Joubin Rahimi
Grandios! But now in English. My name is Joubin Rahimi and we are back to the insights on the VTEX booth. Next to me is Mariano. Mariano is the co-founder of VTEX, one of the largest e-commerce companies of the world. Perhaps you heard of it, perhaps not, but now today we have got VTEX and Mariano here and I'm very pleased to have you on the table. Hi, Mariano.
Mariano Gomide de Faria
Thank you, thank you for having me. And if people don't hear about VTEX, certainly they heard about our clients, right?
Joubin Rahimi
Yeah, for sure.
Mariano Gomide de Faria
Yeah, Auchan, Carrefour, Electrolux, KitchenAid, Whirlpool, Manchester City. So many, many companies in the world are powered by VTEX, and we are probably the backbone for their connected commerce.
Joubin Rahimi
And what I really find impressive is your yearly conference, which is nearly as big as the OMR.
Mariano Gomide de Faria
It is indeed. VTEX Day. Yeah, yeah. Just happened in São Paulo 15 days ago. And this year we reached 50,000 people.
Joubin Rahimi
50,000?
Mariano Gomide de Faria
Sold out. I believe we would have like an audience for 65, 70, but there was no more space. So we sold out 9 days before the event. And it was great. 280 speakers, 240 sponsors, and people coming from 22 countries. And the Latin American engineering for commerce is pretty great, kind of big. And it's interesting, many, many companies in the world are coming to Latin America to find in our engineering the source for their growth. So it was an interesting event this year.
Joubin Rahimi
So you have got on the shirts Brazilian engineering on the back, right?
Mariano Gomide de Faria
We do Brazilian engineering. Brazil, it's a— Brazil and Latin America, it's one of the top engineering sources of talents in the world. We can quote like China, India, Russia, Eastern Europe, and Latin America. Of course, you prime those engineers in England, in US, But the source, it is coming from those regions. But because of the geopolitics, the other 4 regions that I mentioned, they are compromised. So the world just discovered that Brazilian engineering is trustful, creative, and highly efficient. So we are seeing more and more companies, and including like Meta, Anthropic, AWS, like, uh, Google.
Joubin Rahimi
Yeah, they're coming down to Latin America, right?
Mariano Gomide de Faria
Coming down and hiring by thousands, because it's a pretty kind of a trustful, land to establish engineering team. So yes, we are proud here in Germany, in Hamburg, with this Brazilian engineering tag.
Joubin Rahimi
And I really remember last year when I went back from the last party I joined, you were sitting in the foyer. We were in the same hotel. And then we talked 2 or 3 hours about these differences, and that was really impressive. So if you get somehow the chance to talk with people from other continents, do it. It doesn't matter what time it is.
Mariano Gomide de Faria
Yeah, this is true, right? The ultimate form of blindness, it is if you believe in your own vision.
Joubin Rahimi
Totally.
Mariano Gomide de Faria
And I believe the world is way more globalized than people imagine. So the best cases from Romania, the best cases from US, from Mexico, from Brazil, you do have edge cases of a lot of competencies and areas. So if you can join that and explore the best, you will increase your profitability, you increase your chances of growing revenue. And so that's what I really believe in, global kind of global events. OMR is slowly becoming a global event, so more and more people are discovering.
Joubin Rahimi
Web Summit is much more global, right?
Mariano Gomide de Faria
Yes, yes, yeah. So I believe Germany has many things to teach to the world. OMR, like, started as a marketing event, but now is an entertainment, technology, marketing all together. So I believe that more people from all over the world should come to OMR, and I believe OMR should also organize delegations for this.
Joubin Rahimi
That's a very good idea.
Mariano Gomide de Faria
Dozens of thousands of people here in OMR. OMR should organize delegations to go to LATAM, to go to the US, and increase this global reach of the German market. So yeah, I believe in the globalization. Although the world is a little bit in a hiccup.
Joubin Rahimi
Yeah, but okay.
Mariano Gomide de Faria
But we already saw that in the past.
Joubin Rahimi
We shouldn't stop by doing that.
