With the presence of Guilherme Benchimol, founder of XP, the top executives of the Peruvian company Zest formalized an alliance in Montevideo to expand into the onshore and offshore markets of Latin American clients, with one of their bases being the Uruguayan capital.
The giant XP, a technology platform that provides investment products to retail clients in Brazil, is now targeting various segments of Spanish-speaking Latin American clients, both locally and offshore. To this end, alongside its partner Zest and its new office in Montevideo, led by María Noel Hernández, XP will undertake a particularly challenging technological and cultural shift.
Entrepreneurial and Technological Culture
Wearing casual clothes and white sneakers, Benchimol, accompanied by Arthur Silva, founder of Zest, showcased a youthful maturity in Montevideo and began his analysis before a small group of bankers gathered at the Radisson Hotel. “In Latin America, the banking sector is very concentrated and does not provide access to good investment products for people. Our goal is to help people invest better,” said the founder of XP.
Created by Benchimol and his partner Marcelo Maisonnave in 2001, XP now has five million clients and manages 1 trillion reais. But that’s not all: the firm is currently the main vehicle for international fund managers, has offshore operations (with offices in Miami and the Cayman Islands), and in Brazil, works with a network of 20,000 independent financial advisors.
Through its fintech platform Rico, XP offers investment funds from firms like Baillie Gifford, BlackRock, Fidelity, Fundsmith, J.P. Morgan, and Vanguard. It thus makes available over 500 equity funds, 2,000 fixed income funds, 730 multi-asset funds, and 160 alternative funds.
Benchimol speaks to millennials, both end clients and private bankers, with a new “dress code” and language: “We are entrepreneurs, not account managers,” he says. “We offer infrastructure so that our network can serve their clients internationally.”
The 21st century begins with the dominance of technology companies over financial ones, a paradigm shift. It was only a matter of time before financiers like Benchimol joined the prevailing entrepreneurial and technological culture.
The word “trust,” central to traditional private banking, slips into the discourse, but XP’s competitive bet is on technology: “U.S. banks have heavy structures. Our dream is to serve American residents and bring them our culture, which consists of offering the best customer experience. We will do the same as we have done in Brazil, where we have been recognized as the best company for six consecutive years, ahead of Itaú and Santander,” says Benchimol.
“We Are Not a Bank, We Have a Bank”
XP’s innovative and technological identity is summarized in one phrase: “We are not a bank, we have a bank.”
But with its offshore structures in the Cayman Islands, Miami, and now in Latin America (Peru and Uruguay), we are talking about a true financial entity that particularly targets clients with international investments who want to move from onshore to offshore with a single click.
For its Brazilian clients, XP has managed to overcome regulatory and tax difficulties through technology, but as Benchimol says, “no client can resist a financial advisor who is empathetic and persistent.”
During the event in Montevideo, taking advantage of the B2B Summit for entrepreneurs, XP’s technicians and onboarding specialists demonstrated their mobile app, capable of “breaking down barriers and providing access to both Brazilian fixed income and U.S. Treasury bonds.”
With small print not suitable for presbyopia but adapted to millennials, the XP app is specially designed for retail clients starting from very low amounts and aims to reach financial advisors with equal efficiency. The promise of three clicks to be online and invest must translate into ease of gaining clients, overcoming regulatory barriers, and switching from the local market to offshore in seconds.
Zest, founded in 2016 by Arthur Silva, a Brazilian resident in Peru, is a young and small company now partnering with a giant to conquer, no less, the Latam market. The firm has an expansion plan with the opening of branches in Uruguay, Chile, and Colombia. With the support of XP Wealth Services US, it aims to reach 5 billion dollars in assets in the next three years and double its team. The adventure has just begun in this southern winter of 2024, perhaps marking the start of a new success story in Wealth Management.
For Marcelo Soba
For Claudia Robledo