According to LAVCA’s latest State of the Industry Report, Latin American startups received a total of USD$500M in all of 2016. In just the first 6 months of 2017, they received USD$477M.
It is clear that Latin America is experiencing a substantial uptick in venture capital activity. For one, Series C rounds in Latin America totaled USD$314M for the first half of 2017, compared to USD$208M raised in all of 2016.
Additionally, the investments in 99, Brazil’s largest rideshare service, by Didi, China’s largest ridesharing company, represented two of the top three largest investment rounds of all time in Latin America.
The report also uncovered that 93% of the funding that Latin American startups received this year in VC funding went to the IT sector. This is almost triple the amount that was invested in the fiscal year 2016 through the same number of deals.
It’s clear that big-ticket investments are beginning to become more popular in Latin America. VC attitudes are also changing for the positive, with most VCs planning to maintain their investments in the region over the next three years or more, including many of the new entrants in the market.
Just two years ago, most VCs from the U.S. and China avoided Latin American startups, except for a few select deals in Brazil.
However, this year marked an inflection point with US-based Andreessen Horowitz, Redpoint, Accel and other top-tier VCs making significant investments in Latin America, as well as Didi investing in Brazil’s 99.
As we look back on the incredible growth of the Latin American ecosystem over the past year, it’s important to highlight some of the key players across the region.
Below is an overview of the organizations driving the venture capital growth in Latin America, along with helpful links to the many firms, accelerators, and resources in each country.
Kaszek Ventures – This Latin American venture capital firm focuses on high-impact technology companies in Brazil and across the region that want to operate in Latin American markets. The fund managers have origins in MercadoLibre, one of Latin America’s startup unicorns that was founded in Argentina. Kaszek provides not only capital but also hands-on mentorship, networking, product development, team-building, and plenty of resources to help entrepreneurs develop viable businesses. So far in their three funding rounds, Kaszek has supported the growth of 43 companies in the Southern Cone region. Their third and largest fund reached $200M this year to help Latin American entrepreneurs build amazing companies.
Patagonia Ventures –This Buenos Aires-based private investment fund focuses on high potential Latin American Internet businesses. The firm has already had eight successful exits out of 21 investments. The team is focused on active and global investments that bring investors and entrepreneurs together to nurture innovative ideas.
NXTP Labs – NXTP Labs is one of the most active funds in Latin America, with operations in Argentina, Chile, Colombia, Mexico, and Uruguay. The firm has backed many of the region’s top startups and acquisitions, including Fundacity, Aventones, Sparkflow, Cookapp, ComentaTV, WeHostels, and more. The MIF is the first anchor investor in NXTP Labs’ new impact investing fund that will provide seed capital for approximately 32 companies. NXTP Labs also offers special programs for agtech and fintech companies in Latin America.
IncuBAte – IncuBAte is a new incubator program open to national and international entrepreneurs with high-impact ideas. Offering a network of mentors and elite connections, startups that are chosen to participate will also receive USD$30K, equity-free and office space.
Draper Cygnus – Draper Cygnus is a Silicon Valley-based VC fund for Argentina that focuses on supporting entrepreneurs whose tech or business models have the potential for massive social change. They focus on fintech, agtech, cleantech, and nanotech and have thus far empowered 28 Argentine companies with over USD$105M in investments.
Other notable venture capital firms in Argentina include CAP Ventures, Quasar Ventures, Pymar Fund, Cygnus Ventures, Enzyme Venture Capital, South Ventures, Alaya Partners, Victoria Capital Partners, Jaguar Ventures, Wayra, and Incutex. Click here for a complete guide to venture capital in Argentina.
Monashees+ – Monashees+ is a global venture capital firm based in São Paulo that invests in innovative entrepreneurs at the early stages of their ventures. Their portfolio includes companies focused on improving lives through technology, such as 99, Rappi, VivaReal, and Petlove.
Valor Capital Group – Valor focuses on US/Brazil cross-border opportunities and is based in New York, Menlo Park, and Rio de Janeiro. They look for early- to late-stage US or international technology companies seeking to expand to Brazil, as well as Brazilian technology companies. Valor Capital Group’s companies solve the problems that face the middle class, especially in fields of education, financial services, and health.
Redpoint eVentures – Redpoint eVentures is an early-stage venture capital firm located in São Paulo, Brazil. The firm is partners with Redpoint Ventures and e.ventures in Silicon Valley and boasts an impressive portfolio of 15+ companies, including big names like Rappi and Gympass.