Mariano Gomide de Faria
No, we shouldn't. Yeah, that's a fact.
Joubin Rahimi
So Philipp, if you hear that, delegations into the countries is a very good idea.
Mariano Gomide de Faria
Yeah, that's a great idea. Please organize a delegation to VTEX Day. We're going to welcome you in Latam and you're going to know the best of Latin American engineering.
Joubin Rahimi
And yeah, perhaps we can grab the engineering part because engineering and AI is really changing the world. So this is what we in Germany and Europe think. Of course we think about sovereignty and data protection. How is it in Latin America? And so how are you looking on the topic AI and how it's changing your life?
Mariano Gomide de Faria
AI, it's to the world as internet was to the world in 2000, right? the top 10 companies in the world in the 2000s was oil companies. Yeah. And after 10 years, they were not even listed in the top 10. The top 10 companies in the world right now may not be listed in 10 years' time. So for any company in the world, in any category, If you want to guarantee that you will be one of the companies there, you need to embrace a hard move. You need to embrace AI in every single process of your company. And that means you need to transform your company from inside out. AI, it is a CEO game.
Joubin Rahimi
Totally.
Mariano Gomide de Faria
It's a top-down thing. Don't expect 2,000 people to just absorb the best of AI. AI should be mandated, and the adoption curve will define what are the companies that will survive or not.
Joubin Rahimi
So the adoption curve of the whole company, of some people, or of all employees, what do you think?
Mariano Gomide de Faria
I believe it is on the process level of the company, not only in the employees level. Is in the org chart. It is in the way you manage. It is in the way you sell. It's in the way you deploy. It's in the way you set the bar from your team with AI. Like, I do have a kind of a quote internally that said, before AI, a good kind of timeline would be 30 days for decision. With AI, the timeline is just 24 hours. And that can be explored at the most. We are transforming VTEX inside, but also we are transforming the product for our customers.
Joubin Rahimi
Yeah, we saw that.
Mariano Gomide de Faria
Everything. So we just launched the VTEX AI workspace where our customers can build agents and can use agents built from SaaS that are ready to run activities for them. So you stop hiring services by using services on a, on a SaaS basis. This is one of the launches. We are launching also a CMS that you manage by AI on a prompt base, so that will transform the way you build your storefronts. So recommendations, personalization, hyper-personalization, everything, it's a It's AI native right now. So I believe that will generate great results for our customers in the world of AI where LLMs are diluting the power of traffic layer. So what I mean is like Google and Meta used to be like the duopoly on the traffic.
Joubin Rahimi
But now it's changing.
Mariano Gomide de Faria
Now it's changing. So now you have Anthropic, you have like all the other companies, OpenAI, Anthropic becoming like land of traffic and they will dilute the power of Meta and Google. And with that, the retailers and brands will win. So now to be agnostic to channel, to have every single channel available in B2B and B2C in a very simple way. It is a must.
Joubin Rahimi
Yeah.
Mariano Gomide de Faria
Until AI era, you can't, you could choose your channels. Now you can't because you don't define how your customers, B2B or B2C, how they're gonna access your company. So is or you are in all channels or you are out of market. And VTEX, uh, I believe is well positioning because we serve B2C and B2B with an OMS. All together.
Joubin Rahimi
And you've got the Marketplace additional, right?
Mariano Gomide de Faria
And we do have Marketplace integrations out, and we are Marketplace Suite as well. So you can run every type of commerce in one single platform without an overhead of midwares, layers, multiple stacks. So we are migrating a lot of companies coming to VTEX because they are fed up with the running 30 softwares, 25 softwares, or 10 softwares plus 20 apps. They just don't want these anymore. And because of security and privacy, they just want something that is simple, works, and do the job that the customers are expecting.
Joubin Rahimi
So the funny thing is, so the MACH Alliance, which you joined quite early, right? But you quit there. MACH Alliance was really hip for a while. But if I'm now looking on MACH Alliance, it has also really a downside, because if you're thinking about AI, you have to connect all the data silos with perhaps not the same data, and it's getting a mess to work on it.
