big impact.
Amee Parbhoo (06:06):
Yep. Definitely agree with that here at Venture Lab as well of the power of capital to have impact. So let's turn to Jinie. What exactly does the company do? And tell us about that journey to start the company.
Suzy Ferreira (06:19):
So, as you mentioned, we work with SMBs, micro and small and medium businesses in Brazil, and we provide them with very easy and fast and accessible capital connected into platforms. So this small business are already... We are dealing with large platforms in Brazil, eco platforms, marketplaces. We are integrating to those platforms and we allow the small business that are already connected there to reach capital in a very fast frictionless way. For us, it's very important that we partner with this platforms because that's where we get to know the customer. So we don't actually have to go out in the market to acquire businesses. These businesses have already been acquired by the platforms, they're already operating the platforms and they're generating a tone of data. That's where they sell their products. That's where they manage their logistics. And why not? We thought, why not use those ecosystems, extremely rich ecosystem systems to build the bank of the future?
Suzy Ferreira (07:20):
So the idea came around this invisible bank. How can we actually transform them in the sense that these ecosystems, this marketplace has become the branch of the bank. And we plug in the bank as a capital provider as opposed to the interface and the product with the customer. And that is for us, it's all about the customer, right? Because we want the customer to have the best experience. I tend to say that what we're trying to do is to shake, to reposition the bargaining power from the hands of the banks to the hands of SMBs. And we can do that through this technology and through this different approach of making platforms, the bank.
Amee Parbhoo (08:00):
So much of what you're talking about is sort of what we talk about now in the industry is embedded finance. And that's a fairly new term, but it's been gaining a lot of attention recently. For our listeners who aren't familiar with the concept, can you tell us what this means? And to your point of being customer focused, what advantages it really gives a customer over those traditional financial institutions?
Suzy Ferreira (08:23):
Yes, it's... I love the fact that embedded financing kind of exploded. The whole concept became so trendy and suddenly everybody was talking about it because when we started in end of 2018, we were obviously pitching this idea, right? Of having platforms, we're going to be connected to the platforms and all the bank is going to happen embedded, oh, we didn't use the word embedded. We would say they would experience financial products within the platform and so on. And eventually, I think was towards the end of 2019, the term was getting quite big. So the whole thing was very good for us because suddenly solidified our vision. Right? Okay. We're not crazy here. There is a big market here. There is a massive opportunity. So what it means is instead of, if you are, let's say an SMB, a small business, and traditionally you would be operating independently.
Suzy Ferreira (09:17):
Your finances would be independent from your car business, right? You would be selling your products, you manager your people, and you would have this independent place where you run your finances and you go to. You would actually have to walk to a bank. You would have to walk with paperwork and try to right to open account. And even to open account is extremely hard. Even today, I struggle, we struggle that Jinie various times, and it requires all the paperwork, all the bureaucracy and so on. So we thought actually, what if they can, because they already operating those platforms, the platform already knows them, so [inaudible 00:09:54] has already been done. The platform already knows which products they sell, how much they are spending. There is all this 360 degree view of this SMB. Why not use that? Should streamline completely the process so they can open an account instantly, they can access products instantly, frictionless.
Suzy Ferreira (10:16):
So they experience the product in the context of their business. And the product is tailored to the specific characteristics of that small businesses. And this is super powerful. So we're not only talking about incredible convenience, super fast process, but also cheaper products. Because if you have the data, if you understand them, the risk is lower. And also you're able to then size the size of limits or the interest rates to the affordability of this particular customer. So for them, it's a no brainer. They don't have to do anything. The banking services are going to happen within that context. It's going to be convenient, fast and way cheaper for them. So it's a complete transformation for businesses.
Amee Parbhoo (11:00):
Which these platforms love as well. Right? It creates for them such a win-win proposition of being able to do more business on the platforms than they were able to before.
