Ian Faria, CEO of Mecanizou: “Hire senior professionals before scaling up and expanding”

Some people are born to be entrepreneurs, and we would put Ian Faria firmly in that category. By the age of 20, when most people are working out what to do with their life, Mecanizou’s CEO had already launched his first company.

Ian started his career building ClickBus, a B2C bus ticket marketplace in Brazil, where he also served as the COO for Latin America. Later, he ventured into the B2B on-demand logistics sector with iVoy in Mexico, acting as the COO and playing a pivotal role in expanding its logistics services for Express, SameDay and NextDay delivery.

Ian eventually returned to Brazil to lead operations for Kavak, a Mexican company that operates an online marketplace for used cars and expanded in his home country. All of which brings us to his latest venture…

What’s your elevator pitch?

Mecanizou is a B2B managed marketplace that optimises the auto parts supply chain, serving neighbourhood automobile repair shops in Latin America. We will be the platform that drives the digitalization of the automotive aftermarket industry, giving local repair shops access to complementary value-added services and tools, including financial products.

What made you launch a startup?

During the pandemic, the automotive market faced a significant setback, with parts factories, vehicle manufacturers, and other major players forced to pause their operations. However, mechanical workshops were considered essential services, and what’s even more surprising is that this demographic is generally not well-regarded in Latin America.

At that moment, I realised that I needed to get a closer look at the reality of this audience. My partner and I visited over 70 workshops to understand their day-to-day operations and all their challenges. We noticed that the mechanical workshop is primarily responsible for keeping the industry running but receives the least technological support.

We strongly believe that the real economy in Latin America will be one of the major drivers of innovation in the coming years, especially in industries with highly complex supply chains and process inefficiencies.

What problem are you trying to solve?

We decided to tackle a significant supply chain challenge. In Brazil, there are over 600 parts factories, 50,000 parts sellers, and 120,000 mechanical workshops, offering more than 100 million SKUs (Stock Keeping Units) of parts.

To purchase a part, the workshop needs to have information about:

• The vehicle (year, make, model, version, engine, etc)
• The part (including nicknames, applications, and technical specifications)
• The best conditions (such as location, price, delivery, and payment terms)

Mecanizou has developed proprietary technology capable of identifying the vehicle and the correct part for that vehicle. It also connects sellers, both retail and distributors and ensures delivery to the mechanical workshop in less than 55 minutes.

Can you talk us through your journey so far? What’s a major milestone you’ve reached?

In just two years of existence, we began in a single zone of São Paulo and have already initiated our expansion. In our first year, we achieved an impressive month-over-month growth rate of 70%.

I’m also proud that we now offer over 800,000 parts on our platform, providing a wide range of options to our customers. Plus, we have successfully processed more than 200 factory catalogues using our proprietary technology, showcasing our ability to innovate and adapt in the market.

Who are your main competitors and what distinguishes your startup from them?

We believe our main competitor is the local retailer, situated just a few blocks from the mechanical workshop, primarily due to the shift in purchasing behaviour from offline to online.

We have several key differentiators. First, the ability to find multiple parts, across various categories and price points, in just a few clicks. Second, multiple connected inventories, providing a broader range of availability. Third, receiving parts with a guarantee of accuracy between the part-match and the vehicle. And fourth, the option to choose the most suitable payment method.

Furthermore, we don’t rule out the possibility of retailers connecting to Mecanizou, which could expand opportunities in different areas and with various customers.

How has the startup scene in Sao Paulo helped or challenged your own startup’s development?

We were born during the pandemic, so we’ve always had a strong focus on financial diligence and a mindset centred on unit economics. This was especially aimed at mitigating fundraising risks and the well-known “venture capital winter”.

I believe the greatest challenge has been building a culture where everyone operates with the right financial education. This ranges from an account executive understanding CAC (Customer Acquisition Cost) to a logistics assistant comprehending the cost of logistics per delivery. Such understanding aligns our goals with the company’s objectives.

What’s the biggest mistake you’ve made and how did you overcome it?

We didn’t anticipate such rapid growth in 2022, and the month-over-month customer adoption of our product was substantial. This led us to develop a somewhat fragmented technology landscape, with many tests being conducted but not yet solidified. It posed an imminent risk to our growth.

After the Series A funding round, we began expanding into various zones in São Paulo and started to notice this fragility. We made the tough but necessary decision to hit the brakes and tidy things up. We spent nearly two months essentially rebuilding our model. It was a challenging decision, but essential to establish a solid foundation for scaling.

Where do you hope your startup will be in ten years?

We aim to become the most significant player in the automotive ecosystem across Brazil and Latin America.

We will digitise the entire supply chain, with the mechanic as the central decision-maker. They will not only purchase parts but also store all automotive market decisions, including which parts to use in a car, which brands to choose, and when replacements should occur, among other valuable information.

This profile is primarily offline but holds immense influence, encompassing transactions, data, finance and more.

What advice would you give yourself if you could go back in time?

I now believe it’s crucial to hire senior professionals before scaling up and expanding. Similarly, you need to balance speed with quality. The future cost of missed opportunities can be substantial.

My final message would be to define a few key metrics and stay focused on them. Sometimes, doing less and concentrating on specific metrics can result in more effective outcomes.

What would you say to potential investors reading this interview?

The best trajectory to understanding this opportunity involves three key steps:

• Reviewing the evolution and growth of the Latin American AutoParts market. There are a lot of recent reports and analyses by venture capitalists and reputable consulting firms regarding the automotive parts market.
• Reviewing the profitability of major companies in this sector listed on Nasdaq. I know it may not provide a direct comparison to Brazil, but it will help make our vision more tangible and reduce market bias.
• And of course, sending me a LinkedIn message (laughs) to talk more about how Mecanizou will transform the automotive industry in Latin America as a B2B marketplace.

For more interviews with startups…

… simply follow the links below:

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• Trevor Greenway, CEO of interVal: “98% of SMBs do not know their true enterprise value or, more importantly, what they can do about it”
• Taha Zemmouri, Eden AI: “It’s very difficult to project that far ahead in an AI world where developments occur in weeks, not years.”