Coba

Simplifying cross-border finances for Mexican professionals earning in dollars.

Daniel Rodriguez

and

Andres Gonzalez

Jul 11, 2024

Startup Snapshot

Startup name: Coba
Industry: Fintech
Business Model: B2C
Founders: Abraham Kuri Vargas, Carlos Medellin, Eduardo Lopez De Leon, Joseph Saliba
Operates in: US & Mexico
HQ Location: Austin, Texas
Team Size: 10
Founded: 2022
Stage: Seed
Investors: YC, Alaya Capital, Banco BASE, Goodwater Capital, Switch VC, among others.
Accelerators: YC
Website: https://www.coba.ai/
Crunchbase Profile: https://www.crunchbase.com/organization/coba-0781

What does your startup do?

Coba is a financial platform that enables Mexicans earning in US dollars to spend those earnings in Mexican pesos seamlessly from within Mexico. The platform facilitates the creation of a US bank account through a regional bank, offering account numbers and routing numbers digitally. Users can receive payments from US clients, make ACH transfers, and access various financial services, including payroll advances, contractor insurance, and payment settlement services between the two economies. Coba does not charge commissions but makes money through the currency exchange spread.

What's your backstory?

Eduardo López and Ivan Kuri met in college and founded Icalia Labs after graduating. Later, Carlos Medellín became their CFO, and Joseph Saliba was one of their most important customers at Icalia. Impressed with his work ethic and coordination, Eduardo and Iván decided to approach Joseph and discuss the possibility of building something together, and Joseph was all in. They began exploring business models to bridge the US with LATAM, initially in the form of tools focused on connecting and employing Mexican talent with US companies, however as they spoke to more and more talent they realized that many of them had a strong pain in terms of earning money in the US and spending it in Mexico, this is why they ended up shifting towards modern cross border financial services.

How did you acquire your first clients?

Coba's first clients were acquired through existing relationships and networks built both from their time at Icalia as well as testing their initial hypothesis with Coba connecting LATAM talent with US companies. Once they realized that most contractors in LATAM faced challenges earning in the US and spending in LATAM as most existing services are expensive to the degree that some are even predatory. Soon after, they launched a landing page and waitlist to generate interest and intrigue for a potential cross-border financial solution, now Coba, leading to an initial user base that provided valuable feedback for product development.

How and when did you realize you had achieved PMF?

There are two indicators for us that indicate we’re there, or very close to it. Recently, we sampled around 70% of our user base and asked them how they would feel if they could no longer use the product?” and we got over 60% of users stating that they would be “very disappointed.” It’s worth noting that most of our users came from competing platforms, some of them being the incumbents so this was very reassuring that we are building something people love.

The second indicator of PMF was that when customers were interviewed in the early days users would mention reasons why they loved Coba and how Coba solved a problem that the previous platform they used didn’t. Hearing this once or twice wouldn’t be relevant, but this was constant. In every interview, every user would state why they loved using Coba and why it was the best solution they had tried to date.

What's your motivation?

The team is driven by three main factors:

Working together with such an amazing team and working on solving complex problems together is exciting.
Interacting directly with consumers and seeing their products make a tangible difference in users' lives is incredibly satisfying.
The sheer size and complexity of the problem are another reason that keeps them excited and motivated.

What's next for your startup?

As they continue to advance, Coba has two main objectives: growth and improving the product. As with any startup, resources are limited, so the team has to prioritize aggressively, but it’s necessary to continue improving in different ways that fulfill what their customers need and to continue attracting new customers.

Tips for other founders?

Network with other founders: Engage with startup founders to share experiences and learn from their journeys. Building long-term relationships with those in the industry can provide invaluable insights and help avoid common pitfalls.
Build strong relationships: Focus on building meaningful connections rather than transactional relationships. A strong team with a solid foundation of trust and friendship is crucial for long-term success.
Don't go it alone: It's essential to have co-founders to bounce ideas off and share the journey with. A team's cognitive diversity and support can significantly enhance the startup's chances of success.

Recommended Resources:

Podcast: All-In Podcast
Books: "Hackers and Painters" by Paul Graham and "Founders at Work" by Jessica Livingston

VC Headlines:

Axelerate Talent Network:

Axented

Insulet

Samsara

Special thanks to our sponsor:

Axented helps businesses design, build, and scale their products and teams worldwide.

With over 10 years of experience and a diverse portfolio of more than 300 projects delivered in over 15 countries, Axented has established itself as a trusted partner in the tech industry.

Renowned for its expertise and commitment to excellence, Axented provides innovative solutions to help businesses thrive in a digital world.