Nelo Bets on AI Commerce With New US$100 Million Debt Facility

Financial technology firm Nelo is moving beyond its consumer-credit roots with an artificial intelligence-powered commerce ecosystem that combines e-commerce, payments, and embedded credit. The expansion is backed by US$115 million in annualized revenue and a new US$100 million debt facility from global alternative investment firm Victory Park Capital. 

The strategy, unveiled at a press briefing in Mexico City by CEO Kyle Miller, Head of Design Lila Miller, and Vice President of Finance Hiram Valdez, represents a broader shift in Nelo’s business model—from a standalone credit application to a two-sided marketplace designed to connect consumers directly with merchants and their inventory. 

From Consumer Credit to Commerce

Miller, a former product manager on Uber’s International Growth team, said Nelo’s business model was shaped by his early experience in Asian markets, where digital payments were already deeply integrated into everyday commerce.

"My first country where I worked was China. When I arrived, I saw a market that was super different from the only market I knew in the United States. In China, almost 100% of payments were digital payments, and people used digital wallets, not cards or cash. In China, there are companies that integrate payments, commerce, and finance into the same application," Miller said.

After working in China, Miller moved to India in 2016, where he saw another major transition as a traditionally cash-based economy rapidly adopted mobile wallets.

"I realized that the market in China—digital payments, digital finance—was going to be the future for all countries in the world. I decided with my co-founder Steven (Hebson) to find a market or country where we could help with that transition from cash payments to digital payments. We arrived in Mexico in 2019. Mexico is a very large market and it was, and is, a cash economy," Miller explained.

After five years focused exclusively on consumer credit, Nelo identified a new opportunity: connecting its growing customer base directly with merchants.

"We still have many consumers buying online, but to offer a complete experience and cheaper prices for products, we need to connect directly to businesses. With more consumers, we are going to have more businesses with more products and cheaper prices, and that means more consumers," Miller noted.

Building an AI-Driven Commerce Ecosystem

Nelo’s expanded product offering embeds financial services into the purchasing journey through three core products, according to Head of Design Lila Miller.

Tienda Nelo: The in-app e-commerce platform allows customers to purchase products such as electronics, footwear, and fashion through biweekly installments, without interest charges or an initial down payment.

"They make their purchase, select their biweekly terms, the product arrives, and only after it arrives at their home do they start paying. For our customers, this gives great confidence... so much so that one out of every three users makes their first online purchase in Tienda Nelo," Lila Miller explained.

Nelo Checkout: The checkout integration allows partner websites to offer Nelo as a payment option, with customers making their first payment only after their order is delivered. For merchants, the product is designed to provide an additional way to convert consumers making their first online purchase.

Nelo Capital: The company’s merchant-focused credit product provides affiliated businesses with credit lines to finance inventory purchases and support cash flow management.

The model also aims to reduce the cost of customer acquisition for participating brands. Valdez said merchants joining Nelo’s marketplace or checkout products face no upfront cost.

"For the brands that join our checkout or marketplace products, there is no cost. The new customers that arrive are a total benefit for them," Valdez stated.

Scaling Through Technology and Lean Operations

Nelo says its technology-driven operating model has allowed it to scale while maintaining a relatively small workforce.

"Today, Nelo has US$115 million in annualized revenue. We have 1 million active customers. We are in the top 10 shopping apps in the Google store, and we have been profitable for the last three years, doubling the size of the company every year," Valdez reported.

The company employs 45 people across Mexico City and New York City, representing more than 10 nationalities. According to Valdez, the highly technical workforce generates more than US$2 million in revenue per employee. "This highly technical team generates more than US$2 million per employee in revenue, which is a very strong metric," Valdez added.

The company expects that growth trajectory to continue. "We continue with doubling the business every year," Miller said.

Managing Credit Risk Without Revolving Debt

As Nelo expands its credit offering, the company says its risk-management strategy is designed to prevent customers from accumulating unsustainable balances. 

Valdez distinguished Nelo’s biweekly installment model from traditional revolving credit cards, emphasizing that customers have clear repayment obligations. "Our credit card and loans generally do not have any revolving balance. People know very clearly how much they have to pay in interest and principal. We have artificial intelligence models that allow us to predict people's payment capacity. We do not give them more credit than that capacity, and with us, a credit will never turn into a massive debt due to compounding interest," Valdez said.

The company also operates under a different regulatory framework from traditional banks and financial institutions in Mexico. Valdez described Nelo as an unregulated commercial lender and said the company is not subject to oversight by Mexico’s National Banking and Securities Commission (CNBV).

"Nelo is an unregulated entity. As a commercial entity that grants credit, we are not subject to CNBV regulation," Valdez noted. However, he said Nelo reports transactions to Mexico’s Tax Administration Service (SAT) for anti-money laundering compliance and maintains an internal compliance officer.

"However, we report transactions to SAT for anti-money laundering compliance. In that regard, we have an internal compliance officer and fully comply with what the authority requires. At this time, we have no plans to become regulated."