Episode Transcript
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Speaker 1 (00:03):
Welcome everyone to
another episode of the Nearshore
Cafe podcast.
I'm Brian Sampson, your host.
First, I want to thank oursponsor, plug Technologies
PLUGGtech a great way to connecttalent from all over Latin
America to growing US companies.
If you're interested in theworld of fintech in Latin
America, especially Brazil, thisis going to be a great episode
(00:27):
for you.
I have Pedro GĂłes, the CEO ofPayTrack, and we're going to
have a great conversation.
Pedro, thanks so much forjoining us today.
Speaker 2 (00:34):
Hi Brian.
Thank you for the invitation.
I hope we'll have a good chathere.
Speaker 1 (00:39):
So as we let off
PayTrack, it's a really
interesting fintech that is forthe Brazilian market.
Tell us more.
What does it do?
What does the products do?
Who is it for All that stuff?
Speaker 2 (00:52):
So PayTrack is an
all-in-one solution for travel
and expense management right.
We help large, medium, largeand enterprise companies to
spend better their money.
So from the beginning when wehave booking travel so the hotel
, the flights, the car rentalfrom this part to the travel
(01:15):
until the last part where youhave to do the accountability of
the expenses related to thistravel and not only travels but
also some department spends wealso help the companies to
control, to manage and to havean easier way to do all of this.
As you said, as a fintech, wealso provide cards where the
(01:38):
company can use to manage and tospend their money.
So it's truly all-in-onesolution for Brazilian and not
only Brazilian but Latin Americacompanies.
Speaker 1 (01:49):
Interesting, so your
customer base is expanded
outside of Brazil.
Speaker 2 (01:53):
Yes, yes, we have
some customers outside from
Brazil.
First, of course, there wereBrazilian companies that started
to use PayTrack in other partsof the world.
As we are helping enterprisecompanies, this is really common
.
They have subsidiaries aroundthe world and PayTrack usually
is the solution for all thecompanies.
Speaker 1 (02:14):
Interesting.
If I may ask about currency,because it's much more
complicated when you havemultiple currencies that are in
the system and sometimes youhave volatility in currency as
well.
Can you talk about how PayTrackthinks about that?
Speaker 2 (02:27):
Yeah, actually, first
of all, PayTrack have to be
prepared to work outside fromBrazil, so our card solution is
able to help companies not onlyin Brazil but in other parts of
the world.
And when we think about acurrency here, actually we see
it more as a problem of ourcustomers, because the Brazilian
(02:50):
companies that are travelingabroad to do deals, to provide
services and stuff like this,that are suffering a lot
nowadays because of the value ofour currency, of real, which is
our money.
So we've seen it.
We've seen that theinternational travels have
(03:10):
decreased a little bit in thelast year, but unfortunately,
the the, the companies have todo their business and they will
have to travel again.
So it's not that good when youhave this thisurrence, you know,
as we have in it now.
Speaker 1 (03:26):
Yeah, I was going to
ask you about that.
You know, I'm the first to sayI think travel is recovering.
People are excited to go toconferences, they're excited to
visit customers, they're on alot more airplanes.
How did PayTrack navigate,covid that?
Speaker 2 (03:43):
was very very
turbulent.
First, it's true what you weresaying.
The companies and peoplerealize that of course, we can
do a lot of stuff like we'redoing now in a virtual space.
This is awesome, but there area lot of business services that
it's really important to beconnected with your customer,
with your partner, and you willhave to travel to be there
(04:06):
period.
And the companies are comingback and the volume of travel
inside Brazil is bigger than itwas before COVID.
So when we were at the COVID,people started to talk the world
will be completely different.
Nobody will touch each otheragain.
No, the things are coming back.
(04:27):
Companies are bringing theiremployees to the headquarters
again.
So we've seen this movementthat a lot of things changed,
but a lot of things came back tothe regular way, the normal way
, the way it were before.
So this is one point.
The second point about yourquestion PayTrack has a really
strong solution for expensemanagement, right.
(04:49):
So during the COVID, a lot ofthose big companies stopped to
travel, but they still had someexpenses to be managed.
