DLocal Limited (DLO) Earnings Call Transcript & Summary

Okay. So good morning, everyone. Welcome to DLocal Investor Day. I'm Soledad Nager, Head of Investor Relations. So before we start sharing our story with you, there are some items I would like to draw your attention to. First, with the packet you received, there is a QR code that has access to the website for this event. In the website, you can find the bios for the speakers and the definition for some of the terms that will be used during the presentation. Second, I would like to remind you of our agenda. We will start the presentation soon. After all speakers present, we will do a 10-minute break. After the break, we will have a Q&A session with the management team. Once the Q&A is over, we will offer you refreshments in the adjoining room where you will have the opportunity to speak to management directly. Now give me one second that I'll give you a few minutes to read our safe harbor statement. Okay. And with this, I would like to call to the stage, Eduardo Azar, our Chairman; and Martin Escobari, Co-President of General Atlantic. Thank you.

First, we want to thank everybody here to be here with us. Hopefully, we will be able to explain our company and give a nice picture, a nice color of what we are doing. We know how difficult is to set aside one whole morning, and we cannot appreciate more with your presence here. I am Eduardo Azar, Chairman of DLocal, early investor from 2015. I want to tell you a little bit how I got involved on this. I was in Punta del Este in Uruguay, pretending to have some good holidays. And all the sudden, one common friend, introduce me to Andres, Sergio and they start talking about the idea of creating a company to work in emerging markets. And I was so impressed when I met Andres, Sergio and Jaco because they found the problem, and this is the way to start a business. They found the problem and they found the solution. And the problem was that people in emerging markets want to buy, want to have access to buy online. And it's the worst thing that could happen. Someone want to sell, the other want to buy and the transaction doesn't happen because of lack of infrastructure. And when I saw that and I saw the idea and I saw for [indiscernible], the entrepreneurs, this is what immediately I jump into because of them, because of they were terrific entrepreneurs with great ideas and willing to work very hard. And this is how personally I joined the company investing and acting and then become a Chairman. After 8 years of working hard with a lot of passion, we are here. We made the company public. We started with one country and this is also important to say, when the company started in Uruguay, and Uruguay has 4 million people. So if you want to make money out of 4 million people, we wish you luck, that is difficult. But that is the adversity. So when you have adversities, that you have that universe, you have to think out of the box and you have to go global. And this is exactly what DLocal did. No rely on the Uruguay market and relying on global. And we started with Brazil, and we follow with different countries, Argentina, Paraguay, Uruguay and now we have 40 countries counting. What we do here -- what we do DLocal for merchants is improving the conversion rate. So we make the transaction happen. We improved the conversion rate and this is what we understand because we are from emerging markets. And there is a lot of similarity with Nigeria, with Brazil. And because we understand, we managed to find a solution. I cannot be more proud of what we accomplished so far. Another thing that I want to point out is that we are processing $12 billion, $50 billion -- is nothing. We are scratching the surface. There is $1 trillion to process. You will see here that the potential of DLocal. So when they talk about saturation, we are maybe 1% of what we can do here. So our view is 5, 10 years. We are not concerned about one quarter-to-quarter. I would like also to take the opportunity to welcome Sergio Fogel that is the founder, but also decided to come as an executive, will be extremely helpful for the company. He worked with -- with Sebastian for the last 10 years. And I think he will be a great addition to the executive people. So now I want to call Martin Escobari from GA. GA was an early investor, we were so lucky to find a partner like GA, it's a dream of a partner. We work together. And now, Martin?

Thank you, Eduardo, and thank you, everyone, for joining us for DLocal's first Investor Day. It's a very special moment for the company, and I'm grateful for the invitation of Seba and Eduardo to invite me to say a few words. My life is in Latin America. I was born and raised in Latin America. I was an entrepreneur and I have been an investor in Latin America. GA has been in Latin America for 20 years. And we've invested $7 billion, $8 billion in Latin America over that period. And if you look at our returns in Latin America over those 20 years, they're among the strongest we've had globally. And where many of our investors come to us is how do you do it because Latin America is not a fertile ground for successful investing in the private equity space. There are very few funds that have actually made money in Latin America. And as I reflect on 20 years of work, we've managed to do well because we tackle what Eduardo called big problems. So there are many things that don't work in Latin America. Those of you that live in New York know that renting an apartment in New York is hard. It's 10x harder in Sao Paulo because it's all fake listings and the no MLS, there's no price discovery and there's no FICO scores, so you have to pre-pay 6 months of rent. So if you create a platform that allows it to happen seamlessly, you create a lot of value for your customers, and you can capture a lot of value for you. Buying a used car, that's difficult in the U.S. It's impossible in Mexico. You think you're buying a car, it's not actually a car. And if you create a platform like KAVAK that does this seamlessly and so forth, you can capture a lot of value and so forth. If you're retail investing, retail investing, if you rely just in four banks in Brazil, that's hard because they charge you a lot for limited assortment. But if you create a platform that's open and -- those of you that know XP, that's also been one of our great investments, and we've been investors in XP for 12 years now. And we invested in XP when they had 200,000 customers, now it has 4 million customers. It changes the way Brazilians invest. And I think DLocal is one such story. Cross-border payments into the emerging markets are horrendous. If you're a merchant trying to sell to Uruguay, Paraguay, Bolivia, Brazil, Argentina, not to mention Nigeria, muddy waters, favorite country. It's impossible. It's very, very hard. Acceptance rates are -- you have to deny 20% to 30% of the people that are trying to buy from you. And if you're a business that has 95% gross margin, that's a lot of profits that go away. So if you create a solution that allows you to safely accept more customer demand, you create a lot of value for your merchants, you create a lot of value for the end customers who are able to buy something that otherwise it's more difficult to buy without an international credit card, and you can capture a lot of value. And that in a nutshell is what DLocal is trying to do, at scale, across the globe. When we invest in an opportunity, we look at three driving criteria. This is across the globe, and it's also true in DLocal. First, we're trying to find opportunities of companies that are going after very large markets. Cross-border payments is a $1 trillion opportunity, and it's growing. DLocal's market share of 1%, 1.5%, amazing TAM. As large as TAM as we can think of. In the 4 years, GA has been an investor, DLocal, the company has grown 10x. I hope it grows another 10x in some -- in the near future. I cannot say the date, but because in the safe harbor statement. But if you -- there's a lot of high ceiling to grow. The market is as exciting as there is in terms of market size. The second criteria we look for is does the company have a sustainable competitive advantage. And the way I like to measure competitive advantages as they have a gross margin. Because if you're better than your competitors, you can charge a little more. And we know DLocal has a relatively healthy take rate and relatively healthy gross margin because it's addressing a problem and the merchants are willing to pay for it. Is that gross margin sustainable? As we know, every market gets more competitive over time. And if you dissect the gross margin of DLocal and the more competitive margins versus less competitive margins, obviously, it's better -- it's higher in the less competitive markets than in the more competitive markets. So there is a trend of margin compression that if you take the 10-year view, it's going to happen as more and more markets become more competitor. It's inevitable. Against that, is DLocal's ability to add more value through new services and new countries. And one of the fundamental thesis of the one DLocal strategy that Seba, Jaco so well articulate is having gone through lengthy customer acquisition processes. Now when you're bringing on a new merchant, it takes 3 to 18 months -- how long did the Amazon take? Was it 2 years? 2 years. It takes 3 months to 2 years to be certified by one of these merchants because rightly so, they're concerned about suitability, they're concerned about the data integrity, we paying all the taxes, do we have the right licenses, so it takes a really long time for a merchant to get comfortable with letting us process, letting DLocal process their money. If they have to do that with different merchants in each of the 120 countries they sell to if you're a global merchant, that's unmanageable complexity. And the one DLocal solution is one pipe, same standard of care, we solve all your problems across multiple very complicated countries. And we think we're only scratching the surface in our ability to cross-sell the one pipe to multiple countries. I can't remember the statistics, average is 10 countries, should be much higher. We'll go to many countries, and we'll cross-sell more and more. And that is the way to preserve your gross margin for longer, by being able to solve the same problem in different customers with the same pipe to the customer. The third angle -- the third criteria we look at, does the team have the right go-forward capabilities. Is this the right team for the mission ahead. And it's undeniable that the team that DLocal has today has built an amazing business that's grown 10x in 4 years and been very relatively capital efficient and it's highly profitable. It's a team that's worked together for a long time. It's a team that's added outside talent to upgrade systems controls which are needed, and we'll -- it's a continuous need, that job is never done. There's always more to do. It's a system -- it's a team that's been tested by hard times. I think muddy water is made for a very horrible Christmas. I mean they're all Jews but it's still -- Christmas time was horrible for a lot of our -- not all, but some of the market. It's been tested by some tough times. It's been tested by some tough geographies. Our entry into Africa is hard. You think Argentina is complicated, get ready for Africa in the next few years. It's hard. It's -- the regulation is tougher. FX controls are harder and the DLocal is going to have to adjust to that. And they've proven to have the stomach for Latin America. And I say if you make it in Latin America, you can make it anywhere. So let's see if it applies to Africa. But I've seen that young team grow. I have seen Seba and Jaco grow as managers, and I'm very proud to have them as partners. I'm very grateful for the sleepless nights, on their hard work. And it's not easy. So I'm committed to the story, and I think we're not even in the second inning. So I hope you stay with us for longer. Thank you very much.

Hi, everyone. How are you? Good morning. It's great being here today. Before we go into the presentation itself, I want to introduce Sergio officially. Sergio is as of yesterday, our Co-President and Chief Strategy Officer. But I know Sergio for at this point in 20 years. And I think it's worth to share a little bit more on where we've known each other...

20 years, how old are you?

I''m now 33 as of last week. So it's really a long -- I know Sergio some from school. So it's in a long, long right there. So Sergio if you can introduce yourself.

Yes. Well, just to make it clear, we met in completely different context. In a non-profit that I was managing. And I always like to say that if you manage to make people -- motivate people to go every day to work in a non-profit without the motivation of the salary and the ability to fire someone, you are a great leader and you have shown that. About myself, I was born and raise in Uruguay. I started my career in Israel where I studied. I've been doing quite heavy R&D in the VLSI space in my previous liaison, I like deep tech. Then I did my MBA at INSEAD in France, went to work for Oracle, so I have experience both on the technical side and in IBM and in the Oracle which has the most amazing sales organization you can think of. And started by entrepreneurship career over 20 years ago, I've built and afterwards invested in many different companies. So I have quite a lot of experience in starting up a company. And we've started this company 7 years ago with Seba, whom we met a long time ago, but in a different context and then we re-met in a birthday party of all things, you want to tell the story of my mother-in-law?

And I guess the biggest conversations are one is about your mother-in-law birthday -- but Sergio it's great to have you on stage and joining us. I think Sergio experience will be extremely important to us as we navigate this new stage on the company. We have a lot to cover. Before we get right into it, we want to cover a little bit on the latest news in Argentina. We want to get that out of the way. It's very important for us to be able to discuss our story and where we are heading. So I'll let Sergio read a few opening statements and I'll come from then and we'll get right into the presentation.

Yes. Well, as you know, we have filed a 6-K document. So there's -- we cannot say much anything actually beyond that. What we can do is explain how we operate in Argentina. We accept payments from end users or companies for the largest merchants in the world, names that you'll see in the presentation. For your reference, our average credit card transaction in the country is just $6.5. So it's massive services. Then we expatriate the funds through various established and highly repeatable banks, both local and international, following the Central Bank rules. And also following different layers of compliance, both of the banks and of the regulators and their own compliance. It's not easy to move money around in these countries. I have a bank account here at Chase Bank, I send a wire, and that's it. In these countries, setting up a wire is much more complicated. You need to provide a lot of supporting documentation. So just to make it clear, contrary to what was reported in the press, every wire that we send has customer transactions behind it and it has supporting documentation that sometimes we are required to provide and we do according to the law. We have always operated within the regulatory framework, which has changed many times during the last few years, and we will continue to collaborate with the authorities whenever required. Again, we wanted to get this out of the way. This is not what we came here to discuss. We're going to discuss about the huge opportunity that we have ahead of us. So let's get started.

The only thing Sergio's story that allowed is that our business in Argentina is fundamentally the same as in every other country where we operate. It's the same merchant base. It's Facebooks and Netflix and Google, Microsoft is world. Argentina is complex. We believe in complexity, we add value. So we are committed to the market in the long run. It might be a bumpy road, but we're really, really confident in the way we've done things and the way we've operated over the years, not only in Argentina, but across every market where we operate. The standards are exactly the same in South Africa, in Mexico, in Brazil, in Nigeria, in Indonesia and also in Argentina. Now let's go to the more interesting part, if you don't mind. We're right here -- sorry, we're going to see a short video on who we are at DLocal, if I can make it work. [Presentation]

So a little bit of our history, Martin was covering and Eduardo was carrying around that. We started this journey in 2016. There was a clear understanding, both Sergio and I are [indiscernible] and we talked onto this. We come from emerging markets. And if you happen to be born in New York, and you want to buy from Amazon, you swipe your card and you buy online, one click, no friction whatsoever, and you get the product the next day. If you want to do the same transaction, but you were born in Nigeria or in South Africa or Indonesia or in Mexico, there's massive friction. We didn't know about all that friction when we started. We knew about the friction in Brazil. We launched the first payment method with [ BosValeto ], a cash method that has now been replaced by PIX. And we thought we have covered everything. We thought that was it. We had [ GoDaddy ], who was our first customer. And we said, okay, we have loved the world. There's nothing else to be done. We're obviously very wrong. And one of the things we understood is that this problem we saw initially in Brazil with cash methods wasn't only common to Brazil, not only common to cash methods, but it was something that was comping across the wider emerging markets. When we started to speak to our customers or our dream customers back then, so we went to Google and Google knew that they had friction. We went to Facebook. They knew they had friction. So what we've been doing all of this years is understanding that, that friction exists and listening to the merchant, saying, how can we reach those gaps? How can we really create infrastructure that would make it a level playing field. It should be the same way to pay and get paid in the U.S. as it is in Brazil. It should be exactly the same way to process up payment in Nigeria as it is in the EU. And that reality is not there yet, and that's the opportunity we are going for. The other thing I'll say is that this market is huge. And as Martin was saying, it only keeps getting bigger because again, if you believe that emerging markets are here to stay, and obviously, they are. And demographically, these are some of the fastest-growing countries on earth. Our market keeps getting bigger. I sometimes get questions from some of the people in the audience. Do you have enough atom and the truth is that I never think about it. It's never been a discussion in our Board. Do we have enough market. It's huge. It's huge out there. Our abilities -- are we going to be able to capture that opportunity? Is it going to be us or is it's going to be somewhere else? Are we going to be able to abstract all that complexity. So we really don't spend time understanding the size of this market because the market is absolutely massive. The last thing I'll say is that we bootstrap this company. 2016, '17 up to 2019 when GA came on board, we bootstrapped. And I think that has deeply affected our culture. We are frugal. We are not only owners of this business, but we act like owners. We are partners in this journey. This is not easy money that we were spending. It was our own and dollars coming out of our pocket. So everything that happens in our company, we take personally. You might have heard me say so, yes, we take it personally. This company is our life for better or worse. And we really believe that, that has ingrained who we are. We speak a lot about culture. Those early days have really defined us. We still remember where we come from, and we like that ambition of saying, okay, the opportunity this huge, we are going to go after it. But we know where we come from. And that balance is very important to us.