Suzy Ferreira (11:11):
Absolutely. We always say it's a win, win, win. Everybody wins in this equation. I got this thinking as well from the 2008 experience back then when banks were being questioned, reputation was being questioned. A lot of FinTechs started to appear back then, actually in 2008 in London, I remember the movement. And for me, it was this concept. It's no longer about relationship banking, it's about partnership banking. This is what I want to bring to market. I want SMBs to really feel they have a partner and you can only be a partner if you know each other, you understand each other, you are there for the good and for the bad times.
Suzy Ferreira (11:52):
So it's not just about a relationship like historical traditional banking relationship, which means, oh, when they say relationship banking means cross sell. And I know because I was a banker. So it means, okay, you've got to find a way of locking in the customer and try to sell as much as possible, as many product as possible to that SMB. That's the opposite of what we're doing. We actually don't want to sell what they don't need because that's going to destroy the entire value proposition and the long term future with Jinie as well. So for us is how can we partner with SMBs?
Amee Parbhoo (12:28):
So tell us more about the small businesses you ultimately are a partner to? What sort of businesses use Jinie services?
Suzy Ferreira (12:36):
So we have two profiles. We are able... In our proposition, we have focused on the SMB at the center. And that means we don't mind if you're an SMB that is buying or selling products, because we're designing this digital credit account from which if you are a small business buying from a [inaudible 00:12:54] like inventory financing, you're going to be able to use a Jinie credit and Jinie credit by the way, will being embedded in that platform as a payment method. So it'll be a very fast way for you to pay installments. So this is, let's say our buy now pay later solution for SMBs. But if you are a small business, for instance, that you are on a food delivery platform and you are selling all your products there.
Suzy Ferreira (13:19):
And we are seeing how your sales are evolving and we're able to, based on that sale, give you extra cash, like an over draft, right? So you can use for paying your employees, or you can open a new shop or to make investments that we help you grow, then our solution is embedded in the wallet of that particular platform. So depending on how we integrate, depending on the type of platform, we're going to have a product configuration that will be different, but the core of it is the account, is having this digital credit account that capital is accessible wherever they are at point of need.
Amee Parbhoo (13:58):
These effective partnerships with the platforms are so critical to the success of your business. And we know that you all, your team has done quite a bit of work to really refine how you build a value proposition for these platforms, how you prioritize partners, and also how then you efficiently onboard partners. What have you learned about how to secure these big B2B partnerships and how do you make them work in the long term?
Suzy Ferreira (14:24):
The way we thought about this was a risky way. I remember some investors were pushing, are you sure? As a startup, you want to go straight away selling to the unicorns. And we are thinking, actually these guys think like us, their platforms, their technology. They also are looking at massive growth. They have the momentum, they have this incentive to grow. And we thought instead of fighting for acquiring customers in the open cities and the open market, a huge cap, why not partner with them? Right. And also I have a B2B background. That's what I did my entire life in banking was based on very large customers. So for me, it was actually more natural to develop those partnerships, right? And we made it in a way that we have to be aligned.
Suzy Ferreira (15:13):
If you are a platform and all you want is to extract as much as possible from SMBs, because they already connected in your platform you just want to make more money, likely you're not a good partner for Jinie. We're good partners when incentives are aligned. So those platforms that actually... We believe in our growth because we are going to help SMBs to grow. And we're going to device products that will solve real pain points as opposed to just trying to get more money out of them. So having this alignment in vision and alignment in mission, and also the alignment on growth has helped us quite a lot to secure the right partnerships. And you also need to make it simple for them to start, right? If you are talking about integrations on day one, that is quite risky, because one, there is a massive investment that goes into even the decision making of building something or dealing with another partner and then invest infrastructure, technology teams and so on.
