Almost three years later and with three M&A operations under its belt, Open Co is consolidating its position as the largest unsecured credit fintech for individuals and small and medium-sized enterprises (SMEs). The company, the result of the merger between Geru and Rebel in 2021, bought BoletoFlex in December 2022 to advance in digital credit (or 'buy now pay later', BNPL) and, in June this year, merged with BizCapital, entering the SME segment.
Now, with the customer migration process almost complete, the company has just reinforced the top echelon in the areas of finance and brand management. Open Co is also going to launch a BNPL product for SMEs and intends to grow its 'credit as a service' (CaaS) business, inherited from BizCapital and BoletoFlex. The company has not yet ruled out entering into secured credit.
The information comes from Sandro Reiss, CEO of Open Co. According to him, the company already operates under two brands - Geru for individuals and BizCapital with a focus on SMEs - and is finalising the transfer of customers from Rebel and BoletoFlex at the end of the year.
"We haven't acquired any new clients for the two brands for months," says Sandro, who welcomed Finsiders to the fintech's new headquarters, inaugurated around two months ago in the Pinheiros neighbourhood of São Paulo.
In addition to the office move, the company has just hired Afonso Sugiyama (ex-Porto and SmartFit) as CFO. Rafael Pereira (co-founder of Rebel) continues as a shareholder, but recently left the day-to-day operation, handing over the COO post to ex-BizCapital Luis Felipe Sucupira. Open Co also brought in Fernanda Salgado (ex-Neon) to lead brand management in this new phase.
After three M&A operations and with R$650 million raised since the Geru+Rebel merger, Open Co's CEO has ruled out new deals in the short term.
"Our focus is more on growing and delivering results than on doing new M&A operations," says Sandro.
This doesn't mean, however, that the company's acquisition machine is switched off. "We are constantly endeavouring to identify opportunities for the future roadmap."
With a volume of close to R$6 billion in 'clean' credit granted to individuals and SMEs, Open Co is betting on a portfolio with personal loans, Pix in instalments and BNPL, through Geru, aimed at individuals. With BizCapital, the lines include short-term credit and working capital. "We'll have BNPL for SMEs," says the CEO.
Geru currently offers this product to individuals, under the name "instalments without a card". It works as a means of payment for purchases, with instalments of up to 24 times, both in physical shops and online. Partners include retailers, e-commerces, as well as service providers in segments such as education, health and others. In this sense, the idea is to bring this experience to SMEs as well, says Sandro, without giving any more details.
Open Co's CEO also sees an opportunity for the group's fintechs to enter into collateralised lending and financing. In his view, the new collateral framework paves the way for this, without the fintech having to be responsible for managing the collateral.
"What we don't want to do is something that requires the company to become a collateral manager."
In the world of credit card receivables, he exemplifies, there is already a "better environment" despite the turbulent start. "In real guarantees, it's getting better, but there are scenes of the next chapters with the new framework. And in payroll loans, there is an improvement in the operating infrastructure," says the CEO
According to Sandro, secured credit has space on Open Co's roadmap. The question is when it will become a reality. "We have things to do in 2024, but I don't have anything to say about that," says the CEO, when asked if there are plans to get into secured credit next year.
Even with the intention of moving forward with collateralised products, Sandro points out that there is a "very large pent-up demand" for unsecured credit in Brazil.
"Fintechs and digital banks together account for 9 per cent of the entire credit market," says the executive, who is also president of the Brazilian Digital Credit Association (ABCD).
With a macroeconomic framework of high interest rates and uncertainty, the executive says that Open Co did not seek to expand its credit portfolio over the course of 2023.
"We focused on serving the clients we already serve. It was a risk management decision," he says. For next year, in general, the CEO sees a "much better" year, after two years of shrinking supply. "It won't be a brigadier sky, nor will there be a credit explosion in the country because the accumulation of problems is too great."
On another front, Open Co has also been growing its credit as a service (CaaS) business. The fintech operationalises the entire credit cycle, from portfolio risk management to customer relationship and collection strategies.
"We deliver a credit process from start to finish, not just banking," explains Sandro.
According to the CEO, the client profile is diverse and includes local authorities, retailers and even financial institutions that don't work with unsecured credit. This line of business is in its infancy, and many of the projects are in the testing phase.
"We already have very large partners and a significant pipeline. We're in the process of creating cases," says Sandro. It remains to be seen what they are and how they evolve.