Okay. Sometimes people ask us if we are tackling a niche market. It's -- actually, we -- if it's a niche market, it's a huge niche but we are running on a secular trend. The same thing that Seba just said, it's something that's -- it's a huge and Seba told. There's a very big population in emerging markets. We all know that. There is a big and growing very fast, middle-class, urban, young, connected. Those are people that want to consume the same type of services and the same -- buy the same type of goods that people here in New York or people in London or wherever in the world want to consume. They -- many of them are educated, they are spending -- they are getting high education. They are learning online. They are learning the same way as my kids do, through YouTube or through Coursera or these different platforms. They are well trained. And they -- more and more, they are working as freelancers for international companies, selling their services, be it programming, graphic design or even driving a car, a ride-sharing car and they need to get paid. So we are talking about a massive population that is growing at 10x the growth rate of the developed markets. And it's a huge market that is growing very, very fast. That's the market we are going after. And the other thing is that these consumers are in a way forgotten. You try to buy something in this emerging markets. It's really how Martin already said it, we are repeating, but we really want to get the message through, there is a lot of friction. People wanted to buy goods or services, people wanting to sell these services, transaction cannot happen because the payment cannot get through. One example, I'm a fairly sophisticated user of [ payment vessels ] as you can imagine. Last week, I was trying to buy a ticket from Toronto to here. It took me 15 minutes to complete the payment because the credit, the billing address was outside of the U.S., but the credit card was issued in the U.S. And these are the type of nightmares that the consumers are facing every day. The ones who go through that trouble.

These are just some examples from the Internet. These are all public information. There are two things I would like to emphasize here. This comes from PayPal. This is some e-mail that went last month, sorry, announcing their users in Brazil that Pix wouldn't be accepted anymore. You know what Pix is. So Pix is the highest, more penetrated payment method. And PayPal is an amazing payments company, one we admire and they cannot accept Pix. So the amount of friction there is in the market, the amount of complexity, a global company like PayPal needs to abstract, really, really compounds when you think of it. Netflix. Netflix is not a payments business. The example I like on the right, and this is one that I'm extremely proud of. These are tweets from a user in Mozambique, asking Starlink to start accepting payments. We came in, we allow those transactions to happen. And now that user can buy Internet, can buy Spotify. And obviously, we're not providers of Internet and we're not providers of Spotify but when you generate opportunity and when you really -- sorry, create infrastructure, good things happen. So the friction is really real. And I know it's very hard to find intangible here when you're seeing in the U.S. But if you're sitting in Mozambique, in Nigeria or in Brazil, you feel that friction on a daily basis. This is what the problem is, and this is what the users want.

Sorry, if I may add to that, other payments companies, if they don't process a transaction, the transaction will be processed through another -- to another method. In many of our cases, if we don't process the transaction, the transaction doesn't happen. As I told you, I've invested and started a lot of companies, there's Y-Combinator, the famous accelerator. And I have this question when entrepreneurs apply. They ask this, "What do users do or go through now because the product you're building doesn't exist yet." And I want to show you some examples that apply to the market, to a products that we serve, things that people do in emerging markets when they want to buy stuff, and they can't. Maybe you have to use a VPN because of security reasons of your company. People in emerging markets, they all know what VPN is because that's the only way they can access different services. Sometimes to watch a movie, sometimes to access a, I don't know, in the case of China to access WhatsApp or different things. Prepaid cards issued internationally, and you pay a premium to get a prepaid card issued in the U.K. or somewhere else. Virtual phone number, so you can have a simulated presence in the U.S. And I'm not talking about anything illegal. I'm talking about people trying just desperately to buy and they cannot do it. And some people managed to run through all these groups boxes. You get a physical address in the U.S. where Amazon can send you a package, and these people will receive the package to your country. So the people who use these things are the most sophisticated users. When a merchant tailors its offering to a certain market, and it starts with payments, then they see their conversion rates go up by, I don't know, sometimes in order of magnitude, and they find an up top market where they have much less competition, and that's where we get in.

One of the things we sometimes struggle with is make this tangible. This is very conceptual. This is how it looks on the reality. This is our checkout from Spotify. In this case, it's a checkout in Mexico. This is how it looks in the left. Visa, Mastercard and Amex, pay now $10. Would like to understand how many -- how much you're going to be charged in local currency. You know only know once the bank said, if you happen to have an international credit card, you'll put it here, you get a payment, how much local currency, how many pesos you're going to be being charged, you don't know before you start. This is how that same checkout looks for Spotify with us in Mexico. You'll see those credit cards, but those are going to be locally acquired, which means number one, that anyone with a credit or a debit card is going to be able to pay. Number two, the user will have full visibility in terms of how much you're going to be charged in Mexican pesos. And there's a small thing there that says OXXO. I don't know if you see it from back there. Obviously, it's a cash method. People in Mexico pays Spotify subscriptions with cash. And Spotify has come up with weekly subscriptions. And I know this sounds super abstract. This how the reality looks on the ground. The other thing I'll say is that this example, we could do 900 times with 40 different countries and 900 different payment methods. All of this falls under one API. So if Spotify wants to do OXXO and then they want to do Boleto, they want to do Fawry in Egypt and they want to do Verve in Nigeria, they will need to reintegrate in example I gave, 4x. With us, all of that is attracted in only one AP. This, a Nike example. This example comes from Chile. On the left, you see a traditional checkout. On the right, you see the thing called installments. Many of you have heard now about buy now, pay later. Those of you who come from emerging markets, we've been paying with installments forever, at least since I was born. I've heard of quotas or parcela. And if you're a retailer and you don't offer installments, you are not really a retailer in these markets. We offer our merchants the ability of accepting installments without taking credit risk. We don't take credit risk either. We abstract, again all of this complexity. We give them the ability to get all the settlement periods together. And again, all -- these are all the small incremental things that make our company value. Martin was speaking about our margins. This is where our margins come in. Obstructing this sort of complexity. It looks basic. It's four boxes. It's really complex to run it behind the scenes. So we've come a long way. This is our growth curve, I remember very vividly a few years ago, not so long ago, we had an offsite meeting of all the employees. And Seba was saying that the dream of maybe one day processing $1 billion in a year is not that far away, and I was saying this guy is a dreamer. And today, $1 billion of pay-ins would be a very bad month for us. That's something we're used. This is our growth curve, and we -- this is -- in terms of TPV. I think we have a slide -- just a compensation on something here. In 2016, we processed $100 million for the full year. Today, we process $100 million in two good days or three bad days. And the reason we are saying this is, it's hard to get a payments business started. You need to get the trust of global merchants. You need to have the operations, you need to have the financial infrastructure. You need to have the licensing. So there's huge momentum. There's a huge inertia in our business. The fact that we've grown at this rate, I think it's a testament, not so much of how hard to work because we did work hard, but it's a testament of our strategy. We are indexed to some of the biggest global merchants in the world. And when you hold tied to them, you grow. So this is just a consequence of our strategy.

So this is -- we are not going to bore you, we're running a bit later with too many graphs, we'll let Maria bore you with the numbers.

Not bore you, amaze you.

But we've been growing very consistently, very fast. We were standing here in NASDAQ 3 years ago with a very interesting story to tell I think. Since then, we grew by a factor of 3 in all major metrics. Our volumes are more than 3x higher. Our revenue is more than 3x higher. Our adjusted EBITDA is more than 3x higher. That's super impressive. And as you know, there are very few companies that have managed this growth at this stage. And we feel that we are just beginning.

One of the things I will say is that when we went public, many of you were asking us, are we investing enough? It was a different world out there. No one cared what the bots on the right on the EBITDA. And we said, look, we care because we want to run a business that is sustainable in the long term. And we believe we might be old school, but we think profits are a good thing. And I think that alignment has paid off. These are the key metrics. You can ask anyone at DLocal, what should I look at? Look at TPV revenue, gross profit and EBITDA. Anyone on the team will know that. Why? Because if you run just a business based on TPV, but you don't get profits out of that, that's not what you want. And if you don't manage to turn those profits -- those gross profit dollars into EBITDA, then you are not really adding value to our shareholders. Diego will touch on this, about 76% EBITDA margin when divided by gross profit, it's best-in-class. We -- you've heard me speak a lot about Diego and how much I admire them. Their target is 65% in the long run. We are already at 75%. We want to keep the independence to invest because we believe the opportunity is massive, but we're already at our profitability levels that are best in class.

Sorry, if I may add to that, people ask us how are you so efficient? And the truth is that we are tapping on the best talent in emerging markets. And I've seen amazing talent. I've worked with the best engineers in the world, I've worked in the best sales organization in the world and believe there is the same or higher level of talent in emerging markets, and we can get that, and we can get that with a level of commitment of our management team that you don't see anywhere else.

On these slides, we're going to cover them very quickly. This is -- these were our internal targets when we went public. This comes from 2021, both at the TPV, revenue and adjusted EBITDA level. We did what we said we would do at IPO, not only that, but we've been significantly ahead of that. In some cases, 2x. In some cases, 1.5x. So when we sat down here 2 years ago and we said, okay, this is the vision for the company, we've widely exceeded our estimates. So we take promises or guidance really seriously. We are not in the basis of missing what we said we are going to do. And when I said that we take this personally, we really have our words back in what we said we would do. So I think this is very unique as well. We said we will do something. The market obviously changed, the world changed, but we've been able to deliver on that, not only that but much more. We're going to be covering for a few seconds on our culture and what gets us here. [indiscernible] has a short video and we're back. [Presentation]

So we would like to take a few minutes to speak about our culture. I know every company has values written on the wall, and those are worth not much. What really matters is how the company operates and the way we exist. We are obsessed with solving complex problems. The first time I went to India, I called Jaco and I said, Jaco, this is a nightmare, we should definitely do it. This is a market we need to be in. It's complex. It's volatile. There's full of friction. This is a type of market we need to be in. Because if it's complex for us, it means there's complexity for everyone. And if there's complexity for everyone, there's a problem to be solved. And if we solve that problem, we're going to be able to create value and capture some of that value. We like complex problems. You can tell. We want the most complex programs out there because the price is huge and the value added, it's massive. Speed. People underestimate the importance of speed. Doing things fast and iterating its essential. In emerging markets, things are complex. We cannot be perfect from day 1. We need to constantly improve. So recognizing that speed is an asset on itself, it's a huge, huge differentiation. Everyone can say their question, but I would like to give a few examples. We said we wanted to win in Africa. We made. We said, we'd launched in '19. In '20, we started to take it even more seriously. In '21, we said we need to win. Jacobo come on to South Africa. We're not telling other people what they need to do. We are walking the talk. If we want to win in Africa, you need to believe there. When we wanted to get our first Chinese merchants, I moved there. It wasn't easy. I don't know anyone in China. And today, when you look at our merchant base, many of those merchants are Chinese, and they're extremely relevant. So asking -- not asking others to do what you wouldn't do yourself, it's a key thing for us at DLocal, and we can give many, many examples. And the last point is that we want everyone to act like an owner. We are partners in this. And we want to be frugal spenders. We own this company together between the management team and some of our founding shareholders here. We own close to 80% of the company. We are totally aligned in this. And I think that also has a big impact on our culture. One other question we sometimes get, you hear us speak a lot about this one, DLocal concept. Feddy will speak about from a product standpoint. Maria will speak from a growth perspective, John will speak from a commercial standpoint. We sometimes get asked, how do you do so much with such a small team. And we made a very clear strategic decision when we started, which is this is one company. We are not 20 different payment companies under one umbrella. This is one payment company. It means one API, one contract, one team, one culture across everything we do. So having that ability is massive. Why? Because global merchants won't integrate you twice. The Google won't go through the process of integrating DLocal once in Mexico, and they have to do it all over again in South Africa. That will never happen. And Amazon doesn't want to have an experience where the experience they get in Latin America is great, but the experience they get in Africa, it's totally different or the experience they get in Southeast Asia, it's totally different. So you see that we run a very diverse business, a very geographically diversified business. We offer 900 payment methods, but it's one company. And I think that's a huge differentiation.

Okay. We're very, very proud of the list of names that -- of companies that trust us. These are some of the biggest names in the Internet arena. There are some names missing. And there are some names that you may not know or you may not recognize because there are some companies that have made their business of selling into emerging markets and they have gone through the travel and the process of customizing their offerings, preparing products, especially for emerging markets, customizing the website, translating, accepting payment methods and there are, of course, many other names that we're going last year, sometimes people ask us, haven't you capture the whole market? The answer is definitively no, because there are, of course, a second tier, third tier, and even the first tier is not complete yet. And as Eduardo said before, each one of these customers is working with us in some geographies, some with more, some with less. On average, our largest customers will work with us in 10 different geographies. We have 40, and we are adding more. So we'll continue to grow with our merchants in the geographies we are at. We will add more products, we will add more merchants, and we will add more geographies to the existing merchants.