Suzy Ferreira (16:16):
All of that can become an obstacle to closing a partnership. So we have this no code approach where we run an [MVP 00:16:24] and there is no coding necessary because we can utilize all of our infrastructure. We use some of their infrastructure, some of our infrastructure, we have both brands together. And then once we've proven the concept and we can prove the traction and they say, actually, this is something I want and I can see tangible results, then we start an iterative approach for integration. And again, even when we get into the integration layer or the integration stage, we're talking about iterating it. So we start from places where there will be the highest value for the SMB, the highest value for the platform and the highest value for Jinie. For instance, SMBs love the fact that they don't have to share any of their data. They don't have to give us anything.
Suzy Ferreira (17:09):
They will just be pre-approved instantly. We offer them inside the platform, they don't have to do anything. And that's because we're ready integrated to the platform and we're receiving all the relevant data that helps us underwriting. Also, they don't want to bother so much with repayment. They have made their provisions, they know how much they borrow and they have a dashboard and they want this to be deducted directly from their revenues. So then we provide an integration for that as well. And then later on, we started to integrate other layers to be fully embedded in the platform.
Amee Parbhoo (17:41):
That's great. Yeah, so many of the challenges we've seen in the past with B2B partnerships and scaling them is change management. It's coming down to how do you bring partners on board to a change or a new product and I really love the thoughtful approach you all have taken to bring people on board, to bring teams on board and show that value over time. Shifting gears, one challenge that we've seen for early stage FinTech companies is securing the debt capital that's needed to achieve lending goals. What has that process been like for you all? And do you have any tips for other entrepreneurs on a similar journey?
Suzy Ferreira (18:19):
Yes. I remember funds and particularly in the US, they were very worried about that in the very early stages, but also on the other hand, Brazilian market is a market super mature in terms of the securitization deals. And we have a very engaged private market. There are investors that are looking for higher yields so they're investing privately through this funding structures in Brazil. So not necessarily we needed to convince a massive fund of... In the very early beginning, we could prove the concept by just going to this private investors, raising small rounds, let's say a million dollars and maybe start at 500 and then grow that to a million and then grow a little bit more. And once you proven the traction with those private investors, then you go into actual fund.
Suzy Ferreira (19:11):
So we didn't have... Everything was again, iterative, but we're basically starting small, showing traction, learning, taking that traction to a fund and then selling the idea. So I would say my advice is you've got to be patient, right? And you've got to show the skim of the game and you've got to get it out there, iterate, learn, show the learners, and then you go bigger. And then our first attempt with an investor, it was straightforward. It took a little while to set up that funding structure and to actually then move all the portfolio across to the fund. So there were difficulties there, and that's when you need to have an amazing team with you. And I was very lucky to have [Venices 00:19:54] having done that before for [inaudible 00:19:56] and so on. He also brought the experience [inaudible 00:20:01] as well. So I brought these guys to actually make that happen.
Amee Parbhoo (20:05):
Actually staying with the team you've built, we know that strong culture is so critical for startups to compete in a really competitive talent market, especially in your region right now. How would you describe Jinie's culture and how have you built that as you continue to grow and bring on new employees?
Suzy Ferreira (20:25):
Culture is a tough one, right? And I tend to say, and to think that culture starts from the founders. I have a very direct approach and sometimes people think that's not very Brazilian. We talk about this extreme transparency, obsessive about communicating, extreme ownership, being very bold. So I think it started with me being like that. And so, yeah, so in terms of culture, it's not that I want to impose certain culture, but it does come with founders, right? And as long as they know the reason of being direct and being this extreme ownership and extreme transparency is to get this vision to become reality and to get our mission, which is the most important. If you are not bold enough, you're not going to be able to change the world I believe. So this is very important right now is that we are bold and that we push hard forward because there are only obstacles on the way. There are lots of amazing things, but there are so many obstacles.