As we are working with bigcompanies, they didn't stop
their operations.
Sometimes they were nottraveling by plane, but they
were using cars to get to thecustomer, to do the service and
(05:12):
stuff like that.
So of course that we wereimpacted as a company.
Our revenue had some damage,but as we have a good portfolio
as customers and theiroperations didn't stop, they
just changed it, we could helpthem to manage that money in the
other way, for example, evenhome office expenses, right.
(05:36):
So people were working fromhome and they had some resources
that the company gave to themand we helped the company to to
manage that.
With the pay track card, uh,and all the solution.
Again, we were, we suffered.
But if we look to to somecompetitors I have competitors
(05:56):
in one side of the marketbecause I have one side which is
travel management on that sidemy competitors went down 90
percent, eight, nine percent oftheir revenues.
There was no, no revenue streamfor them and I had all the
expense management and softwaresolution bringing money home,
you know.
So it was a time where we couldeven close a lot of big deals.
(06:19):
You know, because big companieshad a smaller operation, they
could change to a modernsolution like PayTrack.
So, as you could see, I triedto have.
Of course it was a huge problemCOVID and all the health
situation.
This is something terrible, butI tried to remember as a
(06:40):
business.
We suffered a lot here as acompany but I tried to have I
don't know a good point of view.
In portuguese we say to lookthe the glass.
Speaker 1 (06:49):
You know the glass is
full empty or half full.
Speaker 2 (06:52):
You know, I try to to
have this half full approach,
you know.
So that's it yeah, that's great.
Speaker 1 (06:58):
So your, your
business, is that a like a sas
model, like, uh, monthly peruser, is that?
Is that generally how you'rebilling your customers?
Speaker 2 (07:06):
exactly this is.
This is the, the first revenuestream, and we've got the second
and third one, which is, whichare related with the, the, the
travel services right that arebought inside of our platform,
like the flight, the hotelbooking and stuff like that, and
there is also a revenue fromour card solution.
(07:27):
So we have multiple sourceswhich help us to in a problem
like COVID, to be more prepared.
And of course, once that thingsgot normal we could be fast and
grow a lot, lot.
Speaker 1 (07:46):
So that's the story
of pay track those years yeah,
you know, here in the us, um,you know we'll hear about
companies like expensify.
You know that are maybe forsmaller startups.
There's obviously like mxtravel and things like that.
Um, for most companies that Ithink are small, that maybe
(08:07):
don't even have a software youknow they're using like Google
Sheets or something to Exactly,is that the same thing, like
they graduate from Google Sheetsto a company like PayTrack?
Speaker 2 (08:17):
Exactly that's the
same thing, and here in Brazil,
when we started eight years ago,we found even large companies
still using the Google Sheets,excel and stuff like this.
So it was a huge opportunityhere as a market and we started
as an all-in-one platform andnow, eight years after, we've
seen that a lot of expensemanagement solutions are
(08:40):
bringing travel managementsolutions or card management
solutions, and that's a reallyinteresting part of the history
that we are living in thismoment, which is a market that
is transforming, is evolving,and we are looking to this
bundle solution.
So PayTrack has a good positionbecause from the beginning, the
(09:03):
thought was to have all thepossibilities inside the
platform.
Speaker 1 (09:06):
Yeah, yeah, I want to
dive a little deeper into your
personal career journey, pedro.
Super interesting and you know,for those that don't know,
you're the CEO of the companybut you didn't found the company
.
So that gives like a reallyinteresting kind of insider,
outsider viewpoint and a chanceto bring a different perspective
(09:27):
to the business.
Can you tell a little moreabout you know how you got into
pay track, some of the differentroles you've had?
Speaker 2 (09:33):
yes, yes, so well, my
story actually starts, um, I
don't know, maybe 15 or 16 yearsago.
I started in a law school herein Brazil a really good law
school in Brazil, a universityright and after two years I used
it to follow some businessmagazines and you know stuff
(09:55):
like this.