The other thing I'll add is that DLocal has a very basic strategy. Here, your merchants are executing it. And we have the luck to have some of the best merchants in the world. We learned how to process credit cards from Netflix. Netflix taught as how performance in credit card processing worked. Amazon told us how scale looks. What's an SLA at scale. Amazon won't allow a 0.1% mistake because everything is huge. We learned from Didi. What an international expansion means and how speed is important. We generally been hearing and listening and learning from our merchants. So everything we do at DLocal is speaking a lot about this, starts with this lowest. We are indexed to their growth. And if you believe that emerging market, as I said before, are going to be relevant, and if you believe global merchants are relevant in those markets, I personally really believe in that. We are the best index for us. There's no better merchant than this and there's no better geographic exposure to emerging markets than the one we have.

Sorry, if I may add, many of the big tech companies are seeing their growth plateauing in the large markets, they still have a lot of growth in emerging markets. That's where they're looking at, and that's why they are coming to us more and more. We're just getting started. There's a statistic -- before I came here I run a report, in the last month, 40 million end users paid through our platform. That's a big number, 40 million people dependent on us and for transactions that, as I said, we're going to have happened without us. But we are operating in a geography with over 4 billion people. That's 1%, 2 billion connected people. So I mean, at least, I would expect at least, I don't know, 10% of the people to be paying for this type of services maybe even more, we have a lot of room to grow. We are just getting started. There are more geographies to cover. There are more customers to conquer, and there is a lot of more consumers to serve. We are super proud of what we built so far, but we are even more bullish about it coming ahead.

Just as one last comment, and I'll let Maria take stage. And this is [indiscernible] from Martin. Companies sometimes get lost in the short term. We all get very worried about the next quarter, the latest news and the latest tweets. And we are building this company for the long run. The opportunity ahead is massive. Emerging markets are going to be a massive driver of growth. And again, we are indexed to that growth. So as much as you can, I highly encourage you to look at the long term, really understand the underlying trends. That's what we are doing at DLocal, that's how we go through all this noise because we are committed to the mission and we believe on the other side of all this note, there's a massive company to be built. Thank you very much. Maria will cover on our growth vectors.

Now I can move the slides. Thank you, Seba, thank you, Sergio for the fantastic introduction to our business and overview of DLocal. I have many -- I have seen many of you before, and I looking forward to continue discussing our opportunity in our business. Now I'm going to cover three main topics here: one is our market opportunity; two, our growth strategy, how we have been capturing this growth and how we're going to continue to do; and the third one, our competitive and sustainable advantage. Starting now on our market opportunity. Our opportunity is huge. We are talking about $1.4 trillion in digital payments in emerging markets across the markets that we operate in today. If I know that everyone here lots to talk about drastic rate, nastic rate. If you do the quick math here, it is over $50 billion of revenue up for grab. Over $20 billion of gross profit and over $15 billion of EBITDA. But what excites us the most about this opportunity is that all those markets, they are very poorly served, as Martin mentioned earlier on. We are just scratching the surface. Even being the leader in this space, we still have less than 1% of the market opportunity. And what continues to excite us is the growth opportunity of these markets. There are very strong tailwinds in those markets. To mention a few Internet usage has continued to grow across our emerging markets. Consumer spending, the global consumer spending across the emerging markets is almost double what you see in developed markets. And combining the Internet usage with the changing behavior on our consumers, they are more and more preferring to shop online versus offline, you have the e-commerce penetration which is growing double digits in emerging markets. And when you compare Brazil, which is one of the most developed in terms of e-commerce penetration to U.K., we have basically a twofold opportunity just by doing that math, and U.K. continue to grow. This continues to supercharge our market opportunity, we expect to be over $3 trillion by 2028, with each of the market operating growing at least at 16% CAGR. Now that you have seen the massive opportunity ahead of us. Let's tackle how we have been growing, how we're going to continue to grow. Our strategy is based on three axes of growth: product, merchants and geography, and we're going to cover each of those. First, starting by product. You're going to see this many times today, and it's very important to have this in your mind. We sold for many complexities across 40 markets, 900 payment methods. What is very important. We have our merchants on the centric of everything that we do. Our merchants, Amazon, Google, they do not have time to think about the complexity of each emerging markets. There's not their core business. They have bigger things to think about. We sell for them. More than selling for them, we have to package this in a very simple way for them. And this is done through one API, one DLocal, is one integration. We cannot ask Amazon or Facebook or all the other logos that you have seen to do other integrations the first. It's only one. And with that, we enable them to truly access 2 billion users. And when I talk about truly access, is very important to cover like how the payment system works in emerging markets. If you're in U.K. or in U.S. with basically three different card schemes, you can cover more than 90% of transactions, Visa, [ Mastercard ] and Amex. In emerging markets, this is completely different. You have markets where alternative payment method is more than 50% of the overall transactions. You have like single payment methods specific to one market. I know everyone hear some of our Pix in Brazil, right? More than half of the population of Brazil used Pix on an active base. And as you have seen before, a global payment company, they are truly admire, they stop supporting Pix. It's not about just creating the connection. You have to enhance the connection. You have to continue improve. You have to compile all the regulatory chains. This complicates and it's difficult to replicate. You see the same spectrum when you look into regulatory points or tax or compliance, which [ Gaby's ] going to cover later on here. Every single market is different. When you look into Europe, you have a very consolidated regulatory framework, tax framework that applies across all the different markets. In emerging markets, they are completely different. Even in Brazil and Argentina being neighbors, they are completely different. So for all that, very importantly, connected to one single API. Now moving to our merchants. This is our most important stakeholder. I know that many of you are shareholders, but our merchant is on the center of everything that we do. Everytime that we have a product, geography, how you operate, we're thinking about our merchants. And this is the result of that. We have grown tenfold from 2016 to 2022 over the past 7 years, and we continue to grow. Very importantly, we continue to grow across various verticals. The way that we build our product is vertical agnostic. We can serve the various verticals. Also, the way that approach sales, and John is going to cover this later on, we also approach this being vertical-agnostic. We can serve every single merchant. Now moving -- once we win a market, once we onboard them, our focus moving to how we expand them, how they grow with them? How you continue adding opportunities with them. And this can clearly see though cohort analysis. From the time that we start year and year, we have been adding more geographies. We have been adding more payment methods. And this turns into a continuous growth of TPV, which is revenue, and you're going to exceed this on our financial results that Diego is going to cover later on. Now when you look into this cohort, this translates in our metric that we're also very proud of, our NRR. We have best-in-class NRR. Our NRR has been constituently outperforming our peer group, which is around 120%. Our NRR for 2022 was at 165%. And what is the opinion on NRR? First of all, churn, we basically have no churn. Our churn is less than 1%. Secondly, we grow with our merchants. We know that all these global companies, their growth comes mostly -- like the highest rate of growth comes from emerging markets. Then you have the share of wallet. The share of wallet is very important because this shows the satisfaction of our merchanting solution. They continue to trust more and more volumes with us. And this is a cautious decision that is taken every day. And then we have also opportunities which continue capturing by processing those merchants to new geography, new payment methods, making them -- enabling them to reach more and more users across emerging markets. Now let's focus on our share of wallet. This is a question that I get a lot. As you know, it's very difficult to find the precise numbers of share of wallet. But what we have done here, we mapped our opportunity for our main merchants. Together with them, we saw all the opportunities that we have with them across the market that we currently operate. And we're still just scratching the surface. We have 10% to 12% of share of wallet. Just by that, there is a 5% to 10% fold opportunity. And why are we so confident about that? When you zoom in the share wallet that you can capture within one payment method in one geography, we have been consistently doing for our merchants. Let me explain here. There's a lot of information here. We have here three examples of three different merchants. The companies are very well admired by everyone here. On the top part, we are looking to how we have been growing our share of wallet within one payment method in one geography. On the first one, this is the largest social media company in the world. So we are working with them in Brazil. If we take the example of one alternative payment method in Brazil and how we have grown with them over the past 4 years, we got to 50% of the share of wallet. Second example, [Verve] ride-hailing company. In Mexico, if you look into credit cards and debit cards, we got to 90% of your share of wallet. And this is also true for South Africa with one of the largest fashion growing e-commerce in the world. So we got to 100% of their share of wallet. This shows the trust that our merchants have in our solution and how we have been consistently showing better performance than peers. In the meantime, those merchants didn't stop with us with those payment matters. They are consistently growing countries, products and payment methods, which have been consistently enlarging our opportunities with them. Now let's move to the third axis of growth geographies. We started in Brazil back in 2016, with one payment method. Since the beginning, we harbor global ambitions. And over the past 7 years, we added 40 geographies, over 900 payment methods. We enable each merchant to truly operate across emerging markets. How we do that? We have a consistent playbook that has been tested many times. How we have been a success? We are a global company. We serve global merchants, but we leverage local expertise. When we think of expanding to our new markets, we started typically in the discovery phase. And as you know, these stats reflect an ask of a merchant. The merchant needed in a specific country. We also look across our base, what are other merchants would like us to be in that same country. We analyze the market attractiveness of that country. As you know, being profitable is in our DNA. And we want to be profitable in each region with each payment method from the outset. We analyze also the payment ecosystem, the regulatory ecosystem. Once we decide to launch, we move to the next phase. We build a starting. And at starting we mean, we leverage DLocal. So as you have seen, serves and spent time in China, how we spent some time in Africa. And we hire local expertise. We hire local talent. We also keep ourselves with the best experts in the region, the best experts from a regulatory standpoint, from a tech standpoint of payment standpoint. We collaborate with the regulators. In many cases, we come into a geography that they do not have any an evolved framework for payments. We collaborate with them. We partner with them and help them evolve this framework. Once we enable the merchants to operate in those geographies, then we move to the next phase, accelerate. We scale our volumes. We bring more merchants in there. We build more connections. We improve our connections, improve our conversions, like this, we improve performance, which also translates into our numbers. Here I have 2 examples of geographies that we expanded. They are very different, as you can see, Morocco and Philippines. But when you look into the pain points, it's very similar. We had the merchants asking us to go to those geographies. We had a very fragmented payment space, where in Morocco, 5% of the population could have access to international credit cards. More than 50% of the transactions were done from alternative payment methods. Competition. There was no global payment companies serving global merchants. They would be there only through international acquirers. And as you can see, with that, you only reach 5% of the population or less. We collaborate with the regulatory authorities to build a framework. We got a license. And what was the result of that? Besides enabling global merchants to operate in those countries, we also improved their conversions that we were seeing on their credit card transactions by at least 40%. Now let's talk a little bit about how these 3 axes play together, products, geographies and merchants. The way that DLocal platform is built for every product that we add, that product is available across geographies. There is a network effect on that because everything is connected through one API. So every combination of product and geography, it is automatically available to every single merchant. When you look into the slide here, you'll see that at the end of 2022, we had more than 100,000 potential connections. This means our current or potential stream of revenue. This is a combination of merchant, products and geography. In 2018, those potential connections were like 5,000. We have been growing exponentially. And with that, we can assist more our merchants. If you compare a merchant that comes in 2018, they had one connection, one merchant, one geography, one product. We have merchants that started in 2020 with 10, 14 connections. And very quickly, they expanded to 40 connections. There is a massive opportunity just inside our installed capacity. And we continue to compound on each of those axes. Now let's see our competitive landscape. There is no one doing what we're doing. We wake up and sleep every day thinking about the emerging markets. How it can be better in emerging markets. And when you look into the potential competition, so the first one that we have here is Adyen. We highly admire Adyen, but they are focused on developed markets. We -- as I said, we wake up and sleep every day thinking about emerging markets. Other ones that I think that are worth to comment here. International acquirers, as I said, with international acquirers in emerging markets, you are reaching 5% to 10% of the population. You are not truly enabling global merchants. Then you have regional PSPs. They can have some global merchants, but they do not serve like the same kind of global merchants that we operate. They cannot serve to the same extent. Very important here, many times, they might be operating across 3, 4 geographies, but it might be required for merchants to build another connection. Can you imagine asking Amazon, I have an integration here. It's great, but you're going to have to build another one to operate it for us in another geography. That's not possible for global merchants. Those are the most demanding merchants. So with that, we have confident that we are like positioned to be the winner in this space to capture this huge market opportunity ahead of us. We have a unique product that is difficult to replicate. We have been growing exceptionally for our merchant base. Our merchants trust us and they continue to trust more volumes every day. They take the decision every day. We have an outstanding playbook to expand to new geographies. all these compounds, and we have been consistently widening our moat. With that, you know that at the local, we are obsessed about execution. I'll leave you with Jaco our Co-President and COO and Moses to talk about like how we have been expanding and being so successful across major geographies. Thank you.

Jaco you're in the hot seat and I'm super excited to have this chat with you today because the first part is that you were in day-1 staff of the company. So in the early days of start ups there are broad things that come to mind. The first is the product you want to build. The second will be the market you want to take it to. 2016, when you guys were thinking of DLocal what were the things that you have seen from those early days in terms of the strategy for the product and also the market you went into. What shift your mindset?

Sure. Thank you. Hi, everybody. Thank you. It's a pleasure to having you here. So very early days and while we were building the company, the product, our geographical footprint, learning from customers as well, which has been in essence as a company since day 1, there were 3 big lessons at the time. Firstly, it was about having the local people in the ground, the importance of having people in each of the emerging markets we were operating. It's important to have people -- it was important to have people in Brazil at the time explaining how Boleto works or how online transfers or debit cards in Brazil, it works. It's exactly the same -- important to understand how M-Pesa works in Kenya or Fawry in Egypt or UPI in India. And all those local know-how you only get it when you have local people in the ground. So for us, that was -- has been key as a company since then. Second thing is defining a framework and a playbook in terms of how to expand. Being a global company while you expand more and more, and you manage to learn a lot on what works and what does not work. And we took a lot of those lessons. We defined all of that into our framework and the final playbook on what to execute when coming to a new country. And the third one, and I think Seba touched a lot that, Maria just touched now with all the platform. When you want to serve merchants under a single API and you go to so many countries which have many different behaviors. It's super important to have a flexible platform. And the reason why it's because you want to keep adding new services to that product, to that platform, and you don't want the merchant to continue making new integrations. So under that single API, we understand the importance of having a flexible platform to be able to serve -- to have Boleto, but at the same time do process cards and to keep adding UPI and then M-Pesa, which is -- works totally different than 3 months ago. A new payment system came in South Africa, which is [indiscernible] which is the UPI version for South Africa, in [indiscernible] and Nigeria and so on and so forth. So the importance of having a flexible platform, it makes the whole difference to continue growing the product and [ in ] new geographies and [ in ] new options for our merchants.