Suzy Ferreira (21:35):
So you have to be so resilient. And having this mindset and this culture really does help us achieve our goals. But also what is super interesting is that I also brought people with very different culture and different ways of doing it. Andrea, for instance, my co-founder, you know her, she has the heart of the size of the universe, right? And she's the most caring and supportive human being. So she brings all of this to offset some of my characteristics and complement each other in that sense, right? And I think opening up this space for this other faces, with this other culture to complement yours is very important. Oh, and by the way, another point of culture that is super cool that Andrea brings to the team, she's super positive. She only sees the positive. The world can be collapsing, you only see the positive.
Suzy Ferreira (22:31):
So this brings this real sense of family, caring. We are here together and life is beautiful and we're having a great time. So that's how we do things. And then we brought in Venices as well, because two ladies there, right, which is quite unheard of in a FinTech, two ladies founders, we brought in Venices to also upset a little bit of the balance. And again, he is very similar to us in the sense that he's always smiling, always happy and huge drive, but a very big heart as well. So I'd like to say as pushy and hard core sort of team we are to get things done, we also have this culture of being very caring and very warm towards people.
Amee Parbhoo (23:17):
That's great. Okay. Last question for you. Over the last decade there have been an increasing number of initiatives focused on improving access to capital for women founders, but we've seen as you know relatively little progress. So what in your mind should investors or others in the ecosystem be doing to help close that gap? What advice would you have?
Suzy Ferreira (23:40):
This is a tough one. It's difficult to say because it's not like I have the solution, right? I can lead by example here. One of the things that I did to build a business that would serve SMBs that were created and run by women was to ensure that I had another woman as a co-founder, right? So that's how I did it because I wanted our products, I wanted our experience, our tone of voice, I wanted all of that to include women. So I thought instead of just building anything [inaudible 00:24:17], we're building this SMB lending for women. I actually thought about that in the past because that was a massive driving force for me, was to give access to capital for women entrepreneurs. Then we thought let's do it in a way that it's more understated. It's more driven in the design of the product, design of the culture, design of everything that we do.
Suzy Ferreira (24:37):
There will be two women there that are thinking about it, that have their hands on it. So perhaps I would say the funds to have more women and substantially more. Another thing I think preconceptions, but again, very difficult to change, right, preconceptions and also biases, difficult to change. The way people are just geared towards thinking in a way like unconscious biases, right? So you go to a meeting and then you are women presenting... Their brain... I do feel that, I perceive that, that it changes. Sometimes some firms actually just look at my co-founder Venices when they're speaking and I'm the CEO of founder and I like this is interesting.
Suzy Ferreira (25:21):
And they're just looking at the guy and I'm think, wow, even women are doing that by the way, not just men. So this one is very tough to change. So I guess it's more on us to keep highlighting it, talking about it as you are doing right now. Let's just talk about it and never be silent about it. There is conscious biases and it does affect us. So this one is a very sensitive subject and difficult one. I don't have the solutions. I can just say that the way I did was to bring my co-founder and bringing more women into this game.
Amee Parbhoo (25:56):
Great. Well, thank you Suzy so much for this conversation, for sharing more about your journey, about Jinie, about your vision for the future. It's been an incredible conversation. Venture Lab is excited to be in this journey with you and we are excited for the future.
Suzy Ferreira (26:12):
Thank you so much, Amee. Thank you.
Amee Parbhoo (26:18):
Tune in next week, when we travel to India to hear from Pavee Ramanisankar, co-founder and COO of Anthem, an education focused FinTech that provides digital money management to educational institutions, and then layers on financial services for the broader ecosystem.
Speaker 1 (26:37):
When we think of classrooms, we think of students studying, teachers teaching, but we don't think of the tons of files that are lying in a registrar's office, or how people sign in and sign out, clock in, clock out, their attendance, or how the queues that form when they're going to pay the fee. So all of this is a very large part of the institution. That's not the first thing that they think about when you think about education. [inaudible 00:27:05] the pandemic pushed through a lot of curriculum and how classes happen. I think at Anthem we were ready to take over the larger unlooked at portions of the institutions that really was also craving for digitization.