And I read a book which iscalled in English it would be
something like letters to ayoung lawyer, letters to a young
engineer, stuff like this.
And I read a book about a younglawyer which he started his
career as an intern and at theend of the life he became a
really big lawyer here in Brazil.
(10:18):
It's a true story, and the firmthat he created was responsible
for M&As's big M&A's in Brazil.
And when I read that, I saw God, I want to do this, but I don't
want to be the lawyer.
I want to be in the businessside.
You know lawyers I don't knowif there is some lawyer watching
(10:38):
us.
Don't take it personal.
My father is a lawyer.
Sometimes it's not that cooland well.
So I changed it.
I started to study engineering,I went to France, I came back
to Brazil and I decided to havemy own company, my own startup.
Okay, now we're talking about10 years ago maybe.
And well, I created a solution.
(11:01):
I got some money and we createda solution to help companies to
understand their customersatisfaction.
But it was a solution for smallcompanies In Brazil.
They didn't have that pain.
So I learned in practice theidea of a nice to have product,
you know, or a vitamin not apainkiller and that was tough.
(11:25):
So I stayed almost two, threeyears in this project.
I had just a few customers andI realized that to have my
company or to be an entrepreneurin this technology area, I
should have more comprehensionabout really things that the
companies have.
So I decided to work in otherstartups that were maybe some
(11:47):
years ahead, you know, andthat's how I got Npaytrack.
When I arrived here we wereless than 20 employees.
I think I was 15, 16.
Okay, and I came here to helpthe company because we were
getting the first customers andthere was a guy doing support,
(12:11):
there was a guy doing theonboard and I would have to do
the customer success right, Moreor less like that.
And I arrived here and thefirst month they liked me, the
founders really liked me andthey gave me the support.
So I had one person in my teamnow I'm a leader and the other
(12:32):
two or three months I got theonboard team and things were
going like this.
One year later I had theopportunity to to structure the,
the marketing and sales teamsbecause from my from the company
that I started and PayTrack, Iwork in another startup, in this
meanwhile.
(12:52):
In this startup I wasresponsible for customer success
, but I worked with a productfor marketing and sales people,
right SDR, CRM, stuff like this.
So I have more or lessknowledge and I had the
opportunity here at PayTrack andI stayed almost three years as
responsible for marketing andsales and that was the time that
(13:16):
PayTrack really could find agrowth path, you know.
So it was a really amazing job.
I did it with a really niceteam.
The manager that was there atthe time is still here Now.
He is the director of salesdirector, right.
So I had a lot of good teamwith me and good people with me
(13:37):
and that was an amazing time.
After Dani, which is one founderand it was the CEO, she put me
to solve service problems.
Then she put me to solve thetravel agents problems.
So in five years, I run in Idon't know seven, eight areas of
the company.
(13:57):
I put them all together, Isplit them, I did a lot of crazy
things and at the end of 2023,she invited me to become CEO, as
the company was in a how can Isay it?
It's starting to become biggerand it would be important to
(14:17):
have all this KPIs process.
All this structure we should beable to put in the other areas
to keep growing, you know.
So that's more or less thechallenge.
So in 2024, my first year as aCEO.
(14:39):
We did a really strong job inthis part, so putting all the
areas in a more professionalperspective.
And also it was a year that wedid an amazing result as sales
in this part, so putting all theareas in a more professional
perspective.
And also it was a year that wedid an amazing result as sales
and also it was able to get ourpartnership with Riverwood, so
we had a deal with them.
(14:59):
They put money in the company.
At the end of the year thecompany always grew quickly and
always almost bootstrapped.
You know that's our story andnow we have more money to really
accelerate our growth path.
So in in three or four minutes,that's the story, my story, and
story of pay track a little bitthat I've been able to to
(15:22):
participate yeah, now, when youtalked about the founding of the
business and so interesting asyou took it from, you know 15,
20 employees and now we havealmost 400, almost 400,
incredible.
Speaker 1 (15:34):
Can you talk a little
bit more about um the funding
to get started?
So was it entirely bootstrappedor was there a?
Little bit venture money to getit off the ground.
