Gabriel Gruber, Exactly Finance | DeFi in Latin America and Lessons from a Serial Founder [Ep. 45]

The audio and video are in Spanish. These notes are a translation.

Can you imagine a financial system that belongs to no one, based on software, and that runs on a decentralized network of servers around the world? This concept is known in English as Decentralized Finance, or DeFi, one of the applications of crypto and blockchain technologies. DeFi has the opportunity to significantly increase competition in the financial services sector in Latin America.

To understand more about DeFi, we invited Gabriel Gruber, CEO and cofounder of Exactly Finance, a Latin American startup that is building a decentralized credit protocol for lending and borrowing with stable cryptocurrencies, fixed interest rates, and longer terms. Before starting Exactly, Gabriel founded the startups Sumavisos and Properati, which was acquired by OLX in 2018.

Gabriel told us how his interest in crypto was born and evolved to the point where he found an enormous opportunity to start a startup. We also talked about what he calls the scientific method of starting a company and the lessons he has learned after more than 10 years of building companies, including several key mistakes he would have liked to know when he started.

What You Can Learn Today

DeFi versus CeFi
Opportunities for DeFi solutions in Latin America
Fundraising recommendations from a serial founder

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Youtube Timestamps*

A Startup Idea in DeFi and Learning Fast

[1:40] - How did Gabriel get into the world of startups?
- Experience in Economics and Finance
- The desire to play in the game instead of watching it
[2:35] - What is Exactly Finance?
- A protocol that lets users deposit cryptocurrencies and receive loans with them as collateral, at a fixed rate for a period of time
[4:30] - How was his interest in crypto born, and how did it evolve into the idea for Exactly Finance?
- A conversation with Santiago Siri in 2013
- First experiments with Bitcoin
- Reconnecting with the crypto world after the Properati exit
- The possibility of programming money
- A mix of economics and finance with technology
- Meetings with people experienced in crypto
- Identifying new applications for crypto
[7:48] - What is a protocol, and how, thanks to one, can you change the credit market from Exactly Finance?
- Running software on a centralized database vs a decentralized one
- Decentralized validation of information
- Benefits of tokens for the user
- Exponential growth of users and money deposited
- The case of the evolution of the Internet
- Ethereum’s scalability
[14:47] - What was his strategy for learning so fast about an industry that was foreign to him, and what recommendations would he give other founders for getting to know their industry?
- Setting a goal with a deadline
- His experience preparing to take part in a marathon and a triathlon
- Not being a specialist in every aspect of the industry, but understanding all of them in a general way
- The case of cell phones and smartphones
- The potential of crypto technology to solve big problems

DeFi

[21:46] - An API so financial institutions can get onto DeFi and so more banks worldwide can compete to give you a loan
- Initial launch for users who already know the technology
- Progressive addition of simpler features
- Bridges between CeFi and DeFi
- Benefits of DeFi for users
[23:39] - What does the bridge between CeFi and DeFi consist of?
- Software: bank technology not yet suited for DeFi
- Legal: identity regulation in order to provide a loan
[25:09] - What tailwinds does Gabriel see for DeFi services in Latin America, and what needs to be done to take them mainstream?
- Benefits for developing countries with greater financial instability
- The potential to take crypto mainstream through games and art
[27:19] - In which crypto or DeFi use cases in Latin America would he like to work if he were not building Exactly Finance?
- Payments and remittances
- Lightning Network
- Instant payments
- Solutions on L2
- Gaming
- The impact of Web3 on the financial industry

Lessons from a Serial Founder

[31:07] - How does the scientific method relate to starting a company?
- More than 10 years of building companies
- The case of COVID
- A parallel between the scientific method and starting a company
- The importance of the technical and commercial sides
- The case of Elon Musk and Tesla
[35:30] - Advice for other founders thinking about raising capital in this context of abundant capital
- The car analogy
- Consequences of raising too much capital
- The importance of correctly assessing investment needs
- Expecting the best but planning for the worst
[39:17] - How do you balance the temptation for VCs to invest an amount that is too high, seeking to increase the startup’s speed?
- Raising capital as a strategy to create a barrier to entry
- The need to reach a middle ground on the investment amount
- The importance of considering what stage the startup is in
[41:31] - Key mistakes he made at his previous startups and that he has avoided at Exactly Finance
- Raising the capital the startup needs
- Looking for investors with expertise and reputation in mind
- Learning from others and asking questions
- Having humility as a founder or CEO
- Giving the team what it needs to be well and be productive
[47:16] - How can a first-time founder identify which problems are normal and which are not, so they can focus their attention better?
- Clarity on the company’s priorities
- The importance of staying focused on the goal despite the iterations
- The Exactly Finance example

Tweet Round

[51:24] -
- Recommended books: Works by Jorge Luis Borges
- Changes in the Latin American startup ecosystem: more success stories of founders who started from nothing
- Founder to interview: Damián Catanzaro, of Cafecito App