“Our platform aims to connect the entire distribution chain and transform it into a value chain”

With 4.8 million vehicles sold in 2023, the automotive industry is one of the leading sectors in Latin America, serving as a key econonic driver in countries like Mexico, where it contributes nearly  4% of the GDP. However, the industry faces a specific challenge: digitising and connecting a complex supply chain to meet consumers’ demand for highly customised products delivered in a very short timeframe.

Alephee, founded in Buenos Aires by entrepreneursGastón Zelerteins, Javier Neumann and Jonathan Saiegh, is tackling this challenge head-on. “We want to help the sector digitise, improve and grow”, says Zelerteins. Their platform, which connects all players in the distribution chain, already brings together over 300 regional and global automotive companies, with a catalogue of around three million SKUs (stock-keeping units, or identifiers for auto parts and spares). In conversation with BBVA Spark, Zelerteins and Neumann discuss the origins, evolution, and mission behind their solution.

What was it like when Alephee first started, and how has it evolved into what it is today?

G.Z. Gastón Zelerteins and Jonathan Saiegh originally ran a company focused on Microsoft technology development and implementation. At the time, I had been working at Microsoft for 12 years, where I collaborated with them as a service provider. The three of us began exploring the idea of starting something new together, so they sold their company, and we started talking to people in different industries to understand their business needs. When analysing the automotive sector’s challenges with Mercado Libre, we realised that industries with a large volume of products sold by thousands of resellers face immense difficulties in scaling the creation of product catalogues. We proposed a technological solution to this issue, and Mercado Libre became our first investor. Since then, we’ve continually added new functionalities. For example, suppliers can now provide retailers with their own e-commerce portals. Two months ago, we also launched a feature called ’communities,’ where all members of the commercial chain can connect with each other to create new business opportunities.

J.N. The issue with the number of vehicles and parts in Latin America is linked to the age of the vehicle fleet, which averages nearly 16 years. Vehicle warranties typically last between three and five years, but after that, cars remain on the road and continue to require maintenance and part replacements. Mercado Libre is now the leading B2C platform for auto parts, but this comes with the challenge of creating highly detailed product catalogues with complex information (make, model and year of the vehicle associated with each part) to make searching possible. When we first started working with Mercado Libre, the marketplace had only a few products. Today, together, we’ve created over three million SKUs.

How does your solution bring value to the entire supply chain, and how do you leverage technology to achieve that?

J.N. In a supply chain as complex as the automotive industry, where you have dealerships, parts manufacturers, auto parts shops and repair workshops, the business will inevitably run into problems if the different players don’t collaborate. Our platform aims to connect the entire distribution chain, transforming it into a value chain. We offer solutions for both wholesale and retail, connecting brands with wholesalers and providing marketplace sales management tools for shops. All of this is backed by data analytics, giving businesses the insights they need to shape their future strategies.

G.Z. We’re also incorporating AI tools into all our processes, which adds even more value, since we can forecast out-of-stock scenarios to ensure the right parts are delivered to where they’re needed on time.

As you mentioned, your first investor was Mercado Libre. You also participated in the Y Combinator acceleration programme in 2021. What has the process of raising capital and forming strategic partnerships been like?

G.Z. That initial investment from Mercado Libre, combined with early signs of market acceptance of our solution, enabled us to approach other potential investors for pre-seed and seed funding, and we eventually saw an opportunity to tap into international financing. This led to our participation in Y Combinator, which opened up a world of possibilities, giving us access to top-tier global investment funds. While the venture capital landscape has changed since then, we’ve built a solid reputation within the industry. Our next goal is to take a leap to a Series A round, which will allow us to scale even further (something we’ve already done at a dizzying pace, establishing ourselves in nearly every Latin American country in under five years).

Given your rapid international growth, how challenging is it for a startup to expand into new countries?

G.Z. I think Argentina naturally encourages you to think regionally or globally from the outset. The country is also very open to digitalisation and the adoption of new technologies, which makes it an ideal testing ground for developing products. From the start, we knew that once the product was working, our biggest challenge would be entering the Brazilian market. So, a year after launching, we headed to São Paulo to work with Mercado Libre and begin connecting with local brands and distributors. The toughest part was localising: listening, understanding the culture and building a local team that shared our passion for the project. Once we managed that, expanding to other Spanish-speaking countries became much easier. Today, we operate locally in Argentina, Brazil and Mexico, and remotely in Uruguay, Chile, Colombia and Peru. This year, we’ve also started working in Ecuador.

J.N. We gained a lot from Y Combinator’s culture. Just a few days ago, Paul Graham, Y Combinator’s co-founder, published an article titled ’Founder Mode’. In it, he discusses how founders need to immerse themselves in the day-to-day details. You can’t lose that touch, even as you grow. It’s about growing your business while keeping a human touch, which aligns with what Gastón said about being in the country, living there, sometimes making personal sacrifices to stay connected.

What advantages do entrepreneurial projects like yours gain from having BBVA Spark as a partner?

G.Z. BBVA Spark’s arrival has been a game-changer. Up until now, there were venture capital funds analysing startups, but nothing similar existed at the banking level. Traditional banks tend to operate locally and assess startups based on their growth in a specific country, following a strict risk analysis model. Spark has come in to disrupt that model. What sets Spark apart is that it looks at your startup as a whole, across all its operations, rather than focusing on just one country. Their risk analysis is tailored to the startup model.

What advice would you give to entrepreneurs looking to launch or scale their own businesses?

G.Z. I’d say the key is to build a business around a real, well-analysed problem, because people will be willing to pay for it. Also, assemble a team that works with passion every day and can evolve alongside the needs of your clients.

J.N. My first piece of advice would be to think about solving something that’s a real problem, as Gaston said. Second, think big, not just in terms of a city or country, but at least on a regional scale, like Latin America, with a solution that can scale globally. Then, believe in yourself. And finally, make sure to enjoy the journey.