Mariano Gomide de Faria
Yeah, you know, when you have unlimited freedom, you have a chaotic environment. Yeah, anytime you allow unlimited freedom You will end up with unlimited chaos. That happened before in the on-premise. Happened like pretty in the last like 3, 4 years with the headless approach. Now it's happening again with AI. So the MACH Alliance was a great concept, but with a great concept that provides unlimited freedom to compose the stack became something very heavy to maintain. So we were a proud sponsor and member of Mach Alliance, but we left, as you know. The reason we left is that we didn't see anymore this complexity paying off for our customers.
Joubin Rahimi
And the value out of the complexity, right?
Mariano Gomide de Faria
Yes. So we switched gears and now we believe that simplicity, one stack that serves all the channels, that serves all languages, that have multiple payments and that runs OMS, that's how you're gonna deliver the bottom line. At the end of the day, it is a game of profitability. So if you do not reach 10 to 20% profitability as a retailer or a brand, you are out of the market.
Joubin Rahimi
And it's pretty fast.
Mariano Gomide de Faria
It's pretty fast. So the companies that learn on how to operate with less people doing 2x sales, they will be out of market. So the idea is Vitex needs to guide our customers and deliver to them the framework on how to do it. The clients, they want to be guided. And we are, in our statement, to be the backbone for connected commerce, has always been with the same vision since 9 years ago. We defined that the backbone for connected commerce, it means that you will test multiple channels, you will test multiple languages, you will test multiple payments and multiple sources in a very simple way, all connected to a very kind of a strong hardcore spine, that's VTEX. So I believe the world now is coming to where VTEX is positioning. And that's why VTEX, it's really well in capturing the new demands as Manchester City. Yeah. When they realize that they want to unify all the experiences, the tour experience, the parking, the catering, the hotels, the ticketing. Like every— the merchandising, the retail, everything in one platform. They just saw VTEX as the, the main competitor for that, and that's why they choose us.
Joubin Rahimi
And do they already feel the advantage having only one system?
Mariano Gomide de Faria
I have two of the experiences they call Phase 1. Yeah, it's already live, and they are able to provide in one experience the retail experience and the tour experience. And now they're gonna aggregate other experiences to the same kind of a checkout. So it's gonna be interesting because, if you are a fan of any sport clubs in the world, you are fed up, you are tired of having like the loyalty program URL, totally the merchandising URL, and like every single thing. You have one, one platform and one checkout. At the end of the day, you are just one consumer, one fan to one club. You're right. Should be one software running all these. So including B2B, all Manchester City B2B also, we're going to go through VTEX. So at the end of the day, the world where every single department inside the brand or retail has its own software, I believe this age is already gone. That was the prime of MACH. Yeah, like every single area you have your own software, but you end up paying too much.
Joubin Rahimi
Too much. We pitched here at HSV, so the local soccer club here. It is 12 years ago, so quite a long time ago, and we had the ticketing, we had the shop and other stuff. They tried to find it somehow HSV-ID. Untill today they have it not done. Oh, the funny thing is, so we were much too expensive, so we made this, uh, we got the RFP, we took it serious, and the cheapest guy won. All right, so they never mentioned it. But the funny thing is they looked at Bayern München and the numbers merchandising are really going up and Guess what? I think there's a correlation too.
Mariano Gomide de Faria
At the end of the day, the world is going for what I call the concierge economy. The concierge economy, it is for every brand and retailer on earth to sell time to their consumers. If they facilitate, if they streamline, if they simplify the journey, the customers just want what they need. Yeah. And as less clicks, they have in between what they need and to the delivery, that, that's what they want. So sometimes we overcomplicate it just because we believe the customers would like to, but no, no, this is like, be simple.
Joubin Rahimi
It is inside out normally.
Mariano Gomide de Faria
Yes.
Joubin Rahimi
Yeah, you think, oh, we need to do that because out of the finance department, right? Yeah. You said regarding AI, a lot of is changing and you build some things, you build the AI Workspace. Perhaps you can mention 2-3 things because you build a great thing there and it's so important that the people see what is possible already now.
