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Behind the idea: a55 | Fintech time

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Behind the idea: a55 |  Fintech time

2021 has been a pivotal year for crypto technology. Cryptocurrency trading volume grew 567% year-over-year to $15.8 trillion in value and demonstrates that digital asset trading has reached the mainstream. Although the market has seen some correction this year, 2021 has been such a Rubicon moment that no one can deny it: crypto-assets are here to stay.

So heIt’s perhaps no surprise that 2022 saw the launch of Latin Americas first crypto-debt transaction in the form of a blockchain-based financing model led by alternative lender LatAm, a55.

Hugo Mathecowitsch, founder and CEO of a55
Hugo Mathecowitsch, Founder and CEO, a55

We spoke to Hugo Mathecowitschcompany founder and CEOabout his move to decentralized finance and its innovative approach to financing.

Born in France and raised in Barcelona, ​​Mathecowitsch moved to Brazil in 2013 to take on a business development role in asset management. This is where his entrepreneurial spirit really took off.

He knew there was a future for him in Latin America’s booming economy, which led him to found the technology investment bank Amerigo. This venture ultimately failed, but gave Mathecowitsch invaluable learning and experience, which he applied to create a55 in 2017.

Five years later and successful funding rounds later, Mathecowitsch is still relishing the thrill of pursuing new ideas and building something truly new in a market he is deeply passionate about.

What has been the traditional corporate response to financial technology innovations nationwide?

To some extent, we are making capital market history here in Latin America with the first hybrid debt deal in Brazil. We were able to raise funds that wewill use to fund our own investments in businesses based on their current recurring revenue and alternative data.

ThisThis is not only important for the local market, but it paves the way for data-driven businesses around the world to leverage alternative data as a direct, enforceable and trusted source of collateral, using blockchain technology to unlock liquidity and finance growth.

How has this changed in recent years?

Access to capital, in general, has never been easier, especially for tech start-ups. Over the past 20 years or so, weWe have seen a global investment explosion. This exponential growth brings both risks and opportunities for businesses and lenders – we are already seeing evidence of this – but it fundamentally means that banks and the traditional financial sector are no longer the only sources of funding.

While weI saw sources financing is undergoing a transformation, we havet seen the same change in loans Criteria so far. a55 has been able to leverage new technologies to increase access to finance for businesses that were typically underserved by traditional banks, had limited access to equity financing, or were looking for an alternative to dilutive capital.

Was there anything that created a culture of change within the company?

Were an ambitious team and I think our appetite for innovation helps us maintain a culture thats receptive to change and constantly seeks to improve. Our clients also expect it from us – they count on us for this kind of out-of-the-box thinking that allows us to disrupt traditional models and make access to finance more accessible. I think our collective experience also contributes to change, bringing best practices from past companies.

What fintech ideas have been implemented?

In our underwriting stack, we integrated open banking apps, then open finance, and now open data apps to improve our SME-level revenue forecast. On the financing side, cryptocurrencies and the adoption of decentralized finance (DeFi) liquidity pools have been among the most transformational fintech ideas we have implemented recently.

What benefits did they bring?

I believe DeFi-based liquidity pools will be a major additional source of funding for data-rich companies in the future and will make hybrid debt the new normal for everyone.

For us, integrating stablecoins and DeFi liquidity protocols into the funding stack represents the best of both worlds – connecting decentralized solutions to traditional financial markets. And increasing the speed and efficiency of administrative operations through technology reduces the cost of cross-border transactions.

Do you see other industrial challenges on the horizon?

We expect blockchain technologies to massively disrupt traditional capital markets with the disintermediation of multiple parties including asset managers, distributors, trustees and trustees.

We also see challenges on the payments side with the continued compression of managed detection and response (MDR) services and the need to reinvent payments with services that add value beyond just processing verification by a third.

Can these challenges be helped by fintech?

Absolutely! In its simplest form, fintech is about finding and fixing gaps in traditional financial service models or streamlining processes that can be done more efficiently.

Improving access to capital, commoditizing data, and making smarter use of that data, both to improve the customer experience and to drive continuous improvement through artificial intelligence (AI) and machine learning, allow us to anticipate and remain responsive to challenges.

Connecting with the customer and applying technology solutions to meet, adapt and exceed their expectations is key to our approach.

Final thoughts…

With the growing demand for smart capital from a55 customers, our technology has enabled us to open up access to finance for businesses in the connected economy.

And given the size and energy of the Latin American market, II can’t wait to see what new developments this will bring. Also, to broaden our horizons beyond the Americas and into Europe with new global thinking.

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