Startup Spotlight #169: Zwapp
Zwapp was founded with a mission to connect millions of Latin Americans to new economic opportunities.
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Alan Colmenares was born in Atlanta, GA and grew up in Reading, PA. He graduated from Lehigh University with a BSEE. After working for several startups for 5 years in Silicon Valley, he decided to spend a year in Colombia, from where his parents hail.
Alan ended up taking up residence in Bogota, Colombia, working at companies such as Compaq Computer, Intel Capital, Oracle, and BBVA. At BBVA, he was part of a two-member team responsible for the acquisition of a Mexican payments startup called OpenPay, which is now the cornerstone of that bank’s payments strategy in Latin America.
In 2011, Alan launched two chapters of the Founder Institute idea accelerator from Silicon Valley and advised a number of startups such as 1Doc3, Kiwibot, and Tappsi. In 2019, Alan decided to launch Zwapp with some colleagues from Tappsi.
Zwapp offers companies an easy way to reward people who, in turn, appreciate access to a new source of disposable income. Given that, according to the World Bank, 210 million Latin Americans live on USD $10 or less a day, this new income is quite welcome.
Users download an easy-to-use mobile app through which they receive points. The app is a full-fledged mobile commerce platform where users can redeem points by selecting from a list of more than 30 vouchers that are used as credit when purchasing groceries, restaurants, phone top-ups, utilities, among others.
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Startup Spotlight: Zwapp
Problem: Most companies in Latin America still reward people (e.g., workers, partners, etc.) using paper vouchers. During the pandemic, this simply became unwieldy and an easy-to-use, digital method was urgently needed.
Market: Companies in Latin America pay approximately $20B in fees for different methods of rewarding people.
Solution: Zwapp offers companies an easy way to reward people by having them download a simple mobile app from which they can redeem points. Merchants are able to use the Zwapp Marketplace as an additional digital channel for their products.
Team: In addition to Alan Colmenares, two product developers (Jose and Oscar) and the company's Customer Success executive (Julio) formerly worked at personal transportation startup Tappsi. Strengthening the product team, the company added a back-end developer (Ana) from the country’s National University.
Colmenares: We’ve been successful at listening to our customers and convincing them to depend on a brand new platform for their rewards. Our top company has 9000 employees and depends on Zwapp for birthday gifts, sales and customer service incentives as well as many other initiatives.
Selling to customers is only one piece of the equation, though, and the team’s ability to build a robust platform that can handle processing thousands of transactions every month has been just as key.
Fortunately, our product team is extremely experienced at building world-class transactional platforms with mobile clients as well as a robust API for partners to connect.
Colmenares: Closing a bigger round would help us accelerate our product-led scaling objectives. Nonetheless, because the rewards market in Latin America is not as common in the states, it’s been challenging to explain why this space is such a great market from which to launch a new mobile commerce platform.
For US investors, this space seems optional, but Latin American companies make heavy use of this market because of tax advantages and their ability to use performance management strategies for spending scarce resources. Finally, by publishing a high-performance API, Zwapp is already working with partners to scale the Gross Merchandise Value (GMV) of our platform even faster.
Nonetheless, we have gotten great advice from Latitud mentors and are working on making our investor pitch clearer and more compelling.
Colmenares: My advice to aspiring entrepreneurs is to focus on making your vision come true by leveraging every strength that they might have and not dwell on any perceived weaknesses. In my case, I’ve been blessed with incredible angel investors that have been willing to invest in me and my vision. Additionally, I’ve been able to lean on the know-how that I’ve acquired throughout the years in a number of functional areas as well as a bit more self-awareness than I had in the past.
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Colmenares: Here are two founders you should check out next!
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