A conversation with Zigor Nuere, Founding Partner of Tantum. July 2021
Zigor Nuere is a founding partner of Tantum, a company specialized in the Chinese market and, more specifically, in its payments and ‘superapps’ ecosystem. The company offers consulting services, but also has its own payment platform to integrate Alipay and WeChat Pay in Spanish businesses. “We do various things. When we present the company there (China) with that range of services, they are not surprised. But here in Spain they don’t get it. What do you do, payments or marketing?” Nuere laughs. “Well look, both.”
Tantum won the “El despertador de pymes y autónomos” challenge, launched by the Ecofin Forum and the Madrid City Council. In this interview, Nuere tells us his history and delves into the peculiarities of the Chinese market, its advanced level of digitization and discusses how Madrid can promote itself better in that market.
M.I.A.: What is Tantum? How was it created and when did you open the Madrid office?
Zigor Nuere: The idea to create Tantum came from three partners who have lived in China for many years. I am the one who has lived there the least time and I have spent ten years studying at the Beijing University of Language and Culture. There everything is about who you know; being such a large population the issue of trust is key. WeChat, the social network, was looking for strategic partners in Europe to implement their payment platform, WeChat Pay. The opportunity arose through a direct contact: we had a meeting together with Bankinter’s former director of innovation and we set up the company in Madrid in March 2018. Initially it was for the implementation of WeChat Pay in Spain and other European countries.
In the past seven years, the speed of digitization in China has been astonishing. When I arrived in 2005, there were no smartphones and since then the transformation has been brutal. Its industrialization began in the 80s and grew a lot from the year 2000. Shortly before WeChat, the Alibaba group was born. The technological boom began.
WeChat works in all countries where it is not restricted. In India it is blocked and in the United States there was a time that, due to political issues, it was too. But in most of the world it works. The app was born as a messaging service just like WhatsApp and now it is an entire ecosystem: you can pay workers’ salaries, electricity bills, your mortgage, order a coffee, pick it up… Anything you can think of; you can practically live inside it, it is what we call a ‘super app’. For example: I go to a café in Madrid. You scan a QR code, pay from the app and they send you a discount coupon for five friends to come and invite them to a drink. That is a brutal viralization campaign. And that’s what we do at Tantum. We help SMEs and companies to create that sales flow. We are not exactly a consultancy. It is true that we provide consulting services for companies that want to develop their business in China, or give them visibility. But what we mainly do is provide these services, not the consulting itself.
M.I.A.: Besides Tantum, you have Starpay. What is it and how is it integrated into the ‘superapps’?
Z.N.: It is a payment service provider. We are an agnostic payment gateway that connects other platforms, other e-commerce platforms and other banks. Imagine a Chinese customer who goes to a coffee shop in Madrid and scans a QR with his Alipay or WeChat Pay wallet. Starpay registers that payment, sends a notification to Alipay or Wechat telling it that one of its customers wants to pay on one of our customer platforms.” And you, as a customer, receive a message in the app asking for confirmation.
We are working with BBVA to bring this proposal to its clients. They have licenses from these two companies and we have the technology and the know-how. We can work with anyone who has an API, a bank or a development company, integrate and create a service flow.
M.I.A.: What is your average client like?
Z.N.: Our clients are very diverse. Some are hospitality companies, like the Botín restaurant. In the Mercado de San Miguel, half of the stalls were our clients. There are also hotel chains, such as OnlyYou. We have clients that are apps that have generated ‘miniapps’ within ‘superapps’; these are small programs to offer services. If the client is interested, we develop a ‘miniapp’ for them; if not, we can integrate the means of payment. We also have companies that, with the pandemic, have realized that what we were telling them back in 2019 was not such a crazy idea. They said: how am I going to put a QR code on my table? They have seen that there are options on the market that can be very useful. We have also developed modules for e-commerce platforms such as Magento, Prestashop or Shopify, so that customers can implement these means of payment in their online stores.
M.I.A.: Do you help companies to sell to Asian clients in Spain?
Z.N.: In 2018 and 2019 we were very focused on tourism and Chinese clients residing in Madrid. But with the pandemic, all tourism stopped, so we started offering more consulting and even business development services.
