Mexico City-based Fintech startup Fondeadora has raised US$ 14M in a Series A funding round held in August 2020, led by Google’s AI-focused venture fund- Gradient Ventures. Y Combinator, Scott Belsky, Sound Ventures, Fintech Collective and Ignia had also participated in the funding round.
Gus Alvarez Moreno, Norman Muller and Rene Serrano founded the startup in 2018. Fondeadora offers digital banking services that are being used to eradicate the inadequacies related to the outdated banking system. The startup provides a free debit card linked to a robust app to save, use, and manage money. A mobile app and an international MasterCard debit card are one of its first products, and can be used by anyone to pay, store, and distribute money without difficulties.
Co-founder and co-CEO Norman Müller had earlier launched a similar crowdfunding platform in Mexico about 10 years ago, with the same team. That platform was also named Fondeadora, and almost 50% of card transactions failed in it, he said. Following a deal with Kickstarter, Muller and co-founder Rene Sarrano met again and introspected about the various problems they had encountered while running the crowdfunding platform. It soon led to the formation of Fondeadora part 2, a challenger bank that aims to improve the banking experience for people in Mexico.
Muller was quoted to say, “We acquired the bank charter, it was owned by a group of tomato farmers in Mexico. Twenty years ago, the government gave about 10 charters to create financial inclusion.” Subsequently, it launched its banking service. After opening a bank account without visiting a branch, one receives a Mastercard debit card. Individuals can choose whether or not they want to receive statements after each purchase, lock and unlock their card, send instant transfers to other users, and more. No monthly subscription costs or foreign transaction fee is charged.
In future, individuals will earn interest on deposits in their Fondeadora account. “We’re investing in government bonds, it’s a very secure type of instruments. In Mexico, you can get 5% or 6% interest rate,” Müller said. The startup could allot a small portion of deposits to medium-risk investments as well.
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