Mariano Gomide de Faria
The AI Workspace, it is an opinionated AI builder where you can create your agents. Yeah. You already have some agents created by VTEX. You have the agents created by the ecosystem of VTEX, and you can create your own agents and can work to co-pilot your team. So it can work for get your SEO better, get your connections with UCP better, get your connections with any marketplace, or get your catalog improved. Or find you a new source on seller, or find you a new channel or marketplace, or whatever it's necessary for you to amplify the channels. The AI workspace, it is the biggest launch VTEX has in the last 10 years, and I believe it is future-proof to our customers.
Joubin Rahimi
Totally.
Mariano Gomide de Faria
Really wants to access AI to be in a secure and a private, secure environment. The problem with AI is that it is too much freedom. So every single corporate in the world now is facing the paradox of should I give my team unlimited freedom on AI? Should I regulate how they use AI? At the end of the day, you need to be in the middle. So you need to allow them to create, but you need an environment that's secure what they can do. And that, that's VTEX AI Workspace.
Joubin Rahimi
So it, it reminds me a bit of Domino and Lotus Notes. Domino in the best years, not now, because what do they have? They had a system, a structure, everything was in one place and you could make a lot of things. That's why it's still living in some companies. So I want to take the positive things out.
Mariano Gomide de Faria
I remember it was really great. And these ecosystem games, right, will be unlocked by AI. So it's going to be a Romanian company creating something that will get your catalog better, and you just accept the tasks that they are proposing to you, and you don't need to hire anything. That's going to be inside VTEX. I foresee a hundred $200 million operation to be run by 6 to 10 people. That's where I believe the AI workspace will land. It's going to create superhumans that will be managing bigger, really large operations with a very, very, very lean team. And that means at the end profitability, right? So the one, the first companies that goes to that path, they're gonna discover this operational framework that allow them to buy others and expand inorganically. So I believe in the next 4 years, we're gonna go in a high efficiency mode. The world, we're gonna find more profitability, but then in 4 years time, the interest rate will come down a little bit. And then the M&A will be booming.
Joubin Rahimi
Yeah.
Mariano Gomide de Faria
And then when that happens, who is going to win is going to be the ones that can leverage the profitability and apply the framework, the AI framework, and scale up. And scale up. So consolidation, we are 3, 4 years ahead of a big consolidation.
Joubin Rahimi
So you should remember this one. That's pretty important. And what I Also, when I come back to the AI workplace, we do have got something called— we call it brytes. And brytes is something where you can see the digital body language. So if you click fast or scrolling fast or slow, you can recognize if the people want to buy or they are searching for something or they're comparing. And based on your platform and the workspace, you can send the information to all the other systems and they can use it.
Mariano Gomide de Faria
Yeah.
Joubin Rahimi
And so this is so powerful because we made it and that was okay. But that's a superpower for everyone.
Mariano Gomide de Faria
That's really superpower. And that might act as an agent, you know, like you can clusterize customers in their kind of expectations or boxes to allow the marketing team to work better. And that's going to be an agent. Yeah.
Joubin Rahimi
And that's pretty great. So I think the time is over. The people are already looking here. Thank you, Mariano.
Mariano Gomide de Faria
Thank you so much.
Joubin Rahimi
I hope you will meet us again.
Mariano Gomide de Faria
Yeah. Yes.
Joubin Rahimi
Thank you.
Mariano Gomide de Faria
Thank you. Always a pleasure.
Joubin Rahimi
Yeah, pretty great pleasure.
Mariano Gomide de Faria
And one day I'm going to do this speaking in German. Yeah.
Joubin Rahimi
Okay.
Mariano Gomide de Faria
One day.
Joubin Rahimi
In São Paulo or Brazil. I will visit you.
Mariano Gomide de Faria
Visit, come.
Joubin Rahimi
So if you're learning German, I will speak Portuguese. It's okay. Thank you, Mariano. Thank you.
