Truora, a Colombian User authentication startup, has raised $15 million in Series A funding co-led by two Silicon Valley-based venture firms.
Propel Venture Partners and Accel led the investment for Truora, which valued the company at $75 million when cashed.
Founded in August 2018, Truora originally focused on background checks for Gigster platforms. In 2018 and 2019, its biggest customers were ride-hailing companies, and with the pandemic, the company has seen a surge in e-commerce and marketplace customers.
Truora participated in Y Combinator’s 2019 winter cohort and soon after expanded into digital identity and authentication technologies. In March of this year, it raised $3.5 million in a seed round co-led by Accel and Kaszek, with a valuation of $15 million.
Today, Truora describes herself as a SaaS startup developing authentication and communication tools for Latin American startups, marketplaces, fintechs and banks. It specializes in user authentication and onboarding, mostly via WhatsApp.
The technology includes automated onboarding with features such as automated chatbot conversations, facial recognition, document verification, and background checks. In 2021, Truora launched its WhatsApp-focused Truconnect product to help businesses connect and verify users through a more accessible channel.
“We enable companies to increase user acquisition, reduce onboarding dropoff, provide 360-degree customer support, and even sell their services, with minimal technical requirements on their part,” said co-founder and Maite Munizwho serves as the startup’s chief product officer and is a former McKinsey consultant.
Today Truora has over 400 customers in 9 countries across Latin America. These clients include Rappi, Clara, Bancolombia, Adelantos, Mercado Libre, Didi, Homie and Global 66. It states that it performs an average of 400,000 to 500,000 validations and background checks monthly and generates over $4 million in annual recurring revenue, with growth of “over fivefold” expected next year.”
Co-founder and CTO David Cuadrado spent nearly five years as an engineer at Twilio, while co-founder Cesar Pino was an engineer with the company for nearly three years.
The company has offices in Colombia, Mexico, Brazil, Chile, Peru and San Francisco. While its headquarters are in Cali, Colombia, Muniz said that of Truora new focus or fastest growing office is Mexico City. In fact, the startup plans to use some of its proceeds to expand its WhatsApp onboarding offering, which includes features like automated conversations, in Mexico. After all, they also want to expand further in Brazil.
CEO and co-founder Daniel Bilbao says Truora aims to lower the barrier to entry by making its products available to companies with limited technical resources. He said Truora could be integrated into any company’s product in “less than two weeks”. According to Bilbao, integrating the most popular channel, WhatsApp, with a no-code flow builder takes less than a day.
WhatsApp is widely used across Latin America by an estimated 80% to 90% of the population.
“By enabling the integration of Truora’s authentication products with WhatsApp, the company opens up a potentially $3.5 billion addressable market in LatAm,” said Bilboa, a former investment banker at Bank of America.
Truora also plans to use its fresh capital for some hiring, insisting it wants to create a workplace culture “where women can thrive”. Today, 70% of the company’s leadership team and 45% of the workforce are women. The aim is to achieve 50% equal representation with more than 50 new positions “with a special focus on female talent for products and technology”.
Notably, dozens of angel investors also threw money into Truora’s recent funding, including Rappi’s CEO Simon Borrero; Deel CEO Alex Bouaziz’ Muni founder Maria Echeverri Gomez; CEO and Founder of Jeeves, Dileep Thazhmon-Jeeves; Bitsports founder Tatiana Fontalvo; Morado founder Angela Borrero; VaaS Founder Valentina Valencia, Anna and Kerry Wang of Searchlight; GGV Capital venture partner and ex-Affirm COO Huey Lin and Latitud co-founder Brian Requarth.
Of course, Truora’s investors are optimistic about the company’s potential. Accel’s Rich Wong said he was attracted to a group of founders made up of a technical team consisting of the former Twilio paired with great founders of product and business developers.
“It was the combination of the team that was the focus,” he said. “We’d also seen the success of this type of business in companies like Checkr, so there was a direct analogy there too.”
Wong thought so too it was logical that a regional/local supplier “is the first to understand the cultural differencees and local issues, and tailor a product to those needs.”
“For example, while WhatsApp is widely used in many emerging markets, it is a lower priority in the minds of most Silicon Valley entrepreneurs,” he added. “So the team’s insight to focus on the use case is a good example of how to get in touch with the regional needs.”
Propel Ventures partner David Morth said he had known Bilbao for five years and “seized the opportunity” to support him and the team he had put together.
“While the authentication and KYC products are very competitive, the key differentiator for Truora is how the technology is delivered,” he said. “Truora brings its capabilities in WhatsApp to the financial sector, targeting a segment of the population that has been difficult for fintechs to reach. We see a lot of potential in this model.”