How Simetrik’s Founder Pivoted from Fashion Ecommerce to a No-code Infrastructure System for Transaction Reconciliation

Reconciliation processes are not as cool as other business processes, but without them it is unthinkable to operate and scale any startup or organization.

A reconciliation process happens by comparing two or more sets of records to check that figures are correct and in agreement. In other words, it involves collecting and combining information from dozens of internal and external sources and putting this data into a single coherent database that allows organizations to make better decisions, increase efficiency, reduce costs and risks and improve governance and transparency throughout the financial process.

In the middle of the digital era, 58% of U.S. companies still run accounting reconciliation processes manually, and only 38% of finance professionals completely trust the accuracy of their company's financial data. That’s due not only to human error but also because of the vast increase in the volume of data flooding the business from a wide array of sources. Additional factors include over-reliance on spreadsheets, outdated processes and weak checks and controls across the information flow.

Getting reconciliation as close as possible to accuracy is critical to a company’s long-term operational and financial performance. The global reconciliation software market reached a value of $2.5 billion in 2021 and experts expect it to reach a value of $5.8 billion by 2027. Startups like Xero, Blackline, Trintech and Intuit have raised hundreds of millions of dollars to lead the way.

Alejandro Casas spotted the reconciliation opportunity for the Latin America market and pivoted his fashion ecommerce company into Simetrik, a no-code infrastructure that automates all the reconciliation processes of a company. The startup landed a $20 million Series A at a $100 million valuation a couple of months ago to become one of the main players in the reconciliation industry, globally.

From dropout to CTO

Casas began studying Systems Engineering in Bogotá, Colombia, in 2008. As time passed, he remembers going to fewer and fewer classes and spending more time on solving daily problems he had by using technology.

“I built an app to find people to play sports with; a discount platform for local restaurants; a carpooling solution to and from University; and a party promoter app. I have to confess that at the end I didn’t graduate from college because I started learning how to do real things,” Casas told The Org.

After dropping out in 2012 he met Alex Torrenegra, a successful Colombian serial entrepreneur, through a local accelerator program. Torrenegra saw in Casas an outstanding talent and invited him to do an internship with him in San Francisco for his company, Bunny, a voice-project fulfillment platform. “I accepted Torrenegra’s offer but with the condition that I wanted to work in marketing,” Casas said. “I realized that building digital products was way more difficult than just building the technology.”.

Casas not only learned how to execute and scale a digital product from the marketing perspective, but he also got what he calls the “Silicon Valley mindset,” one that encourages entrepreneurs to think based on opportunities and not risks, that leverages growth through bootstrapping and venture capital and embraces a global vision since day one.

After Bunny, Casas moved to Barcelona in 2014 where he completed a Master in Interactive Apps Design in Istituto Europeo di Design (IED) and landed a job as CTO at Mesfix, a Colombian fintech that connects companies with investors through crowd factoring.

Playing the Y Combinator playbook

After two and a half years at Mesfix, Casas decided that it was time to forge his own path. “I had no idea what to do, but I knew it was the moment for me to do it. So I decided to take some time and do some research on what I wanted to do,” Casas said.

Casas found Paul Graham's blog, which became his playbook, and sooner than later his fashion ecommerce idea called Ropeo started to get traction. “The first development we did in Ropeo was to build a 'web scraper' to download clothing store catalogs and upload it to a website. Whenever an order entered, I left my house, bought the garment and took it to the client,” Casas recalled.

In 2017, Casas pitched the idea to Santiago Gomez, who was then the Head of the Tech Accelerator Program for Endeavor, a global community for high-impact entrepreneurs. Gomez became one of the first angel investors at Ropeo, but he was so wrapped up in the idea and showed so much desire to move it forward that within a few months he decided to leave Endeavor and joined Casas as Ropeo’s co-founder.

With Ropeo’s monthly revenue at around $5,000 dollars, the founders decided to apply to Y Combinator. After their first attempt they became part of the winter cohort of 2018. “I was following Paul Graham's playbook in detail. The next step was to go to YC and that's what we did,” Casas said.

