Headquarters: Venture Hive in downtown Miami.
Concept: Waleteros, the mobile banking app for the underbanked, offers a way for the more than 60 million people in the U.S. who don’t use or have a bank account to use their smartphones as their banking solution. U.S. Hispanics represent a disproportional percentage of this population.
Story: When Etienne Gillard moved to the U.S. from Spain two years ago, he realized that millions of people in this country don't use or have a bank account. In order to meet their financial needs, they rely on alternative solutions such as check-cashing stores that are time-consuming, extremely expensive and quite unsafe. Together with two friends with complementary professional experience, they decided to develop a mobile wallet solution that is cheaper, safer and more convenient than any other alternative, said Gillard, Waleteros’ CEO, who previously co-founded a language training company.
After completing a short registration via the app, users receive a Prepaid Debit MasterCard with no monthly maintenance, minimum balance, or overdraft fees. The card can be used to make purchases in stores domestically and internationally, online, and to withdraw money from a network of thousands of surcharge free ATMs. Through the app, users can keep track of their transactions and send money instantly to other users for a small fee.
Waleteros, part of the 2014 Venture Hive Miami Accelerator class, launched its app on Google Play on June 18. It plans to roll out an iOS version this summer.
“We are Latinos living in the U.S. and we wanted to find a way to send money for less than $10. And guess what? We did much better than that! Thanks to Waleteros, now anyone, regardless of whether you have a bank account or not, can send money anytime anywhere for only 75 cents,” Gillard said.
Management team: Co-founders Etienne Gillard and Sergio Carrera; Antonio Talledo, business development manager.
Number of employees: Six.
Financing: In March 2015, Waleteros closed a $600,000 seed round with angel investors from AGP Miami and others. The team plans to raise a Series A in 2016.
Recent milestones reached: Went live with app on Google Play on June 18; Partners with more than 100 independent cellphone dealers in Miami that are distributing Waleteros services. Raised $600,000 seed round in March. Upgraded its direct deposit solution allowing users to receive their payroll up to two days earlier than usual.
Biggest startup challenge: “Our biggest challenge is to be good at pushing the viral marketing snowball,” Gillard said. Goal: “1,000 happy early adopters!”
Next step: Running promotional campaigns in cellphone stores, taking part in events where potential users are gathering and being proactive on social networks.
Investor/advisor’s view: Thomas “Tigre” Wenrich was paired with Waleteros founders during the 2014 Venture Hive accelerator because of his prior experience owning a chain of brick-and-mortar check-cashing stores. Over the following four months as a mentor, he said he became very impressed with the team’s experience and product, and at the end of the program offered to participate alongside them as a founding investor.
“They have done a great job bootstrapping — which is important because the process from idea to launch has been an 18-month ride,” Wenrich said. “They have some innovative distribution channels to get the app in front of the people who need it, but it will take some time to build momentum. They are targeting a population that has a high penetration of smartphones, but it isn’t a group that is used to transacting online. Check-cashing store customers are generally very loyal customers, and the two biggest drivers of their decision-making are convenience and trust. Waleteros offers convenience in spades, but they will have to work on developing the trust of consumers.
“They need to find channels that already have consumer trust, where it will be easier to introduce them to this new and better concept for managing their money. That is the idea of partnering with independent cellphone dealers, and they have several other complementary channels that they will be testing soon. Once they gain critical mass, this should really take off.”