Interesting. How it is. And I think coming from Africa, a Nigerian, who -- I think there 3 things that we had that always made things difficult, just speaking for Africa. The infrastructure, the infrastructure is super very inadequate. The second part is also reliability of systems. The third part is, the international standard that most of the global brands would expect, you don't have those behind-the-scene sales support. And so when you put these 3 things together, a shortage of infrastructure, the standard for reliability and also aftersales support, which is typically what you call customer services. I see those things were the things that are super lacking in the continent and yes, I think the DLocal is done well in that area. The second thing I wanted to find out like everyone here year, DLocal has started out from year one -- the founders are from Latin America. Most of the senior leadership team from Latin America. And we've seen companies that start up from Latin America tend to expand regionally. So that means from Brazil, you expect to go to Mexico, Paraguay and all of the stuff. You took a bold step to expand globally to leave Latin America, to go to Asia, to come to Africa. What gave you guys the impetus to do that in the early days?

So -- Maria has presented the evolution in our geographical footprint. We started in Brazil first, then we go to the rest of Latin America between 2017 and 2018. Merchants were, to be honest, I remember back in -- early in the days being in Palo Alto at Facebook offices, which was a customer at the time, and they asked us our ability to solve for them 13 countries in Africa same way we were doing for them in Latin America. For us was -- for me, personally, it was the first time I was hearing about payments processing in Africa to be honest. They asked about Egypt, Morocco, Nigeria, Kenya, South Africa, Ghana and the list continues. Very close in time happens the same with booking.com for Morocco. They were having challenges to collect their fees from the hotels in Morocco for those which are familiar with Morocco dealing with what's called the ODC, which is the exchange office. It's super complex. So they were -- we then didn't have a local presence to handle a lot of that complexity. And also Netflix came and asked us for Nigeria which [indiscernible] has close to 40% of [indiscernible] for those which don't know [indiscernible] it's a local scheme, which can only be processed locally. So if you want to offer and accept payments through [indiscernible], you need to have local presence and Netflix was not being able to capture all their consumers, which were [indiscernible] cardholders. So those were the 3 first times where we started hearing about outside Latin America, and we said let's try -- let's give it a try. Let's understand, let's learn more, and that's how we went first to Morocco in 2018, then 2019 Nigeria. And then we -- when we put our feet on the ground, we started realizing how complex those geographies were decided to continue expanding and spreading more and more in Africa, in Asia, very similar happened in Asia in 2018, India. That's how we go to outside of Latin America.

If I hear you clearly, you are saying the expansion into the rest part of the world has [indiscernible] a show?

Totally not. Totally not. It was, again, merchant-oriented. We had nothing at the time, but merchants trusting on our solution and seeing our ability to execute and to solve complex problems in emerging markets. I think as Seba said, when he spoke about our culture, it's our ability to execute. The speed, understanding merchant needs. So it's not a show at all. We were 3 years ago in 28 countries, we are as of today in 40 countries, close to 28% of our revenues are Africa and Asia. So for us, it's a reality. We are solving a real problem for our merchants in those geographies.

As the Co-President and also the Chief Operating Officer, DLocal operates in 40-plus markets, and about 15 time zones. So that means you have people scattered across different parts of the world. Operationally managing these markets and also managing the people. What were the key strategy starts...

Can we answer that we -- we would have to -- but feel free to complement. I would like to answer your views so -- I think it's all the culture. It's about having a very strong identity and culture as a company, which blends. Again, it's the culture which blends corporate culture plus local flavors. It's important to understand what we want as a single company. What's the finance. And again, Seba touched on the -- on a few bullet points of our culture, making sure we spread that all around each of the places we have people. And then we also managed to combine that with the local flavors to understand how it's Nigeria, how it's South Africa, how it's China? How we see India -- for example, a few things we -- we send -- we empower people to move to other offices to spread that culture around. We have people coming from Uruguay to China for 4 years. We help people which move from Uruguay to South Africa for already 2 years. We have people which spend time in Nigeria, myself, I went to Africa. So that's -- that's the way we manage to handle our global companies having people in 15x or so over 40 countries. And again, and it's also our people making that incremental in spreading that -- how do you say...

Yes, being yes, I think I'll be one of the biggest beneficiaries to that so -- you talked about the first part, which is the strong execution mindset, of course, form the center because you've done it extensively, maybe in Brazil and some of the other markets, taking advantage of also the local knowledge, domain knowledge in the region, quite [ supplied full ]. Maybe once in [ 10 years ] sometimes we think -- I can imagine we've heard so much about M-Pesa from Kenya. And so you know Nigeria, Nigeria has lots of payment methods. Now Ghana is very close to Nigeria, just like an hour flight. And the expectation is if East Africa is for mobile money, similar we think in Ghana is almost similar to Nigeria in terms of the payment methods. And so Ghanian looks like Moses, almost speak like Moses. But in terms of payment methods, they are totally different. Ghana is a big mobile money country. So you just want to have those kind of nuances, they induce increases of each of those markets and aligning that with the strong execution mindset coming from the center, yes, it truly helps us. yes.

And I think the fact that we have managed to share a lot of time to where also was key for us to understand how each of the market works. I remember all the [indiscernible] say, we went in Kenya, in Nigeria, the local houses, which is supplying [indiscernible] to our people to get along together in South Africa. Some memories at the time in Kenya. We were with Federico, which is sitting there will be presenting our product. We're going for a hiking in Kenya, suddenly as the bus say got a puncture and they will -- in the middle of the road. So we all need to leave the bus. People came to change the wheel. We were in the middle of nowhere, kind of country side. So some art designs, which we're living in the countryside came with their handicraft, trying to sell up some local things. Our honest question was how do I pay? Honestly. How do I pay? I didn't have any cash. I only have card at the time. I think what's the same pace for all of the team. and they got a phone, which was not even a smart phone.

A smart feature phone.

A feature phone and say you can pay me through mobile money. I give you my mobile number, my phone number, you make me an M-Pesa at the time I have an air telephone, and I said, but I have there, but then no worries in the inter-payable. You can send me my through the phone. So that's where we paid. I end up paying with mobile money in Kenya. And I realize how important it was to be -- it really looked I was -- I think was one of the first time when I realized the importance of in Kenya, particularly offering mobile money. So all those experiences and having the local people, right, and saying, no, forget about the card. Like you will not pay with card here, like you need to have mobile money has been key.

I think this is quite very insightful. Seba talked about you spending time in Africa. You were in Africa for 6 months, 6 solid months. And I haven't done it from Uruguay, like you've done it from the center. What were the things you lent, what were things you saw when you had to stay in Africa?

Everything.

Do you want to...

We'll say -- again, we started expanding on or putting our -- given our first steps in Africa in 2018, 2018 -- the theory is completely different than the reality, to be honest. One thing it's how do you think a market works, and other thing is how you see the market works. So my first time in Africa was early 2022. After COVID, I wanted to do it -- I wanted to make it in 2021. I couldn't because there was a second wave of COVID in Africa, so I couldn't fly there. So as soon as I could, I went to Nigeria and South Africa first to meet the market. I remember that time I was on the flight, flying back and I started typing things I learned. And not only things I learned, similarities I was seeing between some countries in Africa and a few things we saw before in Latin America. Nigeria penetration, same as Brazil, South Africa regulation and licenses, very similar to Brazil, FX capital -- FX capital restrictions and so on and so forth. So it was -- again, the ability to learn about M-Pesa. They have anything to learn about or tell where we need to understand Fawry in Egypt or NIP in Nigeria or credit cards or 3DS or Tanzania, mobile money as well, Ghana, highly penetrated on mobile money, super important. But more than that also was the ability to be letting -- at the time we were 5 people, I think we are as of today, we are 50 people in the ground, local people. We managed to build a strong presence. Also the opportunity to meet with regulators, super important. We have as of today, for example, a PSP license in Nigeria, a PSP license in Kenya, we got license in Rwanda a month ago, a system operator license approval in South Africa and many more. So having a chance to meet the regulator, explain our business, explain what we were doing, what we were bringing to the continent was super important. And then meeting with customers. For the first time in years, we managed to capture customers in Africa. It was not only bring international companies to come to Africa. It also was the ability to get us -- the companies to go to our countries as well or go within Africa, which is huge. So I would say those were key things.

Yes. Okay. I think I also benefited from one of those sessions when we did a commercial strategy for the teams from Africa. We got them -- everyone into Nigeria and the were key things with them, one of the questions beside the DNA stuff Seba talked about. How the things are possible when you went to meet with the Central Bank Governor in Nigeria? It just tells you that fintech and go to meet with the regulators and just provide insight to them. The second part is commercialization. Again, that is one of the things you talked about how we're now able to get local merchants to grow outside of just Nigeria. So it helps listening on the ground just to understand how to commercialize things we do, especially when things are very complex. So yes, if ...

And 2 more things to add. It was also a demonstration. It was a demonstration and Seba touched on that before it's -- demonstrating that what we want to do today, we need to be the one -- the first one in the line in order to make that happen and need to be on it as well. And have some fun also.

It brought some level of believability, that is not just a Latin American company. So that you stayed in the region means that you are truly going to be Africa. So -- and we saw the kind of people that won't have to join DLocal from there, like we grew as from recurring terms of even human resources. So that's true. Yes. I want to -- we hear cross-border, we hear local-to-local play. And so again, just making [indiscernible]. What drives the cross-border, like why do you have to do -- local-to-local cross-border? Like I did the same thing in each markets.

I think it's about it's an option -- into merchant. It's more about a merchant decision. Again, we understand we are solving same level of complexity, either local to local or cross-border, platform is the same, payment methods are the same, most of the licenses are the same, integration is the same. So for us, the difference between local to local and cross-border it's more of about where the merchant want to get settled. If they have a local entity and they want to get settled domestically or they don't have local presence and they want to get settled abroad. It's one more building block. It's one more level of complexity welcoming from our merchants when we are selling them cross-border. But at the end of the day, we're agnostic because we see merchants as global. So we are not going after the merchants, which want to do one payment method just in one country. We're seeing ourself as an enabler for merchants to get access to more and more local payment methods. And sometimes, they might want to get settled in Brazil locally, for example, or in Nigeria locally or in Kenya locally, but in South Africa cross-border or in Indonesia cross-border or in India cross-border. So it's again, it's one more flavor we give to our merchants, but we are agnostic. We are solving the same level of complexity. We're running out of time. Just one for you. What do you see next for Nigeria being Nigeria? And what would you attribute the local success in Nigeria, if I may.

Nigeria. Maybe something everyone would dress like this.

I have mine.

Yes.

I didn't bring it but I have mine.

I think the fundamentals around the country will continue to be very strong and the same. So we've had 250 million people in the country. I think it's not just the data of 250 million. It's the -- what mix of that 18%. I mean the chunk of Nigerians will -- average of 18 years. So it just tells you these people are useful. These people are the digital natives of today. These are the people that will buy things online. These are the people that will do e-commerce. And so that is something that is very variable. The thought in will be Nigerians love to travel and same does for us. So that means you see lots of people move and end from other parts of the world and send money back home. So in sending money back home, their loved ones can continue to spend like every other person. So that's a [indiscernible]. But I think the finest thing is that some [ of in those ] complexities we talked about in the early days. And so as we solve those complexities, more and more people not afraid to pay with Netflix, not afraid to play with Spotify. And as we solve those, more people will come into the space to play and Nigeria will continue to grow. Above all, Internet penetration is to grow. When you compare Nigeria to Brazil, we've not gone anywhere. So as more people get into the safety nets, we see more that we can reap from the region.

And if I can add to that, I remember at the time when we launched in Brazil credit cards, if you want to make an inpayment using a credit card in Brazil was probably -- mostly impossible or very difficult, Nigeria is having very similar trends today. All banks are asking merchants to come local and processing nairas and not longer in U.S. dollars. And we are seeing more and more [indiscernible]. Thank you very much.

Thank you. Thank you. Please let me give you a round of applause. Thank you Jaco.

Thank you. we will leave the stage to Gabi, who is our General Counsel. She will touch on compliance, regulations and legal. Gabi, all yours.

