Why we invested in Mendel
When I first met Mendel on the 8th of January 2020, I wrote a note to myself: “Not sure yet about the space — this team is amazing — follow them closely”. Already accepted into the YC Combinator without having launched a product, Alan and Ale were just starting to work together when I met them. Maybe one month later, we met their new co-founders Helena and Gonzalo — and we knew it was definitely a truly special team.
Almost one year later, after many meetings, and many stickers exchanged through Whatsapp, I’m truly excited to announce that we co-led Mendel’s Series A alongside the Fintech & Future of Commerce VC Infinity Ventures. ALL IN Mendel!
Here are some of the (many) reasons why we decided to partner with Mendel:
We believe that the corporate expenses management space is ripe for disruption, as large enterprises have been using Excel spreadsheets for decades and SAP’s non-flexible tools to follow up on their expenses.
Legacy banking and payment players are highly concentrated and offer solutions that do not fit all corporate needs. As a reference, American Express is only accessible to a small portion of the population in Mexico — less than 500k cards — and has developed a non-flexible product, thereby allowing just a small proportion of people among corporates to have a card.
On the other hand, the Mexican banking ecosystem is highly concentrated. Banks mainly focus on the B2B space for payroll management, payments, cash management, or working capital. They do not offer smart credit cards to manage B2B payments!
By deep-diving into this market, I now completely believe that the market opportunity for Mendel is huge, using payment as a commodity to win a much bigger play by becoming an invaluable tool for the CFO and managing all B2B expenses. Cherry on the top, the B2B payment market in Mexico already represents more than $1T annually but is still at the very early stages in terms of digitalization and optimization!
Mismanaging corporate expenses distracts companies from core activities, hence Mendel solves an immediate pain point for its clients, with important financial gains on the tax side
Mendel has built an intuitive and very useful product, by solving immediate problems for its clients. The company’s clients convinced us that Mendel’s software is tailor-made for them, with specific and unique product features.
Through many integrations and automatic tax-saving features, Mendel has added measurable value to its clients, with a strategy to start with one business unit, then expand to others. Some of its clients evaluate their savings in thousands of dollars, in only a few months. That’s the definition of product-market fit :)
We do believe that Mendel’s approach is unique on the market
New local players have emerged on the B2B corporate expense side recently, and yet, we’re convinced that Mendel has a totally different strategy. First, it starts with a different target market, that focuses on large corporate clients. Then, the product is different, simplifying inefficiencies rather than providing a payment card “per se”. Finally, this translates into a product with unique features: Mendel’s software fits particular big enterprise needs, with integrations to ERPs and invoice retrieval features.
Since its full product launch in June 2021, Mendel has been able to grow fast and with an impressive client base
Mendel’s payment volume was multiplied by a triple-digit number between July and September. Its client’s references have been unanimous on the product, pain solved for them, and on Mendel’s approach.
On top of that, Alan, Helena, Ale and Gonzalo have built a highly complementary team with fintech, B2B, payments, and tech expertise — and they form a truly extraordinary team
We believe Mendel’s team has the right components to win its market: Mendel’s team is experienced, scrappy, and highly complementary, with software, B2B expertise, and payments in their DNAs. On top of the founding team, Mendel’s ability to recruit top-tier profiles has been impressive, recruiting from American Express, Visa, Despegar, Konfio & others.
We’ve all loved working with the Mendelorians since day one at ALLVP and look forward to working through the next challenges together. If you wish to join a team that is scrappy, deeply committed, combining both clear technical craft and business savviness, don’t hesitate to contact them — they are recruiting ;)
PS: At ALLVP, we are actively looking to partner with amazing Fintech teams in Latin America, don’t hesitate to shoot me an email at cnovene@allvp.vc
