The Visionary Behind Clip’s Multibillion- Dollar Journey
By Consuelo Valverde
April 2023
Clip, Mexico’s leading commerce and digital payment platform, has come a long way since its inception 10 years ago. Founded by Adolfo Babatz, the company has grown to become Mexico’s first payments unicorn and its largest merchant acquirer, with a massive market share that processes payments for hundreds of thousands of businesses.
The impressive growth of Clip is also reflected in the value of its brand. In a recent study ranking the most important brands globally, Clip secured the 17th spot among Mexican brands, with an estimated worth of $1 billion USD. It was the only Mexican startup on the list, showcasing the immense success of this homegrown fintech venture.
From 2012 to 2015, Clip focused on product development, learning from early errors and refining its strategy. As Adolfo explains, “I made all the mistakes a non-experienced founder does — all of them.” He brought in Myriam Cosío, a former vice president at American Express Mexico, and together they streamlined the company’s focus, ultimately deciding to distribute offline through partners like Sam’s Club, Walmart and Office Depot, and via independent resellers.
Adolfo envisions Clip as “the operating system for commerce in Mexico” — the one-stop shop that merchants use every day from the time they wake up until the time they go to bed.
Adolfo’s journey was not without challenges. In mid-2016, he realized that Clip could run out of money much faster than anticipated, as the company was growing at an astonishing rate of 20–25 percent month over month. This rapid growth prompted Clip to start fundraising, and introduced a whole new array of problems for the CEO — from a financial point of view, and especially from an HR perspective.
“Hypergrowth brings a unique set of challenges for the team and the way a company operates,” Adolfo says. “To my point of view, these are the hardest challenges a startup CEO faces.”
Adolfo and his team worked quite intensely during this critical period, securing several term sheets as they sought to address their financial situation. These efforts eventually led to the successful closing of a funding round with General Atlantic. Despite running low on cash, Clip managed to navigate those tough months without experiencing any setbacks. The rapid growth that threatened their financial stability was, in a way, a testament to Clip’s success and its potential. After the funding round, Adolfo and the board shifted their attention to making the management team much more robust and experienced, and making sure that the company could scale from a people perspective.
This experience served as a significant lesson in Adolfo’s entrepreneurial journey, teaching him the importance of being prepared for the challenges that come with rapid growth, and the need for quick and decisive actions to ensure the company’s continued success.
In June 2021, Clip reached unicorn status, with a valuation of $2 billion. Reflecting on this achievement, Adolfo acknowledges the importance of resilience. “Being an entrepreneur is like being on an eternal roller coaster ride. Except a roller coaster ride lasts two minutes, so it’s fun. If you were on the ride nonstop for 24 hours, you would be exhausted and every part of your body would ache.”
The key to surviving and thriving on this roller coaster, he explains, is learning how to embrace the unpredictability and uncertainty, and using those experiences to grow stronger and more adaptable. Above all, surround yourself with incredible people and make sure you set aside time for guidance and reflection. “Having a core team of people that can help you as CEO is key for the long-term success of the company and for your own well-being — both physical and mental,” Adolfo says.
Adolfo identified trusted individuals from inside and outside the board who could provide him with business advice and valuable insights — although the advice did not always turn out as expected. He also enlisted a coach to help guide him in serving as both a CEO and a founder. The coach helped him navigate the complexities of meeting expectations, managing his team and maintaining a clear vision for Clip. Recognizing the importance of personal well-being, Adolfo also engaged a therapist to help him build resilience and maintain a healthy mental state. He understood that everyone has a breaking point, and that the right support could help extend that threshold.
In a recent study ranking the most important brands globally, Clip secured the 17th spot among Mexican brands — the only Mexican startup on the list.
Clip’s growth was not without its share of external challenges, such as the COVID-19 pandemic. “For me, it was devastating — the whole period,” Adolfo recalls. During Mexico’s lockdown, businesses were not operating, leading to a huge decrease in the volume of payments. But the company bounced back in August 2020 with a 100-percent growth rate compared to the previous year. That same year, the company struggled to raise funds, while other companies managed to secure capital. This trend continued into 2021, as newer companies with only 1–2 years of existence achieved valuations similar to Clip’s, becoming “synthetic unicorns.”
Despite others raising massive valuations and receiving higher revenue multiples, Clip never managed to secure the same level of funding or spending that other companies did in 2020 and 2021. Some investors (especially the ones with limited experience in emerging markets) often criticized Adolfo for being too conservative, urging him to raise more capital and spend more to grow faster. Adolfo remained steadfast in his vision, however, questioning the point of raising money just to move farther away from profitability. Adolfo and the Clip board’s unwavering commitment to his principles and strategic decision-making ultimately contributed to Clip’s long-term success.
Adolfo envisions Clip as “the operating system for commerce in Mexico” — the one-stop shop that merchants use every day from the time they wake up until the time they go to bed. With a massive market share, high-quality products, a strong brand presence and a wide distribution network, Clip is well on its way to achieving that goal.