Chinese customers are the most digital globally. They spend a lot of time on their mobile phones, investigating their surroundings or what items to purchase. We observed that they go to the shops and take photos and videos which they post on their WeChat accounts, and how they were contacted by someone who is watching from outside and also wants to make a purchase. Can you imagine what the shopping experience would be like if you have a means of payment in your store that enables communication in real time? That customer will be happier still if you facilitate the payment process. He or she is probably an ambassador for your own brand. And so the customer has sold a handbag in five minutes. When he or she returns to China, your brand will continue to be present and if you have good visibility you can communicate with them. The experience is the same as sending items through a logistics company, but here you do it through another channel. We have a small marketing team that posts, communicates, and helps these companies generate traffic and sell.
M.I.A.: What is the main barrier for SMEs in Madrid to enter China? And what do they look for when they go? How do they carry out their expansion projects: do they hire people there, do they hire specialists in Spain…?
Z.N.: There are different problems. Spanish SMEs without experience in internationalization can come up against significant cultural barriers. But we can help with our advice, offering assistance with the internationalization plan and providing solutions to problems that may arise. To give you an example, a school that has several Chinese students has hired us following an increase in demand. Parents who send their children to study abroad are a growing market. And they have no experience in China. We have helped them, first, by asking some Chinese students to tell us about their experiences in order to give them publicity; then by creating a marketing plan to give them more visibility on social networks, where opening official accounts is complex and bureaucratic. And when we are established in networks, we will do SEO and SEM in Chinese search engines. We will also have a presence within the ‘superapps’. It is a joint strategy.
M.I.A.: What can Madrid offer to the typical Chinese customer? And to a Chinese company?
Z.N.: Madrid is the capital of Spain, which is very important, because in general all the capitals in China are very well positioned. The cultural offer is very good: the Chinese like museums, restaurants that are hundreds of years old, the activities that can be done throughout the Community of Madrid and the visits to nearby cities like Toledo or Segovia. The average Chinese is not after sun and beach holidays, they are just not interested. That said, I don’t know why but we have more clients from Barcelona. Barcelona has an office of the Generalitat in Beijing that has been promoting Barcelona city for many years.
MIA: And beyond tourism?
Z.N.: Little by little, it is attracting more attention in terms of investment. It is a strategic point of reference at the European level and as a gateway to Latin America. When the Chinese talk about investing or coming to Spain, they see us as an entry point to Latin America because of the culture and shared language. When it comes to doing business there, Spain is a benchmark country. To give you an idea, Aliexpress is based in Madrid. This is the vision of the big Chinese multinationals. Huawei also has a very important presence here; the big telcos are also setting up shop little by little… They know exactly what they want. Madrid has a good reputation but we have to work on it. Others invest more than us: Paris, London. These are points that should be addressed.
M.I.A.: What points should be promoted?
Z.N.: First and foremost, security. Secondly, the cultural offer. And thirdly: the direct connections to Latin America. We have not carried out a detailed analysis yet, but I would highlight those three points beyond the tax advantages and other factors. The Chinese do not go directly to Latin America out of fear.
M.I.A.: How can Madrid compete against the Chinese macro-cities, if at all? Is there anything it should learn from them?
Z.N.: They are different realities. In Shenzhen, Shanghai or Beijing the population size is almost as big as our entire country. From my point of view, it is very different. Keep in mind that, regardless of whether they are a communist country, China is the most capitalist country at a global level. You must learn to play in two different worlds. What can we learn? I see a very clear lesson in how they have gone from keeping their money under the mattress to digitization in record time. Everyone uses these systems. I believed that in Spain the level of digitization was much higher than it actually is. We are way behind.
M.I.A.: Tantum was one of the winners of El Despertador, a business accelerator initiative run by the City Council. How has this program helped you?
Z.N.: The truth is that it was a good idea to sign up. We were in a complex moment of transition and this gave us an important boost, especially at the emotional level. Why? It is not so much about the prize, which was symbolic, but the network of contacts that we are generating through this program and the visibility that it gives us. Companies like BBVA, Bankia, La Caixa, Sacyr, the Ecofin Forum are very interested in our solution… We are accessing entities and institutions that were unimaginable before this.
In China I am used to the tremendous pace of doing business. We get together and if we see the opportunity, we go ahead. Here, both in the Administration and at the private level, it is more complicated: first you have to gain access, then they have to listen to you, then you present them with a project and then they make a decision. In the end, there are very few companies that succeed and many fall by the wayside.
M.I.A.: Is there anything else the Administration can do to help you develop your business?
Z.N.: Above all, help us access companies of different sizes in Spain. Although they are already supporting us in that sense, since we won the contest, the situation has changed and they give us full support. That is enough. Visibility generates more business.