Mexican Unicorn Clara Lands $150M Goldman Sachs Credit Line

The fintech will use the cash to weather the crisis while strengthening its finance team with a focus on mitigating risk

Card and corporate expenses fintech Clara received $150 million in a credit line from Goldman Sachs
August 08, 2022 | 10:05 am

Mexican unicorn Clara, which offers corporate expense management solutions for Latin American companies, has received up to $150 million in funding backed by Goldman Sachs.

The funding will allow the startup, valued at $1 billion after a $70 million round in December last year, to continue pushing the adoption of its corporate expenses management platform, currently available in Mexico, Brazil and Colombia.

The funding comes amid an uncertain context for startups around the world and in Latin America due to rising interest rates. Clara received the funding through a collateralized debt instrument, with guarantees. Debt financing becomes an option when venture capital is more conservative.

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“This new credit line will allow us to double our presence in Mexico while allocating resources to our regional expansion and new product development,” Gerry Giacomán Colyer, CEO, and co-founder of Clara, said in a press statement.

These debt funds are regularly used as growth capital and, if placed strategically, entrepreneurs can plan to reach certain milestones before capital rounds using these funds, which in turn will increase their chances of winning the equity round.

In Clara’s case, the funding will also enable it to offer short-term liquidity solutions to its corporate clients. The company currently works with more than 5,000 companies across its three markets and aims to double that number by the end of the year.

Giacomán told Bloomberg Línea that its product has the advantage of adapting easily to market conditions. “We understand the real needs of our clients, and based on that we can grant products and credit lines that satisfy their operations without compromising their resources.”

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He says this funding represents the confidence that international investors have in the potential of technology startups and the future of the sector in Latin America, even at a time of great challenges for its development.

Among Clara’s investors are Coatue, General Catalyst, DST Global Partners, monashees, and Kaszek, which has allowed it to become one of the youngest unicorns in Latin America, just eight months after its foundation.

Overcoming the crisis

The crisis has led many startups to instill financial discipline. Clara has even cut costs by letting go 10% of its workforce, “to consolidate its product in the countries where they are present,” the startup’s founders said last month.

Giacomán told Bloomberg Línea that the company has always focused on developing a solid and profitable business model based on strong technology infrastructure.

“With the help of our investors, we have developed more disciplined financial practices to maintain a profitable business,” he said.

With this new credit line, Clara also announced that it is reinforcing its team in the finance and risk area. In July, the company brought in Brazilian André Henrique Santoro as Chief Risk Officer. Santoro has more than 15 years of risk management experience, including his time at CitiBank and RappiBank Brazil.

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In addition, for the past eight months, Tina Reich, former credit director at American Express, has been working closely with Clara as a consultant. Reich is a risk management specialist and has led the data science, marketing analytics, and risk divisions at institutions such as JPMorgan Chase and Citigroup.

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