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The Mexican startup Palenca announced that they have raised US$2.6 million. They plan to use it to build a better employment data infrastructure in Latin America.
500 Startups, Y Combinator, Gilgamesh Ventures, Uncommon Capital, Moving Capital and Kima Ventures also participated in this investment round. Individual investors also joined, such as Gerry Giacomán, Co-founder of Clara; Courtney Mclogan, CEO of Runa; and Federico Antoni, partner of the investment firm ALLVP.
With this new capital, Palenca plans to have revenues of US$1 million a year and more than 100 clients in order to strengthen the team in the areas of sales and technology.
Palenca is an API that verifies the data of any worker – such as employment, income and identity – by connecting to employers’ payroll systems. The main objective of the company is to offer employees financial services such as personal loans, automobiles and insurance.
The company was created by José Carlos Aguilar, Pierre Delarroqua and Antoine Nguyen, who all previously worked at Uber. Initially, Palenca only granted loans to workers, but they noticed a peculiarity in the Latin American market: few people have a formal credit history and 90% of transactions in the region are made in cash, so most of the income is not visible in a bank account.
For this reason, the entrepreneurs decided to connect directly with employers to obtain potential clients’ information. Now, their business model is based on the monetization of these integrations with the platforms.
Since its launch, Palenca has integrated more than 40 employers totaling nearly 50 million workers. More than 30 companies are using the Palenca API in six countries: Mexico, Brazil, Colombia, Argentina, Peru and Chile.
Some of their clients are fintechs like Lana, employers like Borzo and PideDirecto, as well as insurtechs like Club.
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