Hi, everyone. Good morning. Very glad to be here. My name is Gabriela Vieira, as Jaco said I'm General Counsel at DLocal. I have a masters in Ph.D in international law, and I'm extremely passionate about what I'm talking to you here today. I want to talk to you about how we navigate global regulatory complexity for our clients. And more specifically, how we actually deploy local expertise, how we years -- how we built and how we continue to use the toolbox to apply for licenses in each country and also how we became to be local experts for our clients as well. So you heard this before, you saw this slide before DLocal makes the complex simple. And it's important to say that when we talk about FX, regulation and compliance, this is an incredible -- incredibly complex environment that we are talking about. We are talking about different currencies, different regulatory frameworks different reporting obligations, different taxes, different customs, so many different types of law and regulations. When we go to developed markets, such as the U.S. or even the European Union, there are certain principles or directives that allow the loss to be harmonized and to leverage certain experience in one country to another in a more easy and seamless way. That is not happening in emerging markets. Those are very, very distinct realities that we are facing. So that being said, emerging markets, they are diverse and complex and the regulations, they are diverse and complex as well. We know that each authority are trying to address the risks of their countries, and they're doing so and also in their best abilities. And we need to understand what are those risks they are trying to address. So we can keep on the top of that curve as well, not only while we enter, but while we stay and progress and advance in the country. So again, the regulation in emerging markets, they are ever changing. They're always evolving. There is a lot of those countries that are still addressing the digital commerce. So they are realizing certain gaps and regulations or certain parts that they could improve. So this means a very, very dynamic regulation. And this means that our job doesn't stop when we enter the country. it continues day -- today in each of those countries. And how we do that? We are local. You heard us already today, but we have people in the ground. We want to be close to the financial regulators who are the ones that ultimately would decide what type of participants they want in their financial systems. We are also close to the tax regulators. They're the ones that are going to tell us how we account for taxes in each country and FX rules as well, that's very important, that's how we would define how the money flows in and flows out in the country. So we need to be local. We need to be local in order to be able to address all of those points. So our solution of one contract, one API. He actually has a full localization layer of compliance, regulatory and legal specificities. So as I said, we have local people and we also leverage a very intensive expert network in each country. We also demanded that we partner locally. It's also with the goal to achieve that specific payment method, that specific tool that will help us even like monitoring the transactions that we are handling in that country. So this is a full 360 compliance legal and regulatory partnership with not only local partners, experts, but also with our merchants, right? We have very demanding merchants. They don't expect us to say, "okay, I can process in this country that's it." We need to explain to them why the license we have are enough, why the activity that we have in that country follows local regulations, follow FX rules, follow compliance standards and why we are not going to be blindsided by a different change in regulatory framework. So this is -- it's a process that, I mean, I worked a lot with John as well, [ hand-to-hand ] some clients explain why we are there. But also in the day to day. So when something changes, we are there to say, "okay, we are seeing this coming, we are top of it. We are ready to adapt." So yes, as I said, one contract, one API, we can offer local, international settlements with that one contract. But that unfolds this full local compliance layer of it. We have the licenses, permissions and authorizations that we need in order for our merchants to be able to receive the money that we are collecting on their behalf. We also have very AI-driven fraud and financial crime prevention. We want to make sure that everything going through our rails are legitimate transactions. We also have tax management. We can tell them, "okay, this is how taxes apply in these countries, especially local to local, cross-border." We can help them to also seek local partners for there own also advise and benefit. We can say how the FX rules happens, how we manage to collect, expatriate their banking partners, FX partners, FX broker partners, et cetera. And again, we do this with all those changes and with all the changes in regulations that might come. And yes, and that's why I want to talk to you like in the next slide. It's going through each of those items more specifically. So this is our regulatory infrastructure, which I'm personally very proud of. You can see that there are different types of licensing colors in the map you're going to have those where we already hold a license registration, authorization, et cetera, depending on what is applicable to us, of course. There are other countries that we are in the process of applying it. There are countries that we don't need a license just because the regulatory framework is not yet addressing the activities that we are performing in the country. And among that and even in every one of them, we can also partner with our ready license partners, and then we get efficiency after. So we can learn with a specific local partner, and they would say, okay, actually, that license interests us, let's apply to it, let's have it directly and then we can move and have a direct license and a direct contact with the regulator. And I think I missed, sorry, the green one, which are countries where we have 1, 2 type of license, but we are applying for other ones. And that's just how diverse the regulatory framework are in those countries specifically. It's worth mentioning that we don't only have licenses and registrations in emerging markets. We also hold in developed markets. because we need them to be able to settle to our clients. And I'm going to give you some examples. In Brazil, for example, we are [ some ] acquired. We are what we call an [ EFX ]. We are also a participant in PIX. So we are within the infrastructure of the PIX instant payment system. We are now also in the process of application about a full payment institutional license and also a payment initiated license. And the reason why we have so many different figures is because Brazil is very dense, regulatory-wise. And they have a specific regulation for each type of activity you're doing within the payment ecosystem. Another example is Nigeria. I know you heard it. Jaco mentioned, Moses mentioned, we are paying -- a payment solution service provider there. So we are able to collect funds there, connect to local acquirers and then remit those funds abroad through licensed banks and FX brokers. We also have, for example, the U.K. after Brexit, we -- before Brexit, we were able to serve our U.K. merchants through our European license. Because of Brexit, we apply to a temporary regime, and now we are in the process of getting a license -- a payment institution directly with the [indiscernible] -- and just a last example that -- it's a bit different for the previous ones, for example, is the one in Philippines. In Philippines, we are registered as an operator in the payment system. It's very different from the other ones, but it's so full of nuances as well. So it's very interesting to see how each country address their payment ecosystem differently and to be able also to learn and to navigate that, personally this will make my job a lot of fun. And these, I just want to show to you how we have been more and more efficient. We now -- how we apply to licenses. So the more we are going through that experience in different countries, we are developing a toolbox that serve us to keep applying in new countries to leverage our knowledge, to understand also how to explain to local regulators what we do. There are countries that they might have a very strong local payment ecosystems, but they are not maybe so familiar with the cross-border payment scenario. So we want to be sure that we are transparent. We've reach out to the authorities, we say that's what we do. And sometimes, the regulation might be clear of what we need to apply. Sometimes less clear. So we need to make sure that we also have the dialogue so we can apply and be able to move fast because if we are able to go there and talk to the regulator, like for example we did that in Kenya, that's what we do. What do you think is applicable license for us. We did that in Indonesia as well. And they say, "look, for whatever ABC, it's the one that fits the most here." So this is how we have learned to gain time and leverage our expertise and be faster every time we go to new markets. And again, this is not only by entering the market. We need to keep that in every single day throughout our presence in that market. It's beyond entrance. Those markets that are -- any market actually, they are prone to change. And even more so when we are talking about 40 emerging markets would -- are keeping developing involving their regulations. So again, I mean, just here, I just want to make the point that we partner with local experts. We have our people on the ground, and we partner with local regulators, such as the examples I just told you. Tax and FX rules. That's another very interesting element of what we bring to the table because, again, there's no unified way approach to taxes such as in European Union. So this means you go to each country and understand how that applies. And one -- for example, one of the question we make ourselves is, can the local collect and pay taxes on behalf of our customers. Can we not? Or actually the law doesn't address that? And we have very tangible examples, let's say, in Argentina, for offshore merchants, we have to and we do collect and pay taxes on their behalf. But there are countries such as Egypt and Nigeria that we are not allowed to do so. And both regulations has this own reason. In Argentina, they're saying, "You are the last mile in the country. So you should be doing this." So we ensure that taxes are being collected. When we think about the logic with -- in Egypt, in Kenya, sorry, I think I said Nigeria as Kenya. The logic is a merchant could have more than one thing on provider. So actually, I need to go to the source of information, which is the merchant. So again, it's different ways to approach sometimes the same need, which is collect taxes. But they are addressed with their own uniqueness. And we just need to make sure that we are there, we understand and we can act when possible on behalf of our clients if they need to. I think what we are also very proud is the way we mastered our local-to-local tax payment. We have been -- we collect like normally, we are withholding agents in the local-to-local flow. And we actively also talk to tax authorities to say, "look, this is what we do. So these tax we are collecting actually should be a credit of our merchants." So we try to create value even sometimes when the merchant is not asking because we understand that, that's the chain, that is what a payment processor needs to view in that flow. And we believe in being transparent and letting the authorities know what we do in that and what is our revenue, what is the merchants' revenues and therefore, their own credit. And another layer is compliance, right? We handle data in a very unique way. Our systems are very technology and AI-driven. We monitor the transactions as they through our systems. And we crossed that data among countries within a segment specifically, so within merchants within a segment, and that allow us to make sure that everything going through our rails are legitimate transactions. There is like a very good example with one of our providers because we make sure we use the best available systems that they are there, that when we turn them on, sorry, we were able to see a specific flow of a user that she was doing cash-in in Mexico, cash out in Brazil, and that was continuous and that, of course, raises some flags from our compliance and transaction monitoring team. I don't think other payment company would be able to detect that in the way we did because that user was using different ID numbers, was using different personal data. So how could we actually identify that, that was the same user. That's part of our AI-trained model that says, okay, I can finance [indiscernible] and the other one that came from [indiscernible]. And I can have a passport or national ID, but that's the same user. So I need to make sure I can address the behavior of those users in our systems. Why merchants chose us, we believe we have an unmatched solution because it goes further, which -- I mean the part of our core solution is product, the way we interact with our merchants, but we do that with a layer of compliance -- regulatory and legal compliance. So for us, this means that we have a very strong solution, and we do that in one of the most difficult countries there are. And yes, they can rely on us to navigate through those changes, as I said, to explain them some uniqueness of the markets and how regulators are also thinking, they know that we interact with regulators, we try to seek what is their mindset. And again, that's also why we are ready to tackle new markets and new realities. We also share the mission of those countries. We share the mission that we need to empower consumers and sellers in emerging markets. We need to empower the emerging market in itself. And we believe in financial inclusion, we believe in sustainability. We believe in all of those things and the local authorities are trying to address. So this part, this is core to our product as well. And thank you for listening to me. I want to hand on to Federico, who will talk about products.

