In countries like Brazil and Chile within Latin America, the messaging app WhatsApp has skyrocketed in popularity for online shopping. It became the preferred e-commerce platform in these regions amidst the pandemic. Originally designed for messaging, WhatsApp’s use case has expanded, prompting a new venture, Mercately, to develop software to enhance the selling process on the app for brands.
Mercately, a B2B solution, is pioneering the development of necessary infrastructure for brands to efficiently sell through WhatsApp. It smoothly integrates with services such as Stripe and HubSpot, deploying AI assistants that streamline the process for brands to interact with customers, manage inventory, process payments, and handle orders directly within WhatsApp.
Henry Remache, Mercately’s co-founder and CEO, was inspired to start the company in 2021 during a project in Latin America. He was assisting a client in Ecuador to sell shoes on the e-commerce platform MercadoLibre when he noticed a significant majority (90%) of sales were happening via WhatsApp. This revelation sparked the idea that brands might benefit more from enhancing their sales strategies on existing platforms rather than expanding to new ones.
“Small to medium businesses in Latin America rarely have their own websites; they conduct transactions over WhatsApp,” said Remache. “Given that this behavior is so entrenched among consumers, our aim is to simplify the sales process for companies on this platform where their customers already are.”
Starting Mercately was challenging, given Latin America’s diverse market conditions, including different currencies and shipping logistics. Launched in 2022, the company now serves over 1,000 companies across 20 countries, boasting profitability with annual revenues exceeding $1.5 million, according to Remache.
“Our growth rate has been over 3.5 times year over year for the past two years,” Remache stated. “This impressive growth underscores the shift in businesses recognizing the need to adapt to consumer preferences, moving away from traditional methods like websites.”
The company recently secured a $2.6 million seed investment led by Inventus Capital Partners and SVQuad, with contributions from Techstars, Salkantay Ventures, and BuenTrip Ventures. The funds will primarily be allocated towards hiring additional AI engineering talent to improve their chatbot capabilities and expand their footprint in Brazil and the U.S., where they’re looking to increase their market share.
“Coming from Latin America, securing funding was challenging due to the scarcity of capital,” Remache explained. “However, our association with Techstars played a crucial role in opening up funding opportunities for us.”
Mercately also participated in Meta’s “Future of Business Messaging Platform” program in 2022, which led to its introduction to lead investors Inventus Capital Partners and SVQuad. These investors, originating from India — another country where WhatsApp is widely used — grasped the potential of WhatsApp-centric services in Latin America.
WhatsApp’s growing ecosystem is not only attracting startups like Mercately but also other ventures aiming to develop business services focused on communication and engagement through WhatsApp. Competitors such as Infobip and Trengo, along with potential newcomers, pose a threat to Mercately’s market dominance. Even Meta, WhatsApp’s parent company, could introduce similar business functionalities.
WhatsApp’s integration into Latin American society is significant, being used by more than 90% of internet users in the area. While the U.S. market for WhatsApp is still evolving, Mercately is poised to capture the growing interest in WhatsApp as an e-commerce platform.
“Just as Shopify revolutionized web-based e-commerce in the U.S., we aim to transform WhatsApp commerce in Latin America,” Remache concluded.
Compiled by Techarena.au.
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