As happens to most startups, YC changed the course of Ropeo. The startup not only grew sixfold in four months, reaching a monthly recurring revenue of $30,000 dollars, but Casas and Gomez convinced themselves that the best next step was to build something completely different.

In the introductory sessions at YC, several startups began to present their companies, and Casas started to compare those business models against Ropeo. “There are business models that are better than others, period. And ours was pretty loose with a very large logistical burden,” said Casas. “We understood that we needed to build software that services customers alone. We should not depend on logistics and market fluctuations.”

As soon as they came back to Colombia, the founders called a YC mentor and told him that they were going to pivot. The advice the mentor gave them was to kill everything they had done so far and put all the effort in the new thing. And so they did.

Ropeo ended as a “garage sale” where they sold the remaining inventory to friends, family and neighbors.

Tell me your pain, and I’ll build a company

Casas and Gomez started to think of market pains that were more suitable to solve with software. Their first attempt was an expense management system.

At the beginning of 2019, looking for the first clients for the new startup, they realized that prospects started asking more and more for automated conciliation processes, a pain that they also experienced within Ropeo.

By that time, Colombian delivery unicorn Rappi, whose founders were close to Gomez, were having a real pain conciliating all the financial transactions that were running through their super app. When Casas and Gomez found out, they made themselves available to help solve the problem. “They were losing money and were having some growth blocks due to lack of control and visibility. We knew it was a huge opportunity to search for our product market fit,” recalled Casas.

Rappi opened their doors to Casas and Gomez and signed a three-month contract to see if they could help them solve the problems. Rappi’s contract was the beginning of what would become Simetrik.

Casas and a team of five took a transactional approach to the problem, and after mapping more than 250 different data points that were feeding Rappi’s database, came up with a standardized upfront layer that allowed Rappi to interact with all its data through a single language and a single platform, so they could consult all the information in an organized and reliable manner.

After an intense quarter of hard work, Casas and Gomez realized they had in their hands a perfect problem they could solve via software, and with that came new funding: Rappi’s founders invested $2 million in Simetrik’s pre-seed round.

Finding the 10x way

With a decent runway in the bank and a great client, Casas put himself in sales mode.

He managed to bring a couple of renowned local brands to the portfolio, such as Addi and Frubana, along with the ecommerce giant Mercadolibre. Although Simetrik’s product was more of a technology consulting service than a SaaS —- software as service product — like Casas has once imagined, the company was growing.

“With the first clients, we had to do very customized developments and basically sales happened because they trusted me. I closed the Mercadolibre contract by making a drawing of sticks and circles on a board. We were selling and resolving at the same time,” Casas recalled.

Starting in 2020, with good sales traction at Simetrik, Casas went to San Francisco to raise a new investment round. To his surprise, nobody was willing to invest in Simetrik given the simple reason that the level of customization the startup was providing to its clients made it highly dependent on human capital to scale. “They made us realize that to take Simetrik to the next level with the model as it was, we would need 1,500 employees. It was not a scalable business model, so it wasn’t an attractive startup for investors,” said Casas.

He came back to Colombia, but this time he was not going to start over—his new obsession became building a more standardized product for Simetrik, one that allowed the company to grow without the need of being human capital-intensive. “We were on the right track, we just needed the right car,” said Casas.

With COVID-19 starting to become world news, sales slowed but Simetrik’s focus didn't. Simetrik raised a bridge investment round with the main objective of building a more standardized and scalable software, and so they did. After a year, Simetrik 2.0, as they called it, a no-code infrastructure platform that allows to reconcile practically any business transaction in an efficient way, was ready for launch.

The market responded well to the new product, and important regional companies, like Mercadopago, Dlocal, Nubank, Ualá, Bancolombia, Banco Falabella and Oxxo became Simetrik’s clients.

Today, the startup reconciles $80 billion of TPV (total processing value) per year. It has 50 clients across 10 countries and is processing transactions in 28 countries. And all this is done by a team that does not exceed 200 employees.

“I can say that today, 9 out of 10 transactions made online in Latin America go through Simetrik. And this is only the beginning,” said Casas.

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