Hi, everyone. Good morning. I'm Federico Mazzoli. I lead product at the DLocal. Everything you've been hearing so far, it's really complex, especially considering the size of DLocal today. The only way to achieve what we are building is relying on the biggest leverage there is, which is technology. Over 40% of our head count is technology. So we are basically a technology-first company. Today, I want to tell you about some of the products that we are building at DLocal, but most importantly, how do we decide what to build and how do we make it happen. On our mission to build the best payment infrastructure in emerging markets is key to build products and services that are up to the expectations of this global enterprises. That means building the tools to manage payments in 40 countries, a breeze, but at the same time, building a payment experiences for customers, which are both modern and adapted to the latest UX trends on the industry, but at the same time, feel familiar to the average consumer in the countries where we operate. Let me show you a few examples. With Meta, we launched in over 14 countries in just a matter of months, priority months, where we developed a bunch of custom-built payment experience using alternative payment methods. One of those examples is PIX in Brazil. As it was mentioned before, PIX is right now the top alternative payment method in Brazil by a mile. And for Facebook, we build custom payment experiences. So Facebook didn't have to lift a finger. It was all done by DLocal. Now users can pay for advertisements on Facebook, thanks to us. For Amazon, in Chile, we built a white-label payment experience where the user cannot [ tell ] that Dlocal is behind the scenes for them to pay with local cards in the country. Not only that, but we also enabled installments which was a first for Amazon worldwide, and that is key in Latin America. For Spotify in Kenya, we enabled them M-Pesa. As Jaco mentioned before, M-Pesa is everywhere in the country. It's the most relevant payment method out there. And now users on Spotify can pay for packages of Spotify Premium, either monthly packages or weekly packages using any feature phone. In fact, the weekly package is only available using M-Pesa, both because it's cheaper and it's also the most relevant payment method for their target audience for the product. Philippines has a very low market penetration -- banking penetration. Only about half of the population have access to a bank account. By combining payouts to bank accounts and to e-wallets, we've managed to accomplish a 99.5% payouts approval rate for deal. And of those payouts, about 1/3 of those are made to e-wallets. But if any of these merchants wanted to launch any of these experiences and even expand to other countries, they will have to partner with dozens of different providers around the globe. But we've centralized this in one place, and we provide the tools to do so. From a centralized reporting, where you can see all the transactions around the globe with all the different payment methods from one place to refund and chargeback management from one spot to tools for the fraud prevention teams so they can dispute chargebacks in many countries at once. Now how do we make this happen? How do we decide what to build and how do we do it. So first of all, we are B2B native. This means that we've been working with enterprise companies since day 1. That has been our focus. Our product team works very, very closely with our key customers. In fact, our product road map it's directly driven from the feedback of our customers. We're not trying to invent the Metaverse anything. We just listen to them. And by listening to them and these big companies, they -- obviously, they require custom solutions. And we are there to help them. Whatever works in the U.S. and Europe, the markets that they are usually familiar with, will probably not work in Africa, in Asia and Latin America, and we are there to bridge that gap. Second of all, we prioritize our developments based on their business impact. And for this, we take a very first-principles approach. Basically, our utmost priority is keeping the business continuity. That means keeping our platform secure, scalable by very diligently automating every manual process that's out there, but also adapting to the ever-changing local regulations. But as important to keep the business running, we need to make it grow. And for that, we use the gross profit as our north star. For every new development, we analyze -- we work very closely with the commercial team to analyze how much new TPV is that development going to bring or with our operations teams to see how much cost we're going to save by developing our features. By using these metrics, it allows us to be very aligned with the rest of the company, and that's super important. Our One-API principle that you've been hearing before is at the core of everything that we do. We've said this already, but by integrating to our One API, we have access to all the features that we offer in all the different markets. This is key because every feature that we built for a merchant in a country will also be available for other merchants and in other countries. I'm going to explain a little bit about that in a second. And finally, we're agile to the core. We are completely allergic to bureaucracies, excuses. We move fast. And by delivering and shipping fast and often, we make sure that we are up to expectations of our merchants on both speed and performance. Now let's see how our merchants sees us compared to the competition in all the aspects that are essential for the product. First of all, as Maria showed, we've been doing cross-border payments since day 1. Any merchant, any global merchants that wants to launch in multiple countries and in complicated [indiscernible], very fast. They're probably not going to have a local entity. It takes years of getting the licenses, getting the people, it's super complex. So they usually want to get beta brought either in USDs or euros. So we made that happen as opposed to most of the other competition. By offering the most relevant local payment methods in every country, we make it as easy to pay online as it is to buy the newspaper in the next-door kiosk. Global PSPs who are mostly focused on the U.S. and Europe, they leave the emerging markets as their last priority. That's the -- so they don't even have the fraction of the payment methods that we support. Our state-of-the-art API makes it as easy to launch in Nigeria or Bolivia as it may need to launch in Spain or Canada. It is up to the part of those -- of global PSPs, but with the added complexity of emerging markets. And finally, as I mentioned before, we are enterprise first. That means custom solutions. We need to build custom solutions. Every merchant comes with very different, very special requests and you're only going to get that deal if you listen to them and you do what they need. But how do we balance custom solutions with the speed that I was mentioning before, with a scale that is needed to work in 40 countries. That's a big question, right? And part of the reason to answer that is the way that we are organized as a company. The stack that Gabi showed before does not only reflect how we are organized as a team, but it's directly reflected on our technology stack as well. It all starts with integration layer with our merchants. Many of the merchants want to -- like to integrate to us via our API, but many others they want to us to integrate to theirs. That's what we call a reverse API or they ask for a custom build checkout because maybe today, they don't have the resources, the technical resources to do it or many other crazy things that they come up with. We have dedicated teams to make that happen. And this is a lot of work than most other PSPs are not willing to take. Then comes the product layer. This is where all the business logic of core products comes in from our pay-ins, payouts, local issuing, even our fraud prevention engine, our smart router, our transaction monitoring. This is where the brains of our products come in, but the key here is that all of these products are completely agnostic of the country of operation. Whatever -- whenever we design one of these products, we design it in a way that it's going to work everywhere in the countries that we have today and the ones that we're going to have tomorrow. Then comes the localization layer. This is where the real magic of DLocal kicks in. Every of these 40 markets that we work with today, they are extremely different from one another from regulatory compliance reasons, different taxes that apply, even some countries have different FX sources, they're all completely different from one another. So by splitting the localization layer from the product layer, we make it as easy -- to add new countries as easy as possible. And whenever we need to adapt a country because their regulation changed again, it won't affect the operation of the other countries. And finally, at the bottom, there's a local partner layer. Since 2016, we've integrated with over 400 local partners. That's a lot. Each of these partners, each of these integrations can take up months at a time to do so without counting the -- maybe the license that you might need to get to work with them. And we have 400 of those. Those 400 partners enable over 900 payment methods. As I mentioned before, this reflected on our teams, our technology. We have teams dedicated to launching new partners in Latin America. We have teams in Africa dedicated to launching payments methods in Africa, the same thing in Asia. But we don't make it as regional as sales. We have people in China who work with payment methods in Brazil. We have people in Chile who work with integrated payment methods in South Africa. This cross-regional knowledge is something that we really value because it's a way to expand your head, see what's possible. In some -- many cases, working in India gives us the experience to see what's going to happen in Uruguay or in Argentina. It's a way to see the future. Now why go into this local? Why even bother to go this local? Well there are many reasons to do so. First of all, merchants can maximize the reach, maximize their audience by using local acquiring and local payment methods. As Seba mentioned before, before DLocal if you wanted to process in any emerging markets, users would have to pay with an international credit card. That's probably less than 10% of the audience. Perhaps I was a little bit generous with the happy faces there. With DLocal, that's a completely different picture, using local acquirers, which are both -- they know the local issuers a lot better than international acquirers. They enable local solutions like installments, which international acquirers cannot, but also the local payment methods, being able to pay with cash, with bank transfers, with e-wallet, with mobile money. Every country is different and our recommendation always is just offer everything, give them all the options, let the user pick. That's the only way to maximize your target audience. But it doesn't stop here, having multiple partners per country also allows you to maximize conversion rates. Whenever a transaction comes through, a card transaction come through DLocal, our smart router, it's an AI engine that we built in-house will dynamically pick, which is the best converting processor for that transaction based on the dozens of different attributes. And it depends on the strategy of the merchant, we can optimize for conversion rate or to minimize delay or even to minimize costs. But if a transaction gets declined, we can try the smart chaining kicks in, so we can reroute the transaction to the second-best option and recover the transaction. Just to put an example with Didi Food in Mexico. Once we launched and we turned on the smart router, we got a 2.6 percentage point increase in conversion. That's a lot. And once we turned on the smart chaining, that number went out to 7 percentage point increase. That means that 7 out 100 additional people were able to order their food just fine, thanks to the DLocal. But it's obviously -- it doesn't stop here. In 2016, when we launched pay-ins and payouts, we've been evolving and expanding our products by working very closely to our merchants and listening to their feedback and listening to their requirements and the requirements of their customers as well. Nowadays, we made it as easy to work in Nigeria as it might be to do it in the U.K. By launching white-label payment solutions for both cards and alternative payment methods for multicurrency management, so you can aggregate the payments of 40 countries into one single solution. We then found synergies between our products. For example, doing refunds for alternative payment methods or not cards is extremely complete. But by leveraging on our payout infrastructure, now users in emerging markets can receive their money back. And refunds for alternative methods are not cards, it is extremely complex. But by leveraging on our payout infrastructure, now users in emerging markets can receive their money back after doing a payment with alternative payment methods. In 2021, we launched local issuing. And today, I want to tell you about 2 of our new products, which are the [dlocal Go platforms] and invoice collection. Dlocal Go for platforms is an end-to-end solution for marketplaces and other kinds of platforms to process payments in the emerging markets from one single place. Managing any of these platforms is complex enough or ready. So we try to make it as easy as possible, so they don't even have to worry about payments. But these kind of platforms come in all shapes and sizes. So we decided -- we designed our platform to be as flexible and dynamic as possible. Let me show you a few examples. You can think of an e-commerce marketplace in Mexico, for example. Imagine the experience, a user in Mexico selects a few products, some might be from a local Mexican sellers. Some might be from a cross-border one and they click on pay. With the dlocal Go, they have access to all the relevant payment methods in the country, and they can pay, let's say, they pick a car. They can pay in one transaction to their card. We would collect those funds. We would split those payments between the different sellers. So for the Mexican seller, we would settle in Mexican pesos to their accounts. For the international sellers, we can settle in U.S. dollars and then they can withdraw those funds in the currency of choice in their country of choice. We make it that simple. Or you can also think of a ride sharing up in Brazil. There's local regulations in Brazil [will] requires the acquirer or the sub-acquire in the case of the local to settle directly to the merchant, which in this case would be the driver. In this case, we would onboard thousands of sellers each week. We would run KYC to make sure that they are legitimate. And we would directly put the funds in an account credit by dlocal exclusive for those drivers. From there, the drivers can use the dlocal issue card to pay for groceries or they can choose to withdraw their funds to their own external bank accounts. Or you can also think about a social media app, let's say, a Chinese social media app that wants to launch in Nigeria. But this platform, they already have the ledger and the balance of each of their content creators or sellers. They don't want to rely on the dlocal to manage all those different balances themselves. That's fine too. We can centralize those balances. And at the moment of the payout, the platform can choose how much money to send either locally or cross-border to each of their partners. Now building these experiences, and these are just a few examples that are much, much more regards this suite of products, right? Each of these products could be accompanied by its own, but we can go through them one by one to real quick. So first of all, it's the onboarding and KYC. So we provide APIs to make the onboarding experience fill white label. So the user doesn't need to know that the dlocal is behind the scenes. And we run automated KYC process to make it very easy, fast and scalable to check if the user is legitimate unable to process on our platform. Then comes the accepting payments, which is obviously our bread and butter. But this time, with the added complexity of accepting payments for multiple sellers on a given in one single transaction. Then we provided tools to either split the payments when a transaction comes in or to move funds around between accounts. Fourth, we have the settlements. As I mentioned before, we can pay out to sellers either locally or abroad or even split funds for the platform itself, so we can pay out to them as well. And finally, we provide all the tools to manage these complex platforms in a centralized miner from centralized reporting, refinance [chargers] management, fraud support. This sounds like a lot, but it's actually the easy part. This belongs to the product layer that I was mentioning before. We are not the first to build this. We're not going to be the last. The key challenge to -- for this, for all of this is to make it available in 40 emerging markets. That's the localization there. That's how do we adapt this complex problem to the regulations, the complexity, the limitations, but at the same time, the opportunities that these markets have. Now let's talk about the other products I want to talk about today, which is invoice collection. Historically, at the dlocal, we've been helping global merchants reach their small customers. They're the individual customers, let's say. But now with invoice collection, we are helping them reach their largest paying customers as well. The teams that usually deal with this problem are the accounts receivable team that usually sit on a different table from the payments team that deal with the small customers. These accounts receivable team. They usually don't count with the technical resources that the payments teams do. So they require tools to make their life easier. And if it's in a centralized way, even better. And that's exactly what invoice collection does. There are flexible tools for multiple users. There's no coding required whatsoever. So as soon as the commercial deal is done, they can collect payments the next day. And just to put you an example, there are 2 ways to do it. The first one is why we call merchant-initiated payments. This way, the accounts receivable team can upload the invoices that they need to charge. They can upload all the regulatory and tax documentation that might be required for the country, and they can send a payment link to the customer. Or we have the other flavor, which is customer-initiated payments in which the customer already has a bunch of invoices that they need to pay for the merchant, and they can go themselves to the dlocal hosted checkout, upload the invoices uploaded the tax documentation and send the payment in any payment method that they want to the merchant. In that way, the accounts receivables team doesn't need to do anything. As I was mentioning before, we've handled all the taxes complexity. Every country is different. Every country might require different documentation or different tax logic. Users can pay using their local rails as opposed to sending an international wire transfer in dollars, which in some cases, that can be complex. And the best of all is that it's one solution for 40 markets at once. Now to summarize. Now with the dlocal Go platforms, we allow small and medium businesses that operate via global enterprise to collect funds in local currency. And with invoice collection, we allow the account receivable teams of these enterprise companies to collect money from the largest paying customers as well. So with the dlocal Go platforms and invoice collection, we're expanding our target market. On our mission to build the best payment infrastructure in emerging markets, we will continue to work very closely to our merchants and to build the products and services that will become the enablers for the experiences that they want to bring into the world. In the same way that a woman in Kenya can pay with [indiscernible] for bread, -- we want any Kenyan to be able to pay for online cars made in the U.S. or buy Chinese goods for their new business or even receive funds from their social media business in Kenyan shillings, -- and that for me sounds like a very cool future. Thank you very much. And now I'm going to hand it to John he is our Chief Revenue Officer, and he's going to tell you about how we work with our margins.