Speaker 2 (15:45):
Nice.
So to talk about the funding, Ithink it's interesting before
to talk about the founders,daniele and Edson.
They are two entrepreneurs herein Brazil.
They are amazing people.
Edson is the product guy, theideas.
He had this view aboutall-in-one solution, bring cards
(16:05):
, bring travel Eight years ago.
Nowadays it's common, but hehad this vision there.
We have also a strongintegration with our customers
ARP HR solutions.
So that's also a little bit ofsecret sauce of PayTrack.
And Edson brought that from theexperience that he had before
20 years in a big ARP solutionhere in Brazil Okay company.
(16:28):
And the other side there's Dani, which is a really saleswoman
Wow, a powerful woman.
We say, like in Brazil, facanos dentes, when you put the
knife in the teeth, you know andyou go there and make the
things happen.
So these two people decided toabandon their careers in like,
(16:51):
in good companies, big companies, and started PayTrack with
their own money.
So during this time we one one,one small funding right during
this time, actually two smallfundings, but really small.
We all we always had cash flow,you know, but it was more
protection from them.
They put their money in thegame and work it a lot the past
(17:13):
eight years.
Yeah, we can't imagine how theywork.
So that's's what happened, andI told you this because what
happened last year, you know itworldwide, not just last year,
but last two or three years, theventure capital started to
realize that not all theprojects that have been sold
(17:37):
they know we're going to growseven times, 10 times, 15 times
our valuation is 15 times thearr.
And you know the crazy thingthat happened.
It slowed down and there werefew good companies in the market
and I think pay track was oneof them, because we always had a
consistent and a relevantgrowth, always in a more or less
(18:00):
break even situation.
You know, of course, at thevery beginning, the money of the
founders, but after a while wecould grow with our customers.
So that was something that itwas really good in in the point
of view of the, the funding youknow.
So that's what happened.
At the beginning of the year,we we weren't looking for
funding, we were let's do ourjob, we are growing, we have
(18:24):
cash.
But companies started toapproach pay track and I want to
understand, I want to know andand at the end of the year we
said okay, I think we've got agood partner now it's not only
the money, they have knowledgeto help us to improve our
management.
You know, and that's the way we, that's the path we took last
year.
End of the year.
Speaker 1 (18:44):
Yeah, I think that's
great.
I think all companies, whenthey have the preference, they
want smart money, you know, andadvice, connections,
infrastructure, all sorts ofthings.
And I wanted to ask you, pedro,just as you've seen probably
changes in the last, you know,eight to 10 years in Brazil.
You know we've had a few guestson that are VCs and they've
(19:05):
talked about the increasedopportunity.
More funding is going to Brazil.
We've had a practical venturecapital on.
We've had BBC Brazil VentureCapital.
Can you talk about, maybe, howthat's changed over the last
decade and are there moreinvestors?
Are there more startups?
Nice, what does that all looklike, nice?
Speaker 2 (19:28):
Well, brazil is a
huge continent, a huge country
sorry, it's almost like acontinent, you know and which
bring us to the fund, thefunding groups, bring an
opportunity mainly for b2ccompanies, so that, in my
opinion, that's what I've saw inthe in the first maybe five
years that you mentioned.
(19:49):
you said about last 10 years ifwe get the first five years and
even even after this, but it wasmainly b2c companies, because
Brazil is huge, any number thatyou put in the sheets, it will
be a lot of money if it works.
So I think that's where thetalking about VCs in my weekly
experience I'm not soexperienced, but in my point of
(20:13):
view that's the first part ofthe story.
And then, five years later, itstarted to achieve more in B2B
companies, also Brazil.
When we look about B2Bcompanies, it's easier to SMB
solutions.
So that's anothercharacteristic that we see here
(20:34):
in the investment.
Paytrack is a little bitdifferent because our product is
to medium and enterprisecompanies.
So it's a kind of differentapproach.
And I saw here in Brazil thesame thing that happened around
the world.
The last three years that Imentioned before, the VCs
started to become more I don'tknow more worried about high
(20:58):
valuations, so the deals sloweddown to understand if the
opportunities were real or not,you know.
