Oyster closes $ 14 million seed round to accelerate its expansion in Mexico

Despite the fact that Mexico is the 11th economy in the world and one of the countries with the most exports, the vast majority of SME owners are still not adequately banked. Oyster, a financial technology startup founded and led by Vilash Poovala seeks to change this harsh reality for Mexican entrepreneurs.

Oyster has announced the closing of a $14 million seed round. This is the largest venture capital investment for a seed round in Latin America to date under the LAVCA umbrella.

The round is led by Monashees (Brazil) and SV Latam Capital (San Francisco), in addition to other investors such as FJ Labs , Fintech Collective , Kevin Efrusy , Redpoint eventures , S7 Ventures and Ulu Ventures.

The new funds will be used to accelerate Oyster's growth in Mexico and offer small and medium business owners a quick and easy way to access quality financial services.

Traditional banking in Mexico has not focused on providing financial services to small businesses. This has become a major obstacle to entrepreneurship and job creation in the country. Jobs that are urgently needed, as Mexico has been severely impacted by the COVID-19 crisis and more than half of the country's GDP is generated by small and medium-sized businesses.

New laws have recently been passed to address the lack of financial inclusion in Mexico. Among them, the Fintech Law stands out , which came into force in March 2018.

 This law, recognized as a pioneer in Latin America, has facilitated the adoption of the open banking system and has promoted the emergence of financial technology startups in Mexico. In addition, in 2016 the Mexican government approved a law to make it easier for individuals to formalize their businesses through a new regime called the Simplified Stock Company (SAS).

Vilash Poovala, co-founder and CEO, Oyster: "The arrival of this new incorporation regime, SAS, represented a great opportunity for us because the banking system in Mexico was not prepared to include them. We can open business accounts for all types of incorporation in 24 to 72 hours instead of the typical wait of 4 to 6 months (or even longer) that traditional banking offers. And, with the pandemic we are experiencing, who wants to spend hours in line at a bank branch instead of registering with us from their cell phone?”

In addition to providing quick access to business accounts in just 72 hours, Oyster also offers debit cards to its customers in less than 3 business days, something that could take more than a year for an SMB using traditional banking. Oyster's support team is available seven days a week and no transfer fees apply.

Consuelo Valverde, founder and managing partner, SV Latam Capital: “Oyster is solving a key problem and building something that is totally new in Mexico: a fast track for entrepreneurs and business owners to start generating profits and new jobs, in a way that the archaic banking system simply cannot in this moment. Oyster has the most experienced team in financial technology in Mexico, with an impeccable record in startups and global technology companies, including Visa, PayPal, Clip and Naspers / PayU. I met Vilash when she founded Clip, the first investment in our Fund 1. When she called to tell me about her vision for Oyster, I didn't think twice about signing the first check. "

Marcelo Lima, partner, Monashees: “Latin America represents a huge growth opportunity for entrepreneurs in the financial technology area. They can introduce new technologies that traditional financial institutions have failed to adopt, despite constant demand. The Oyster team has a clear vision, extensive technological experience and a very significant advantage point as it is the only neobank in Mexico with a robust BaaS, backend-as-service,  platform , which allows it to provide an experience extraordinary to its clients in Mexico.

Vilash Poovala: “Our vision is to be long-term allies of our business clients. First with quick and easy access to business financial services. Then, through the creation of innovative functionalities that help entrepreneurs maintain the health and well-being of their companies, as well as revolutionary products that integrate with Oyster's core offering and allow them to increase their profits."

www.oyster.io