Great. Good morning, all. Okay. All right. I guess we've been talking for some time this morning. So maybe it's a bit more challenging. Okay. Guys, just a very brief introduction to myself. So as [indiscernible] said, John O'Brien, the Chief Revenue Officer for dLocal. I can't quite believe I'm saying this, but I've been in payments for over 15 years. I know I don't look at yet, I'm 38, been in payments for 15 years. All of that time has been in enterprise e-commerce payments. So last 5 years prior to joining dLocal. I was an executive on the management team for Worldpay's enterprise e-commerce business. So of the clients that [indiscernible] others referenced earlier today in the slides. I worked with all of those companies in developed markets and in some markets in Asia and Latin America as well. So really good understanding of the business. I first met our Global and [indiscernible] in 2019 when they were looking for, I think, the first outside funding to got to know the business really, really well then. I was really impressed with the team. And to be honest with was a bit frustrated why some of these customers were not working with us in some of those markets, given I already had volume with them in the U.S. and Europe and other markets as well. I know some of you, I think, from putting together the revenue synergies on the [Vantiv Roper deal], I cannot quite believe that's coming back again to put that combination together, but hopefully, we'll share some of the experience I've had here in the last year working with dLocal to change how we've structured the teams to enable the growth that Maria mentioned earlier. Okay. Okay. We seem to love this slide. I've seen a lot of this morning. So here's what we're going to cover guys. So I'm going to go over the go-to-market strategy for dLocal, which is obviously underpinned by our one dLocal concepts. I'll talk you through the sales funnel. It might sound like a really boring thing to talk about, but the sales funnel for us is incredibly important because there's an inherent feedback loop in that sales funnel, which drives our acquisition of new logos. And I'll touch on that briefly. I'll also talk about our approach to pricing and negotiation and I understand from or IR guys that's come up quite a bit, like how do we actually handle those negotiations with customers and how do we target the team, et cetera. We'll do a brief pipeline overview from both our existing and also our net new customers I'll talk a little bit about the team structure and how they're organized. And then finally, we'll hear from some customers. So I'll walk you through a couple of case studies, one from a global Internet satellite company, which I think [Sebastian] may have already given an in to earlier. And then also 1 from our partners at Spotify and then I'll play 2 testimonials -- or 1 testimonial, I believe, this morning, we had to, but I'll play 1 from our partners at Deel, who work with us across 3 regions and in 20 different markets. And then finally, I'll wrap up and hand over to Diego and hopefully get you guys out of here in time. Okay. So as Sebastian shared, clients throughout the heart of everything that we do. I mean, fundamental belief myself that B2B enterprise strategy is really not that complicated. As we talked about yesterday, the really, really difficult stuff is the execution side of things and that's been my experience in learning over the last 15 years, like we do not have to guess or be really clever, but the products the customers want us to build, like we just have to talk to them and listen to them. And that's a key thing that attracted me when I was looking for my next challenge to join the company and coming into the company to like that is the way that folks think on a day-to-day basis, like there is not a lot of ego around how we think about the products and the markets. All of those things are very closely tethered to a real-world outcome with a merchant on the back end. And as [Sebastian] rementioned, I mean, these guys are really proud to have those customers, and they drive our overarching underlying growth. Okay. So this is what do we call a plan on the page for our go-to-market strategy. So if I would summarize our go-to-market strategy, I would use -- I probably shouldn't put it on the slide, but I would use 3 Ps. So platform product and people. So the platform -- like it is not normal in emerging markets to have scalability and reliability, and that is what the platform brings. The product for us is hyperresponsive to client needs and as I said, that piece around really not being too clever and making sure we're closely tethered to the customers is a critical part of our go-to-market proposition and how we engage in and talk to customers. And then finally, our people. So the people obviously underpin the delivery of our service. We go for a true localization model there and meet the customers where they're at. So if I give you an example of [indiscernible] today, we're working them in on Africa. We work with them in Brazil and in Mexico. Their entire payments team is all in China, right? So we have to meet them where they're at. We have to have folks that speak Mandarin and offer that local service, but we also have to have experts who work in those markets to ensure we're delivering a best-in-class service for them as a customer too. So we wrapped those 3 Ps together. And that's really how we get into our lead generation. That's how we talk to new prospects and get them interested in the company. Once we have boarded those prospects, and boring of the prospects for us is all about long-term partnerships. So when we sign this customer, is this the customer is going to be with us for 10 years 15 years, 20 years. We want these customers to be longer term from our own experience in the enterprise space to it, it doesn't really behoove you to be signing up a lot of really, really small companies. You're much better off focusing on the [indiscernible] principal and signing up those top 20% to customers because without a shadow, without they deliver the 80% of the result that you're looking for. So land and expand is a key tenet of our commercial strategy, and we'll go into that in a bit more detail on some of the later slides there. The key thing about this strategy is once we've landed those customers, we use that feedback loop from the problems and pain points we've solved for those customers to drive our lead generation going forward. So if I know I've solved this specific pain point for Asian as a fast action retailer, it's highly probable that a pain point I've solved is applicable to like a fair fetch or [indiscernible] or somebody else, and we'll use that to be really targeted in our outreach to those companies and the key stakeholders at work there that make those decisions. Apologies if I speak really quickly. And I also have an accent that not from Latin America, as I think most of you have picked up on a far too much [indiscernible] this morning. The key part of this Slide, guys, that I've said it a few times now is just on the constructive feedback loop for us. So making sure we're tethered to that feedback loop from clients. [indiscernible] correlated to you in terms of the structure of the team would be how we think about account managers, like I think in a lot of software businesses, you think about account management is quite an operational role. For us, really account managers for us are like account executives. So we really, really target those guys on growing the absolute gross profit dollar amount. We get from those customers and being the custodians of the relationship internally and driving everything related to that client. So the targets for these guys are all based on cross-sell and upsell and not on the underlying organic growth of the customers. And we believe that's the right way to reward our people and to push them as well. From an operational standpoint, we have a follow the sun model for our customer success teams. So we've got 53 people in the customer success team today based in China, based in Africa, India and across Latin America. And those guys own the operational relationship with all of our customers to free up the account managers to do that upselling and cross-selling that I noted there earlier. So really, really important that we have that feedback loop and then we're learning from boarding those customers like in Expedia Travel, we will pick up on one of the specific pain points that they had. We can then use that for any [Traveline] or Airbnb or Booking.com, et cetera, and have a much more informed dialogue with them as it relates to our initial outreach and trying to board them as a client. This thing is not likely, I don't know. Okay. Okay. Lead generation. So Sebastian mentioned, I think, several orders this morning. We're very big on ownership internally. And for me, in-band lead generation is owned by the marketing team. I haven't had them for the last month or so. They've been completely outsourced to our Investor Relations team. So I'm looking forward to the inventing over, so we can get back to working with them. But the marketing on our inbound lead generation and the inbound lead generation is all bit events that we attend that are industry-specific or vertical specific. So if we know where we're going to win to travel, like focus, right, we know it's a huge event that travel, so we should be there to try and meet those customers, understand their pain points, talk about our solution, et cetera, driving specific marketing campaigns to generate awareness and leads. So this year, we've launched our first-ever newsletter. We call it the emerging perspective. I'm sure we can get folks signed up to that after the after the event as well, which details what's going on in the company and what kind of pain points we're solving for customers on a global basis and the marketing team own that inbound lead generation. The outbound lead generation is done by our sales and our sales development teams and is really, really specifically targeted on things like vertical effectiveness. So those verticals that Maria indicated to you that we work on earlier. I also want to make sure we replicate the process to go after those verticals because my experience, if I introduce a new vertical into the sales cycle, that causes a lot of friction with [indiscernible] and the team as well and slows down the overall path to revenue. So it's really, really important for us that we learn those lessons from the vertical that we're in with those customers and tendered that had active feedback loop to be really, really precise and targeted when we reach out to customers as well. And of course, we use all of the modern software tools that are out there around research like Apollo, I know this as well to see where do these customers have traffic? Do they have traffic on our markets, have they visited our website? Are they expressing interest in our type of solutions, et cetera, et cetera. Okay. So this, again, is just our sales process on the page. It's actually 8 stages in total, but we're collapse it here for you guys because I imagine all of you find it pretty boring. I didn't want to go through all of it. On the next slide, I'll go through the proposals and the commercial negotiations as well. But as I think about the sales funnel in total for us. I know some folks have questions about like what power the phones and should you optimize. I've been running sales teams for 15 years in enterprise. I've never seen a lot of benefit in optimizing between due diligence and integration. I see a lot of benefit in optimizing for the met to qualified leads that you have upfront. So that's what we focus on because if we do that, the natural conversion rate of the business will kick in. And for me, in a sales process, you want some natural tension because if you don't have natural tension, you get customer squeezing through it. You don't want to squeeze through, you get opportunities for clients that are not that relevant for your [indiscernible]. So I'll give you 1 example with a really large German company come to us last year. They're a public company. They wanted to work for 20-plus markets. So initially sounded like a really great fit for us. We put them through the process. As we got to the integration with them, they said actually we think the revenue you guys should get from us in each of these markets has been about 2 basis points. And when we looked at operationally what we thought that customer would represent for us and the load it would create on the organization. We turn that deal away. So it's really, really important to me and the team that we're discerning about those things because we have to be good teammates to our colleagues as well. And I want to make sure, in my roles we're putting resources to the clients that are going to generate revenue for the company. And I take that responsibility really, really seriously. And it's core tenet of the company, as Seb mentioned earlier, to understand that we're custodians of that cost that we manage as well, and we don't try and bring customers on just because it's a great name, but it may end up actually not being a great revenue deal for us and not representing the kind of upside that we want and looking like a really longer-term partnership for us. Okay. A little bit on just the proposal and negotiation phase. So you're probably sick of hearing this because you've heard it in all of our earnings calls. But we asked the team to prioritize absolute gross dollar -- gross profit dollars on each individual on each individual deal. There's no discussion I have with the team where I'm talking about the gross take rate on the net take rate, et cetera. Again, my own experience in payments is like it's not typically something that you can manage here as you look at the other public payment companies like [ADI] and others or Worldpay, it's not really something you're charging too much, given the large underlying costs you've got with interchange and scheme fees and things of that nature as well. So what we do ask the team to do, and it's really, really important for us is to be really clear on what is the pain point that we're solving for that customer because a deep understanding of that pain point allows us to develop a solution that articulates really, really clear value, and then we price that value in. So absolutely, we asked the team to price on value, and that comes from a deep understanding of the pain point that we're actually solving on behalf of the customer. And then finally, making sure the pricing for those things and conditions are really, really clear the agreements. I mean we went through when we had to do our full year order this year. I think as a [PWC], it's not just the balances, but all of the fees that we were charging for the customers as well. And with the nature of the book we have of customers like -- we have some people like an Amazon whose full-time job is to do contract compliance, right? So who's checking every border like the fees are how they meant to be, are the guys charging me the correct way, et cetera. So it's really, really important for us that those things are clear and transparent in our agreements with customers. And also, we apply learning from our sales process. So as I go through a sales process for onboarding customers, if we see a specific legal term with Gabby and the team that is continue to come up from a certain cohort to customers. We'll have a dialogue to say, should we just adjust this wholesale in our agreement because actually it's slowing down the pipeline and is creating some challenges with onboarding customers as well. So really, really important that we're clear and upfront on those things for customers. And all it's a simple strategy. We believe it to be really, really effective and drives the right incentives with the team. Okay. So next is just an overview on our pipeline. Just going to be a very quick summary of what I mean by the different headers here. So I'll talk, you'll see net new sales on the bottom, it's a pipeline for existing customers. So global multi-vertical companies are like Microsoft, Apples, Amazons, et cetera, that typically have a B2B and a B2C component to their business and are successful in multiple verticals globally. The second one here, regional and vertical champions. So you'll hear from 1 of our regional champions, I think, through lunch when we play a video from Alejandro Stein at Rappi and regional champions [across] the companies that have had success in 1 specific region in like -- in 5 or 6 countries. So Rappi, I think, is a great example of that. Latin America, Foodpanda is a great example of that in APAC, Carry1st or Jumia in Africa will be great examples of that as well. And then vertical champions are typically single-line businesses, so like think of it an Airbnb or Expedia. So they are the vertical leaders in that particular business or a Farfetch, SHEIN in fast fashion as well. And the vast majority of where we ask the team to spend their time is on those 2 types of customers. There's obviously very few of the global multi-vertical companies as you can see here, we're in the process of onboarding 3 new ones, and we've got 2 at very late stage who are integrating with us now as well at the moment. And then finally, we have growth companies. So growth companies or folks who made our minimal TPV threshold to work together. So we have a minimum TPV threshold of $6 million a year. And in a minimal market threshold of 2 to 3 markets because really if it's just 1 market. We're not really solving the level of complexity we need to for those specific companies. But these are companies we believe have the ability to become a regional or a vertical campaign or in some instances, to go out and become a global multi-vertical champion as well. So really, really important part of our sales process, and that's how we segment the clients internally and how we organize ourselves from an account management perspective as well. Yes, next guys is just on our land and expand. We said, for us, it's really important to start the relationships with customers in 1 market. What you'll see here on this page is a cross selection of various different clients that we have. When they made their initial purchase with the local, and as I flip through the slides, you'll see where that map is currently at today, and you'll see pretty significant growth as I think Maria outlined earlier. I quite like it because it looks like LEGO maybe you're not as simple as I am, but that's why I like it anyway. Okay. So here, you can see that all of these companies added a new country with the local plotted on the map here. So this is when the new countries added for us became significant because it became over $1 million in TPV per month. And I used to bear with me for the [indiscernible] colleges here on the next slide. So we've added here also a second product in existing country. In each example here that actually means payers. So that company was doing paints with us, then are doing [pays] as well. The slightly brighter green is to indicate when the second country in an existing market has gone over $1 million. And then finally, we've added -- I know with these colors there. I think it's a light pink and a kind of red, I don't know. But that's for invoicing that we've added more recently, which Federico touched on in his presentation. What we haven't added here is our marketplace solution, and we have had some of our top 20 customers take that solution from us really, really recently. So the next time we update this slide, we'll be able to reflect that with you as well, but I think you can clearly see that, that strategy we have is working to start the relationship with the customers, structure the teams with the account managers, they're targeted with upselling and cross-selling to those customers. And we've had I think if the guys will -- they've done, I think, a really phenomenal job of executing on that over the course of the last 6 years. Okay. I touched on this earlier, so I don't need to dwell on it. But again, the feedback loop and learning and listening to what's happening with customers is super, super important for us and also goes into our product development methodology, which is so well articulated by Fed earlier and it's really, really important for us that we have that relationship and work together in concert as a team to make sure we're listening to those feedback actively, not overcomplicating things ourselves are getting in our own way. And we believe the closer we stick to these customers. we see time and time again that they take us to places that we want to be. And we think that will continue to happen in the future as long as we stay well tethered to those clients. Okay. A little bit on how the team is structured. So we run the team regionally, so we'll have a head of each individual region. That person will then look after new sales. New sales is new logo acquisition. Sales engineers are folks who help customers with integrations and need configurations. Thankfully, for us, because of the scale of the platform, we only have 18 of those folks globally. We don't need to materially add to the team. And historically, those folks have gone into other roles in the company. So [indiscernible] here ran that team for us previously and now runs geo expansion. I believe we have [indiscernible], who's running 1 of our engineering teams who used to run that function as well. That's really important for us because it means people got frontline experience with clients. go off to work in more of an operational or back office role in the company. But again, they have that feedback and is really, really close to their chest about what the reality is like to sit in front of the customer, sell something to them will have an issue or a challenge with an integration as well. Our account management team, which we touched on is doing cross-sell and upsell and our customer success team, which is focused on living exceptional operational services to each of our customers. So we have 2 other functions, which we wanted to centralize for now. One was on revenue operations. So that team basically makes sure that -- all of the things that are happening globally and learnings that we have are shared across each of the different regions because it can be quite difficult to connect the team in China, with the team in Americas, with the team in EMEA, et cetera. And we want to make sure we're sharing and learning from the best practices that are happening in each of the regions, what things customers are saying to us, et cetera, and the revenue operations team helped us do that. We often will have things like fees. We have to pass to these customers as well, and that's all centralized through the [Revo] operations team and a really important feedback group with Diego and his team on our forecasting opportunity analysis, et cetera. So a huge part of the team, really, very important to make the whole structure run well, and we believe it's important to have that global for now, but we will regionalize it over time. And then finally, our marketing and sales development team. So marketing team, Gabby here from the marketing team. and our sales development team are kind of regionalized today, but our view is we're -- and I think this is a good thing. I don't think historically, we'd be great marketing. I think we're getting better. I don't know if I want to be a company that's great to marketing. I want to be a company that's really good for product and known for that. But this is something that we're -- you're starting to see us spend a little bit more on because our learning, I think, over the last months or so has been, as we make clients aware of the problems that we're solving, it's generating much greater interest. And obviously, marketing is a really, really easy way for us to do that and we want to keep those teams centrally for now because if you don't, that cost can also get out of control as well. And I think now we're in a position where we're very actively managing what's the ROI we're getting from each of these events. I laugh we go to Money20/20 and everyone spending to the ground on the booth and we've got the coffee stand, which doubles as a booth, but is 1/3 of the cost. But again, that's ingrained in the company. It's a kind of culture we have. It's important to be frugal and to be smart about how we're spending things and to really carefully track that ROI. And over time, we'll also look to regionalize those themes because as you've heard from folks here, hyper localization for us brings extra extraordinary benefits to us. It really, really does. Okay. So I think now the video will play from our partners at Deel. So maybe I'll just give a brief intro to Dan. So Dan is the COO of Deel, it's a payroll company. He'll talk more about it, super, super demanding client. They push us a lot. We work with them in 20 markets across APAC, LatAm and Africa as well and really, really pleased that Dan took the time to put this together for us. And we will let you hear from me. [Presentation]

Thank you, Dan, if you're listening. Okay. Just conscious of time, I think we're going to get Diego up here. So just 2 quick examples go over here, guys. So this is for a global leading internet service provider or satellite Internet service provider. Pain point for them was needing to become a utility in 11 emerging markets across APAC, LATAM and EMEA in an incredibly short space of time, so over a 3-month span primarily because they've received licenses to offer those services domestically in those markets. They had no staff or people in those markets as well. So really, really difficult for them to operate there. Before we interact with them, they were contemplating integrating into different processes across each of those markets. So obviously, the 11 different processes bring within issues with reconciliation contracts, relationships, et cetera. So main cause for that from their end was prior to this, they worked with an international acquirer. So a number of those payment instruments like [Verb] and others that were mentioned by the team here. We're not enabled for those folks. And having that goal wanted to become a utility in those particular markets. It's really, really difficult if you're trying to do it on a cross-border basis but an international acquirer. So you're really happy to say we're able to meet the deadline for a client, launch them in the 11 markets. They had a plan to do 15 with us this year. I think we'll now do over 20 markets would have been the next year. We launched Mozambique last week, and we launched Nigeria with them 2 days ago. So really, really excited to be partnered with those guys as a company. And I think as that product and business scales, it will be really, really phenomenal customer for us in the future as well and also drive 1 of the pillars that Maria mentioned earlier, which is Internet penetration in emerging markets also. Good Yes. And then final slide here on Spotify in Nigeria, just to explain the pain points we had. So Acceptance rates were dropping rapidly in Nigeria last March for Spotify. Obviously, the impact for them were like reduced sales in Nigeria and churning subscribers. Causes for that, I think Moses and the [indiscernible] touched on some of them earlier. So government restricted access to locally. I think as you guys know, the export oil in Nigeria, they import more or less everything else in the country, so dollar liquidity comes at a premium. And that resulted in net acceptance rate of about 20% for Spotify -- 20% for Spotify overnight from 50% or 60% prior. So we were able to turn on local processing for Spotify, but with Verb cards, but also with Naira locally, stop the churn of those subscribers, increase the conversion to back up to over 60%. And from what we've seen from the team and they've shared from their own data, we actually helped increase sales in that market for Spotify's customer results. So really, really happy to be able to do that. [indiscernible] and I had a lived experience of this where we were in LEGOs last September, where Uber's General Manager thanked us for enabling this because he could pay for Spotify in Naira himself as well. So really rewarding for myself and for the team to see the labors of more work as well when we travel to the different countries that we operate in. Okay. And then, guys, I think we've covered this a number of times, and I mentioned kind of the 3 Ps, which are critical thing really for how we work. So it's the platform and reliability. And the fact we're able to do that at scale are people providing a true localization on the service and really, really being modest and humble as it comes to how we think about our product. And I think that's really underpinned by the fact that, as in [indiscernible] mentioned earlier, or maybe [Haco], over 40% of the people in the company are software engineers. So we're really able to deliver quickly for people on those type of solutions. Because of the nature of the kind of folks we have who are engineers, they think through things in a really systematic fashion. So we don't tend to run into some of the challenges that payment companies had. And as we continue to scale the company into these different markets, for me, that mold just continues to build because it's really, really difficult to replicate these things and really, really difficult to run a business like that truly locally. Okay. I've taken up far too much time. I think I'm going to hand over to Diego. Thank you very much for your time. I'll be around all day and hopefully catch up with some of you in person.

