CLIP

Adolfo Babatz spent years at PayPal running its Mexico business. He kept bumping into the same wall.

Most Mexicans could not pay with a card because most merchants could not accept one. Card readers were expensive and locked behind bank contracts.

In 2012 he teamed up with Vilash Poovala, an engineer he met at PayPal, and they built a prototype for a cheap little reader that plugs straight into a smartphone. No bank visit.

No monthly fee. Just plug it in and start taking cards.

That gadget became Clip.

Clip sells a small card reader to a merchant, then takes a cut of every sale that runs through it. That is the core.

But the reader is really a hook. Once a small business is on Clip, it can open a business account, take payments online, and borrow money.

Clip earns on transaction fees, lending, and its other financial products. The bet is that millions of tiny Mexican merchants, added up, are a giant market that the big banks were too lazy to serve.

The star is the Clip card reader, a cheap dongle that turns any smartphone into a card terminal. Around it, Clip has built a full kit for small merchants.

There is Mi Clip, a digital wallet, plus a business account, online payment links, and lending to merchants who need working capital. The idea is to be the one financial app a small Mexican business actually needs, from taking the first payment to funding the next inventory run.

Clip grew by going where the banks would not. It targeted the small, cash-only merchants that giant financial firms ignored, and made signing up almost effortless.

Buy a reader, plug it in, done. As those merchants grew, Clip layered on more services and grew with them.

That land-and-expand move is what caught SoftBank's eye. In 2021 SoftBank's Latin America Fund and Viking Global led a $250 million round, and Clip became the first payments unicorn in Mexico.

The company added another $100 million in 2024 from Morgan Stanley.

Cash is stubborn in Mexico, and that is Clip's whole problem. A huge share of the economy still runs on physical bills.

Convincing a small merchant to trust a digital reader takes time and money. Competition is heating up too.

Mercado Pago, banks, and other fintechs all want the same merchants. Clip has to keep spending to win them while staying disciplined enough to reach profit.

Turning an unbanked country into a card-swiping one is a long, expensive war.

Clip pulled in a who is who of global money. The defining moment came in June 2021, when the SoftBank Latin America Fund and Viking Global led a $250 million investment that valued Clip near $2 billion and crowned it Mexico's first payments unicorn.

Earlier backers included General Atlantic, Goldman Sachs, and American Express Ventures. In 2024 Morgan Stanley Tactical Value led another $100 million round.

The through line is simple. Serious investors believe Mexico's shift to digital payments is just getting started, and Clip is their pick to ride it.