So that's, I think, a quickreview what happened.
And now I've got some numbersworldwide.
It seems that this firstquarter it starting back to have
(21:19):
more, more deals and more moneycoming from from vcs.
Of course that a lot of this isis about ai solutions, right.
So?
So that's the new trend, that'sthe new buzzword and the money
is flowing over there and we'llhave to see what will happen in
this next, next, that, that thenext chapter of the story.
(21:40):
You know, the AI solutions, howthey're going to merge with the
existing business and how it'sgoing to transform the customer
life.
Speaker 1 (21:49):
Yeah, you know, the
other thing I wanted to ask you
about and maybe this is morelike broadly about Brazilian
culture is your perspective onrisk-taking.
You know, like you go to SanFrancisco and everybody's
entrepreneur, you know likethey're, you know, going crazy
Other side of the world, likeJapan.
You know it's much moreconservative and you know, make
(22:12):
the safe bet Maybe if you couldtalk about for those who've
never been to Brazil, you knowwhat that culture around
risk-taking and entrepreneurshipis like.
Really been to brazil.
You know what that culturearound risk taking and
entrepreneurship is like reallyreally good question.
Speaker 2 (22:22):
You know, because
when you, when you talk about
san francisco and what we'veheard here, you went there and
you have, or you had, access tomoney, you know.
So I'm not saying it was easy,it's never easy, everybody has a
tough job, that's not the point.
But it was easier to get moneyto start your company, to start
(22:44):
your ideas, to bring things fromthe paper to real life.
In brazil it doesn't happenlike this.
You have to first bring to realand have something.
Of course there were also casesthat people would do good
pitches and receive a bunch ofmoney, but that's not the
reality here in Brazil.
Here I see that theentrepreneurs are risk takers,
(23:08):
so they are people that reallyput their money, put their
effort, put their careers, youknow, in front of everything to
start their business, to try tomake something great.
So that's one point.
The second point here in Brazilwe have a government that
brings a lot of charge, a lot oftaxes.
(23:30):
It's not easy and if you wantto do something really in the
formal way, you will have to payit a lot.
Paytrack did it from thebeginning, everything in the
right path, but it brought tothe founders mainly a lot of
cash necessities for somethingthat doesn't change the life of
(23:55):
the customer.
You know it's money that you'regiving to the government and
the government doesn't help thatmuch.
I'm not talking about left orright.
In general, the governmentdoesn't help that much.
So I think that's the secondpoint that we have here in
Brazil.
We used to say here that thegovernment is like your partner
(24:15):
you're associated in thebusiness, you know Wow.
It's one partner that you'vegot, because 30 something
percent of your results you haveto give to them, so he's
associated with your business,you know.
Speaker 1 (24:30):
but he doesn't bring
anything, he just collects.
Speaker 2 (24:34):
So that's, I think,
the second point.
So people who start business inBrazil, they are a little bit
crazy, maybe because it's noteasy, it's not easy, yeah, it's
tough, yeah.
Speaker 1 (24:49):
That's an interesting
concept of the silent partner
that only collects.
Speaker 2 (24:53):
It's a silent partner
.
Speaker 1 (24:55):
Yeah.
Speaker 2 (24:56):
You're partners.
My company is me, Brian, andthe government.
33, 33, 33, 33.
Speaker 1 (25:02):
That's it.
I can appreciate that analogy.
I think that the government 33,33, 33, 33.
That's it.
I can appreciate that analogy.
I think that's great.
Tell us more about so.
I'm sure you know there maybewas even pressure at some time
during the journey to move thecompany to Rio or Sao Paulo or
even Florianopolis, but you'rein a city that not everyone
knows about.
Can you share more about thelocation and what's to grow in
(25:25):
that city, nice?
Speaker 2 (25:27):
So our headquarters
stay here in Blumenau, which is
a city in the south of Brazil,near from FlorianĂłpolis.
It's a really German city.
So we have the second biggestOktoberfest in the world and
it's amazing, Really good.