Thanks, John, and hello, everyone. Very happy to have you here. Diego Canay, CFO of the dLocal. You have heard today from us how we created this one dLocal model. You heard it from Seb, you heard it from Fred. And how that allow us to solve payments, complex payments in emerging markets from our merchants. You heard from John and Maria, how that generates a lot of stickiness and engagement and it allow us to grow with our merchants. Now we're going to see how that together with our DNA and culture, generates a very powerful financial model. Our financial model has 3 pillars: growth, profitability and cash flow generation. When we talk about growth, we focus on all the all the numbers, starting with TPV, but we particularly focus on gross profit dollars. We have all our internal incentives aligned to maximize gross profit dollar growth. And when we talk about growing gross profit, we talk about bringing new merchants on board but particularly as we saw today, growing with our merchants. That implies having basically 0 churn growing organically with them and bring them to new countries, payment methods and products. That resulted in the last 2 years to have a 83% CAGR on our gross profit growth. The second pillar is profitability. We have boosted this company from the beginning with a very lean culture. We are 700 people managing more than $10 billion in TPV. And we have a very cost discipline approach. We fly coach. We don't have fancy [indiscernible]. But particularly, we are negotiating every expense that we make as it was our own. And we hire people and spend resources in emerging markets, finding the best talent, but at more convenient costs. And that results in a totally best-in-class profitability that we measure as adjusted EBITDA over gross profit of 76% in the last 2 years. The last pillar is a strong cash flow generation. We measure the cash acceleration by the conversion from net income to free cash flow, and that has been about 100% or above 100% in the last 2 years. How do we achieve that? Well, first, we're having as many other payment companies, negative working capital. That in place that the more we grow, the more cash we generate. But particularly, we don't have to spend our own money in growing. Second pillar to that has been laser-focused with capital expenditure. Our capital expenditures are fully focused on software development, technology and automation. And that basically represents 5% of our gross profit. And finally, we have a very efficient structure will also allow us to have a strong cash flow generation. When you combine these metrics, particularly growth and profitability, you get to a rule of 40 in our case. You know the rule of 40 is very good. 80 is great. In our case, has been 159% in the last 2 years. So now let me talk a little bit more in each of these pillars. So growth. I think the slide speaks for itself. TPV and revenue have basically doubled in the last 2 years, and gross profit grew 83%. This is not by chance. You heard from us today, we have grown our countries from 19 to 40. We have grown our premium methods from 300 to more than 800, and we have grown our merchant base from 190 to 650 in the last 2 years. And the result of these are clearly here. When we talk about profitability, we look at adjusted EBITDA growth, which very in line with what we just saw has grew 91% in the last 2 years, and particularly adjusted EBITDA over gross profit. If you look at all the periods, you see that it has been on or above 70%, particularly the last 2 years, reaching 76%. But it's not because we haven't invested. We invest a lot. You see both in OpEx and in head count that we have significantly invested over the last 2 years, particularly focused in technology and sales and marketing, but also in G&A as we became a public company and reinforce our processes and controls. But we have a lot of operational leverage. What does that mean? Even though we invested a lot, gross profit grew even more. And you can see that by the metrics on the top. When you know OpEx over gross profit, it was 44% 2 years ago, now it's 3 -- 33% of the gross profit. And the same applies to headcount. If we do the gross profit over headcount, we were generating 184,000 2 years ago, and then we're generating 278,000 in 2022. So the last pillar is cash generation. We measure this, as we mentioned, as free cash flow in absolute basis and also other net income. For this particular graph, we are considered the cash in [Estero] that you are aware that we put in 2022 as part of our free cash flow because we consider that to be temporary. Actually, in Q1, you see that we already collected $40 million, and the rest is expected to be collected this year. So when you look at the CAGR of our free cash flow has been 76% in the last 2 years. And particularly, we were close or on 100% of cash conversion. So with all these metrics that you just saw, it's not a surprise that we compare very well against our peers. Companies in general that we admire and great companies. We look at the last 2 years of gross profit in the last 2 years of margins. As 2 years ago, we did the IPO. So it's a good track from there to now. If you take net revenue, or what we call gross profit, we are clearly first and way above the average. If you consider EBITDA growth, we came in second after a peer that comes from a much lower EBITDA margin base. And when you consider profitability measured by EBITDA, our net revenues or gross profit, we also come in first. Another way to see this is with the rule of 40, again, that combines profitability and growth. And you see it here. I mean, these are all great companies. We stand out clearly first in a 159 ratio for the last 2 years. With this and considering the areas we have today, I would like to touch base on a couple of topics that come up very frequently in Q&A and in meetings with you guys. One is net take rates and the other is capital allocation. When we talk about take rates, the first thing to understand is that there are factors that we control more or less like pricing or to some extent, cost efficiencies and some factors that we don't control, and we don't solve for, which is basically mixes, mixes of product, mixes of services, measures of countries and mixes of merchants. When we talk about product mix, we talk about paying and payouts. All things equal, payouts have a lower take rate. And why is that? They have a very short settlement period, and they are settled through bank transfers, which is a very efficient payment method. So as you see in the last year or so, the share of payout has increased and that affected the take rate -- net take rate down. The second mix is what we call service, local to local or cross-border. And again, all things the same, local to local have lower take rate than cross-border because it doesn't have the FX servicing implied in it. So and as you see there, sequentially in the past year or so, we have increased our local to local share to almost 50%, and that had an impact on take rates. And the lows in country mix. We operate in 40 countries. All those countries are different. When the country is more complex, and we have a more mature solution, we typically have higher take rates than in a country that is more less complex and we are just starting. So then you have countries like Brazil or Chile which are quite on average of our net take rate. You may have countries like Mexico, which are lower in take rate with a very efficient market. And you have countries like Argentina, Nigeria, which are above the other [subset rate]. If you look at last year, you see that we sequentially increased our share, particularly in Mexico, which is a country with lower take rate, we decreased our share in Argentina, and that basically resulted in a increase in the net take rates. Another way to see this is with a bridge. So if we do a bridge from 2021 to 2022 and then to Q1 2023, we basically see the impact of each of these effects. In last year, we have a higher share of payouts of 5 percentage points, a higher share of local to local of 10 percentage points and an increase of share in Mexico and a decrease in share in Argentina. Those 3 combined resulted in that decrease in net take rate. And on the other hand, we have efficiencies in different markets that offset that by [ 0.1% ]. In the last quarter, we didn't have a change in net take rate. But when you look at each of the specific drivers, it was quite the opposite. We have more share of cross-border. We had a partial recovery of Argentina and growth in Nigeria, and that contributed to the higher take rate and we had some temporary inefficiency that we expect to regard going forward. So if there are 2 takes away to this is, first, the main driver of trade increase or decrease is the mix. the mix of products, the mix of services and the mix of countries. And the other 1 is, for us, the grade is an output. And sorry, and it's not pricing pressure, it's mixes. And the second and most important is this for us is an output. We will always try to maximize our gross profit dollars. If I merges choose to work with us with payouts with lower take rate and pain, that is great. And if they want to launch a county that has a lower grade than the average, it's great as long as we will always start to maximize the gross profit dollars. With this, let's move to capital allocation, which is a topic that has risen more interest from you guys. So when we talk about capital allocation, we have basically 3 strategies. The first 1 and most important is organic growth. That has been the better and better for us since we started. As you know, we will start the company from the beginning. And we invest in technology. We invest in sales and marketing, we invested in expansion and customer acquisition. But even after we invest significantly on that, as you saw, we generate a lot of cash. So that's why the other 2 strategies become more relevant. And we see them as complementary and hopefully, they finally compete with each other. In terms of strategic decisions, we have 2 factors there. They need to be strategic. They need to bring commercial distribution or allow us to expand faster to Asia and Africa, and they have to be consistent with our culture and they have to be opportunistic. What do I mean by that? Obviously, in times where our share price is higher and [indiscernible] are higher, we have a better trading currency that when our share price is lower. And the opposite appears for buybacks when we believe that our price is low, the local is the company we know the most. So it competes against any other potential acquisition. And that's the time when it makes sense for us to buy our own shares, to bring the most long-term value to our shareholders. And that's what we did. So we launched our face buy-back program back late in December. It was a $100 million program. This is expected to finish in July. We will probably achieve the $100 million or very close to that. And if we show you the public information, which is what we show in the last issued financial statements. At that point in time in mid-May, we had already bought [ 4.4 million ]in shares for $67 million at an average price of $5. That represents already 3.4% of our float. And we did that while continuing to increase our cash flow. So even after buying that, that represented only 87% of our free cash flow of Q1. Again, we will continue to analyze these alternatives. We have a strong cash generation, and we will evaluate whether to use our cash, particularly for M&As of our share buybacks as the context tell us that will be the best value for our shareholders. And this slide just shows part of that analysis. It's just a comparison of price to earnings and net income growth, and you see how or why we believe it's a good moment for us to buy our own shares. So the last topic is something that you guys have been asked for and is showing you for the first time on our medium-term objectives. Also an update on the guidance. The guidance we gave for the annual still remains the same. We have more thorough reviews every quarter. So once we publish our next quarter in teen, we had a more for review. But the guidance age was 620 to [ 640 ] gross revenue dollars and [ $200 million to $220 million adjusted ] EBITDA dollars is consistent with the current forecast. Medium term, when we talk about in time, we think of 3 to 5 years, and we have objectives that we're sharing for you for each of the pillars of our business model. For growth, we expect to continue having basically see churn. Whenever we measure churn every quarter, every year, it's always below 1%, growing at this pace implies not losing a single merchant. We will continue to benefit from the organic growth from them, 15% to 20% we saw before with Maria in emerging markets. And on top of that, we will continue to add come to these payment methods and products. We expect that to result in a gross profit CAGR for the medium term from 25% to 35%. Profitability. The ratio we use is adjusted EBITDA over gross profit. And the same that we have done, we will continue to have a very disciplined cost culture, a very lean organization. And we continue to hire [indiscernible] and spend in emerging markets where costs are more convenient and there's a lot of talent. With that, we expect to have a gross profit -- an EBITDA of gross profit ratio of 75% or more in the medium term. And finally, cash flow generation. For cash operation, the metric we use is basically CapEx, which is 1 of the main drivers from EBITDA to cash flow. And we continue to be laser focused. Our CapEx will be software development, technology, automation. It has been consistently close to 5% of our gross profit, and we expect that metric to continue that way. We don't expect to spend more than 5% of our gross profit in CapEx. What is more interesting for you again, when you combine the metrics, if you combine growth and profitability that will bring us a rule of 40 as a target for us of 100% or more. And we like a lot of that metric because it gives us the flexibility to focus more on profitability or on growth. But at the end of the day, we will have to maximize the combination of both. So with that, I will pass the floor back to Sebastian and Sergio for the closing remarks.

Yes. Okay. Thank you very much for bearing with us for this last few hours. As we said before, we were here in NASDAQ 2 years ago. Tomorrow, we'll be ringing the bell once again. We are extremely proud of what we have achieved over the last 2 years, and we are amazingly optimistic about the future that's coming up. And as I'd like to say, we like to put our money where our mouth is. We are none yesterday that the shareholders about $160 million worth of shares over the last few months. That was $100 million that General Atlantic bought and an additional almost $60 million that shareholders, Andres [indiscernible], Eduard and myself bought out of our own pocket. So I think that shows the commitment that we have to the business. Again, we are very proud. There's a lot of work to be done. We are only scratching the surface, as I mentioned before, 40 million -- just 40 million people paid to us during the last month, just 3.5 million people have been -- were paid through us for the services that they provided. We expect both numbers to grow very significantly ahead. And we are super proud of what we've done. We are super proud of the team that we have. It's a diverse team Initially, it was mostly Uruguay and then Latin America. More and more, we are hiring people in Africa, in Asia, and we are very proud of our urban origins. We are very proud of being Latin America and most of all, we are very proud of bringing and showing the vibrancy and the potential of the emerging markets that are still underserved and that represent a major source of growth going ahead.

Thank you, Sergio. Just to complement on that. I hope you felt the passion that we have for this business. I feel it when I hear our team. This is the work of our lifetime. And I want to sit on this point. If you believe in emerging markets and if you live in global companies, there's no better way to index yourself to that growth. We could not be more bullish about our opportunities. I want to thank you for the support, and I want to thank the team, obviously, for putting this together. It was a lot of work. Thanks for the support. Thanks for the questions. You make us better. This is an iterative process, and we are very open about the fact that we are learning -- that's the thing I like the most about my job. We need to keep learning. So keep challenging us. Merchants will keep challenging us and we'll hope to continue to be able to deliver. We have a break now, 10 minutes break. We'll go to Q&A. Thank you, everyone.