Mexico Gets a Ninth Unicorn: StoriBy Sofía Hanna | Fri, 07/15/2022 - 14:21
The fintech Stori, which seeks to democratize access to credit cards for the 80 million underserved Mexicans, received a US$150 million investment and reached a valuation of over US$1 billion. This makes Stori the ninth Mexican unicorn. The company will use this latest investment to grow its customer base, expand its product portfolio and begin expanding to other countries.
Stori, co-founded by Marlene Garayzar and Bin Chen and initially supported by three financiers of US and Asian origin, offers a credit card to those with no credit history, or a poor one. Its interest rates range from 69 percent to 99 percent.
Stori’s latest financing round was led by BAI Capital, Singapore’s GIC and GGV Capital, with the participation of Lightspeed Venture Partners, General Catalyst, Vision Plus Capital, Goodwater Capital and Tresalia Capital, as reported by Reuters. The company currently serves 1.4 million people but plans to expand its operations to other countries and broaden its portfolio of financial products, said Marlene Garayzar, Co-founder and Governance Director, Stori, in an interview with El Economista. “What we want is that, through access to this product, users can have a first or second chance and heal their credit history,” Garayzar said.
The service offered by Stori includes credit lines ranging from MX$1,000 (US$48.7) to MX$10,000 (US$487). The company’s loan approval rate is 95 percent, according to Bloomberg. In Mexico, over 90 percent of Mexicans do not have access to credit for multiple reasons, including the lack of credit history. However, the digitization of the sectors has increased the need to digitize personal finances.
With the latest Series C investment, Stori reached a US$ 1.2 billion valuation at a time considered complicated for startups. Inflation, rising interest rates, the risk of recession and global economic uncertainty has made venture capital funds more selective in their investments, but these challenges are expected to pass. “I am extremely confident that this phase will be overcome in the future. Maybe in the near future…. These unicorns are here to stay and will continue to change the world and create huge economic wealth,” said Jorge Francisco González Gasque, General Partner, G2 Momentum Capital, about investment in Mexican companies.
Despite challenges, the fintech sector has many opportunities, given that over 400 million consumers are still underserved by traditional banking.