In Latin American countries like Brazil and Chile, the messaging platform WhatsApp has become one of the most popular apps to use to buy things online. It was even the e-commerce platform of choice in the region during the pandemic. But WhatsApp is designed to be a messaging platform, not an e-commerce site. A startup called Mercately is building back-end software to help brands sell better through WhatsApp.
Mercately is B2B software that builds the infrastructure brands need to sell directly on WhatsApp. The company integrates with platforms like Stripe and HubSpot and uses AI agents to help brands communicate with customers, check inventory, take payments and create purchase orders without the customer ever leaving WhatsApp.
Henry Remache, co-founder and CEO of Mercately, said he got the idea in 2021 while doing software development for companies in LatAm. He had a client in Ecuador looking to sell shoes through e-commerce giant MercadoLibre. When Remache discovered that this client was doing 90% of their sales through WhatsApp, the light bulb went off: brands shouldn’t be looking to launch platforms elsewhere; they should try to sell more where they already are.
“It’s quite unusual for a small or medium-sized company [in LatAm] have a website; they do all the transactions on WhatsApp,” said Remache. “The behavior is already there; people use WhatsApp to shop and chat with their family. We take the behavior and make it much easier for these companies to sell where the people are.”
Remache said building the startup wasn’t easy. LatAm is a fragmented market with different currencies and shipping processes. The company was launched in 2022 and currently works with over 1,000 companies in 20 different countries. Mercately is profitable and has topped $1.5 million in annual revenue, he said.
“In the last two years, we’ve grown 3.5 times year over year,” Remache said. “The growth has been phenomenal. I’ve only seen more and more companies implement this type of system. Companies are realizing that they need to adapt to consumer behavior instead of trying to use old methods like a website.”
The startup just raised a $2.6 million seed round led by Inventus Capital Partners and SVQuad, with participation from Techstars, Salkantay Ventures and BuenTrip Ventures. Remache said the capital will move to hire more AI engineers to strengthen its AI chatbots. It will also try to strengthen Mercately’s presence in Brazil and the US, countries where it already operates, but where it does not yet have a strong market share. Remache said fundraising wasn’t easy.
“First of all, being from Latin America is a little bit different; there is not that much money here,” Remache said. “What opened the doors for us is that we are a Techstars company. Techstars was definitely a big move for us.”
The company also made Meta’s “Future of Business Messaging Platform” program in 2022, which they pitched to their lead investors, Inventus Capital Partners and SVQuad. Remache said Mercately is both organizations’ first investment in LatAm. Remache added that their main investors are from India, another country that uses WhatsApp a lot, which means they understand how entrenched WhatsApp can be.
WhatsApp has become a hotbed for startups growing on the platform in recent years – especially in LatAm. Just last week, Magie, a Brazilian company that makes it easy for its users to send money and pay bills via WhatsApp, raised a $4 million round led by Lux Capital – the company’s first investment in the region. Félix Pago is another who raised a $15.5 million round to facilitate WhatsApp payments earlier this year.
Mercately isn’t the only company building business services for WhatsApp either. Private equity-backed Infobip is a company focused on marketing and customer engagement. Venture-backed Trengo is another focused on communicating with customers via WhatsApp. These companies, or a new entrant, could encroach on Mercately’s market share if they add more business services. Meta, of course, could release these features as well.
So many businesses rely on WhatsApp because the app is deeply rooted in LatAm culture, Remache said. More than 90% of internet users in the region use the platform. The US hasn’t seen as much adoption as other regions, but it’s growing. Remache hopes Mercately can take advantage of this trend.
“I’m just thinking about how Shopify has simplified web-based e-commerce in the US. We’re simplifying WhatsApp commerce in LatAm,” said Remache.
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