In mid-September, LatAm Startups, an organisation dedicated to support emerging companies from Latin America to scale globally from Canada, celebrated the arrival of its most recent cohort of startups, who participated in their Fall bootcamp. The startups hailed from Brazil, Chile, and Mexico, highlighting the growth that these countries have experienced in their innovation ecosystems.
Among these startups was SISAT, a company founded by Rogelio Martinez and Octavio Vazquez, with whom Lattin Magazine had the opportunity to have a conversation regarding their incursion in Canada and the goals they aim to achieve with their company.
SISAT was founded in 2008 in the city of Monterrey, Mexico, with the purpose of distributing tracking devices that allowed fleet owners to monitor their vehicles using a satellite geolocation service. It was the height of Mexico’s drug cartel war, and thus, in a conflict-ridden city, safety and surveillance tools were welcomed with open arms. Nevertheless, it does not mean that the road ahead would be smooth sailing.
It was a matter of fate that Martinez and Vazquez encountered the idea of launching SISAT. It would be better said that the opportunity came to them. Having met in England while working for the British division of CEMEX, the Mexican building materials multinational, they were then transferred to the concrete-and-cement manufacturer’s Irish office, overseeing the country’s logistics operation and where they had their first encounter with BIS – Business Information Systems. BIS was in charge of implementing a project for CEMEX with the purpose of facilitating its internal planning processes.
The project was concluded successfully. What wasn’t successful, though, was CEMEX’s operation. In 2008 and 2009, with the tension that prevailed over the international economic environment, CEMEX shares plummeted and the organisation was rescued by a $15 billion USD bank loan. The firm’s crisis turned out into an opportunity for the to-be SISAT co-founders. Subsequent cost-cutting actions led to Martinez and Vazquez being laid-off, and slightly after that, they struck a deal with Business Information Systems to represent them in Mexico. That signaled the beginning of their entrepreneurial path.
“Our initial journey was gruesome,” said Martinez. “Our main clients were friends and family, and it was hard to get new customers because nobody knows us at the time”
Just as they were aiming for profitability, and in the midst of their startup-stage struggle (According to a Harvard Business School study, the rate of failure among startups is 50 percent on the first five years, and 70 percent after ten years), SISAT managed to close a project with world’s largest tortilla manufacturer GRUMA.
“It was pure, fresh air,” reminiscences Martinez, primarily as the deal opened the door for SISAT to seal contracts with other prominent names in the Mexican industry, such as the poultry producer Bachoco and retailer The Home Depot.
Once there was a consistent stream of income powered by big-name clients, SISAT made a move to grow horizontally, adding a service to their offerings that consisted in software that optimized fuel consumption. “We realised that most of our clients not only had their own trucks, but also their own gas stations. We thought it would be the next natural step to link this service to our tracking system that would enable the customer to calculate fuel efficiency with real-time accuracy and find ways to optimize it.”
More growth followed, and now, SISAT employs twelve people, who are spread out through their offices in Monterrey, Sonora, Mexico City, and Puebla, as well as an international division headquartered in Tucson, Arizona. SISAT co-founders are looking at Toronto as their next stride, hoping it will be their tipping point to scale and conquer further international markets.
This is something that they hope to achieve through Paroute, their latest innovation, an all-inclusive software that aims to provide effective solutions for last-mile delivery.
Further defined, last-mile delivery is “the movement of goods from a transportation hub to the final delivery destination, and is focused on deliver items to the end user as fast as possible.” (Datex, 2018).
“Toronto is an environment incredibly conducive to business. You could call a CEO and schedule a meeting and it would happen. This is not as common in Mexico.”
Paroute will be able to support clients in this process, according to Martinez, “our software, combined with features of our two previous implementations, is able to provide with the most efficient logistical solutions, determining how many transportation units are needed and what are the most optimal routes to take. It is connected to our tracking system, and therefore, operations can be monitored in real-time. It is our next big idea.”
Martinez is optimistic that being an integrated-solution provider will boost their international expansion. “We have already had tests in South Africa, for example. We don’t think there is much competition to a service that groups all the features that we offer, so we truly believe we can thrive internationally.”
With these high ambitions, Martinez recalls the not-so-funny moments throughout the development of their venture. “There were times where we were about to shut down. But honestly, we did not want to go back to being employees. That kept us going,” remarked Rogelio, also proud of the impact that SISAT is creating. “In the end, our solution, besides providing with tools for financial savings, is also an environmental solution. If we optimize fuel consumption we are not only saving money, we are helping to save the environment. We all benefit.”
On a personal level, Rogelio Martinez hopes to, sometime into the near future, emigrate to Canada and lead the Canadian operations of SISAT and Paroute. He was positively surprised by the easiness with which he navigated the ecosystem and the support that exist for burgeoning entrepreneurs.
“It was an environment that was incredibly conducive to business. You could call a CEO and schedule a meeting and it would happen. This is not as common in Mexico. Also there are many public events where you can listen to top-notch speakers and meet incredible people, and they are all free.”
Just as SISAT and Paroute hope to take Canada by storm, in the world’s unscripted war to attract top talent and be home to the world’s leading ideas and innovators, Canada’s ecosystem continues to be a thriving alternative to the turmoil at the South, and future prospective immigrants like Rogelio Martinez can be a testament to it.