Almost three years later and with three M&A operations under its belt, Open Co is consolidating its position as the largest unsecured credit fintech for individuals and small and medium-sized enterprises (SMEs). The company, the result of the merger between Geru and Rebel in 2021, bought BoletoFlex in December 2022 to advance in digital credit (or 'buy now pay later', BNPL) and, in June this year, merged with BizCapital, entering the SME segment.
Now, with the customer migration process almost complete, the company has just reinforced the top echelon in the areas of finance and brand management. Open Co is also going to launch a BNPL product for SMEs and intends to grow its 'credit as a service' (CaaS) business, inherited from BizCapital and BoletoFlex. The company has not yet ruled out entering into secured credit.
The information comes from Sandro Reiss, CEO of Open Co. According to him, the company already operates under two brands - Geru for individuals and BizCapital with a focus on SMEs - and is finalising the transfer of customers from Rebel and BoletoFlex at the end of the year.
"We haven't acquired any new clients for the two brands for months," says Sandro, who welcomed Finsiders to the fintech's new headquarters, inaugurated around two months ago in the Pinheiros neighbourhood of São Paulo.
In addition to the office move, the company has just hired Afonso Sugiyama (ex-Porto and SmartFit) as CFO. Rafael Pereira (co-founder of Rebel) continues as a shareholder, but recently left the day-to-day operation, handing over the COO post to ex-BizCapital Luis Felipe Sucupira. Open Co also brought in Fernanda Salgado (ex-Neon) to lead brand management in this new phase.
After three M&A operations and with R$650 million raised since the Geru+Rebel merger, Open Co's CEO has ruled out new deals in the short term.
"Our focus is more on growing and delivering results than on doing new M&A operations," says Sandro.
This doesn't mean, however, that the company's acquisition machine is switched off. "We are constantly endeavouring to identify opportunities for the future roadmap."
With a volume of close to R$6 billion in 'clean' credit granted to individuals and SMEs, Open Co is betting on a portfolio with personal loans, Pix in instalments and BNPL, through Geru, aimed at individuals. With BizCapital, the lines include short-term credit and working capital. "We'll have BNPL for SMEs," says the CEO.
Geru currently offers this product to individuals, under the name "instalments without a card". It works as a means of payment for purchases, with instalments of up to 24 times, both in physical shops and online. Partners include retailers, e-commerces, as well as service providers in segments such as education, health and others. In this sense, the idea is to bring this experience to SMEs as well, says Sandro, without giving any more details.
Open Co's CEO also sees an opportunity for the group's fintechs to enter into collateralised lending and financing. In his view, the new collateral framework paves the way for this, without the fintech having to be responsible for managing the collateral.
"What we don't want to do is something that requires the company to become a collateral manager."
In the world of credit card receivables, he exemplifies, there is already a "better environment" despite the turbulent start. "In real guarantees, it's getting better, but there are scenes of the next chapters with the new framework. And in payroll loans, there is an improvement in the operating infrastructure," says the CEO
According to Sandro, secured credit has space on Open Co's roadmap. The question is when it will become a reality. "We have things to do in 2024, but I don't have anything to say about that," says the CEO, when asked if there are plans to get into secured credit next year.
Even with the intention of moving forward with collateralised products, Sandro points out that there is a "very large pent-up demand" for unsecured credit in Brazil.
"Fintechs and digital banks together account for 9 per cent of the entire credit market," says the executive, who is also president of the Brazilian Digital Credit Association (ABCD).
With a macroeconomic framework of high interest rates and uncertainty, the executive says that Open Co did not seek to expand its credit portfolio over the course of 2023.
"We focused on serving the clients we already serve. It was a risk management decision," he says. For next year, in general, the CEO sees a "much better" year, after two years of shrinking supply. "It won't be a brigadier sky, nor will there be a credit explosion in the country because the accumulation of problems is too great."
On another front, Open Co has also been growing its credit as a service (CaaS) business. The fintech operationalises the entire credit cycle, from portfolio risk management to customer relationship and collection strategies.
"We deliver a credit process from start to finish, not just banking," explains Sandro.
According to the CEO, the client profile is diverse and includes local authorities, retailers and even financial institutions that don't work with unsecured credit. This line of business is in its infancy, and many of the projects are in the testing phase.
"We already have very large partners and a significant pipeline. We're in the process of creating cases," says Sandro. It remains to be seen what they are and how they evolve.