You have excellent beers hereand the company started here.
Actually, nowadays we have anoffice in Sao Paulo because we
(25:50):
understood that to be close tobig accounts, it would be easier
, it would be better for thecompany.
So we have 300 employees here,100 there.
That's the proportion and it'sinteresting.
Blumenau, it's this place of thestate, Santa Catarina State.
It's a place where it came alot of German in the last I
(26:15):
don't know 100 years.
They are a people that they arereally, really industrial
people, you know.
So they started companies, somecompanies 100 years ago,
companies that made T-shirts,that made bed sheets and stuff
like this.
Some of the huge companies inBrazil are from here.
(26:35):
So as those companies startedto grow, they needed some
technology solutions for the HR,for the arp, so bloom and now
started a technology pool, youknow, maybe 40 years ago.
And now the the people thatworked in those in those tech
companies tech companies fromthe other the other time started
(26:57):
to create their companies.
So edson edson, the founder, isone of that.
He worked 20 years in a companythat has 40 years more or less,
and he started his own company.
So it's interesting because weare from we're not from a
capital, we are from a smallcity, but for this story it's a
city that we have good tech teamtalents.
(27:20):
Now, to end this part of thestory, now we're starting to get
some pain points because whenwe look, for example, some
marketing specialists, someproduct specialists, some
enterprise sales, you start towe have to go remote workforce
or Sao Paulo or stuff like that,because we are reaching a roof.
(27:45):
So that's the story and thepoint that we are now.
Speaker 1 (27:51):
Sure, sure as we
start to close out the show.
Pedro, as CEO of a successfulFinTech company, as you talked
about implementing KPIs thingsthat more mature companies are
worrying about what kind ofadvice would you have for other
entrepreneurs, both in Braziland throughout Latin America,
that are trying to build a greatcompany?
(28:13):
What are maybe your top two orthree pieces of advice?
Speaker 2 (28:16):
Nice.
Two or three pieces of advice.
I think first of all they willbe like maybe common advices,
but focus in in sales.
Sales is is the first thingthat you, you know, have to be
looking to.
Of course, that you don't havea good product, you will sale,
you you'll do the deal and lateryou have the churn.
(28:37):
But it's much.
It's better to have thissolution and then you will build
a better product.
Then you don't have sales andyou don't even know that you
don't have a good product.
So at the beginning this is thefirst point you have to go out
and make deals period, that'sthe first thing I would say.
And after this, understand thatsales one part is really you
(29:01):
know run and put effort and putenergy.
That sales one part is isreally you know, run and and put
effort and put energy.
But on the, on the next phase,you have to put intelligence,
because you won't be able to to,you know, to go from 10 to to,
to 80 or to 50 or to 80.
You you won't be able just withenergy and and effort.
You have to put intelligence,you have to create a structure
(29:22):
that will bring you leads, thatwill qualify them.
That will you know.
So I think that's the secondpart, that you reach your roof
really soon after you discoverthe how to do the first sales
and, from the beginning, have agood crm, have a good you know
structure to understand what'shappening in this process.
I think that's the point andthe other parts of the company
(29:45):
you'll be able to solve afteryou're bringing everything you
solve when you have customers.
Speaker 1 (29:52):
I think that's great
advice and I think great
universal advice.
It doesn't matter if you're inChicago or Montreal or Brazil
right and try to start with agood CRM.
Speaker 2 (30:04):
start even you are
small.
Try to to start, you know,thinking big the sales, because
otherwise you're going to stopreally soon yeah.
Speaker 1 (30:14):
And that's it.
Amazing, amazing.
Well, pedro, this has been aabsolutely fantastic
conversation.
I've learned a lot aboutbuilding a real strong fintech
business out of Brazil.
Thank you so much for beinghere today.
Speaker 2 (30:29):
Thank you, brian.
Thank you, it was really good.
Speaker 1 (30:32):
Let me thank our
sponsor, plug Technologies.
Pluggtech Great way to connecttalent from all over Latin
America, just like Brazil, togrowing US companies.
Thanks again, everyone.
We'll see you next time.