ACE – ACE is a major player among accelerators in Brazil, investing over $500 thousand reais in promising startups each year. Previously known as Aceleratech, ACE is considered among the top funds in Latin America, nurturing over 130 startups during its operations. ACE was voted three times as the best accelerator in Latin America.
In Brazil, other notable venture capital firms include Criatec Fund, SP Ventures, Instituto Inovacao, Ideiasnet S.A., Confrapar, Astella Investimentos, Warehouse Investimentos, W7 Venture Capital, and DGF Investimentos. Click here for a complete overview of venture capital in Brazil.
Magma Partners – Magma Partners is the only fully-private investment fund in Chile. We invest early stage and like to be first investors into companies. Our initial investments are in the US$25-$75K range and we can follow on with up to US$250K per company. We’re focused on supporting the best entrepreneurs in Latin America that want to launch and scale in the US, and fintech and insurancetech startups in Latin America. Since 2014, we’ve invested in 32 companies with founders from 10 different countries and now have offices in Chile, Colombia, Mexico, US and China.
Mountain Nazca – In 2015, Nazca was acquired by Mountain Partners, a successful German/Swiss VC and company builder. The firm invests USD$200-$500K in companies that can scale regionally and potentially expand to other Mountain offices in Europe, Asia, and Africa. Nazca has offices in Argentina, Chile, Brazil, Colombia, and Mexico in Latin America.
Start-Up Chile – Start-Up Chile is the flagship program from CORFO and the Chilean government. The program has financed more than 1,300 Chilean and foreign startups since 2010 with its Seed program that provides CLP$20M pesos (USD$30K) equity-free grants. In 2015, Start-Up Chile added the Scale program, a CLP$60M pesos (USD$90K) equity-free follow-on fund, as well as the S-Factory, a CLP$10M (USD$15K) pre-accelerator program for female entrepreneurs.
Other firms investing in Chile include NXTP Labs, Chile Ventures, FEN Ventures, Endurance Ventures , Manutara Ventures, Scale Capital, and Aurus. Click here for a complete overview of venture capital in Chile.
Firstrock Capital – Firstrock Capital (previously Social Atom Ventures) is a USD$30M investment fund with offices in Medellin and Bogota. The firm specializes in connecting Latin America’s tech talent with US startups that need technical support. They mostly invest in early-stage companies that have technology teams in Latin America, but whose target market is the US. Magma Partners has co-invested twice with Firstrock Capital.
FCP Innovacion – FCP Innovacion is a USD$40M capital fund that is 100% backed by Empresas Publicas de Medellín, Medellin’s utility company. Their investments are mostly focused on natural resource management, such as oil, water, natural gas, and waste management innovations. Currently, they have seven active investments across five Latin American countries.
Other venture capital options in Colombia include Torrenegra Labs, Axon, Velum Ventures, and more. Click here for a complete overview of venture capital in Colombia.
500 Startups: Latam – 500 Startups: Latam is a Mexico City-based accelerator and the most active fund in Mexico. They’ve invested in 1,800+ companies since their inception and have some very successful companies in their portfolio. 500 Startups: Latam is part of a trend of US funds and accelerators investing in the Mexican market. Famous graduates of 500 Startups: Latam include Konfio, Clip, and CinePapaya.
Hackers and Founders – Hackers and Founders is a US-based company that helps accelerate startups and helps them raise money in the US. They have an office in Guadalajara and have helped at least 20 companies in Mexico so far. Hackers and Founders charges equity for their services and creates a stock pool so that all 20 companies in a round receive equity in each other. So far, they have over 200,000 entrepreneurs as members in 47 countries worldwide and a portfolio worth USD$400M.
Avalancha Ventures – Avalancha Ventures is an early-stage fund that invests up to USD$50K in first rounds, with follow-on funding up to USD$2M available. The fund invests in Mexican companies and is worth USD$15M.
Mexico is home to many other venture capital firms, including Jaguar Ventures, Variv Capital, Alta Ventures, Mita Ventures, Angel Ventures Mexico, Investo VC, among others. Click here for a complete overview of venture capital in Mexico.
Endeavor – Endeavor is a global organization that promotes high-impact entrepreneurs in over 25 countries worldwide. The organization arrived in Peru in 2014 and became a leader developing the ecosystem, supporting over two dozen entrepreneurs who represent 14 companies.
Angel Ventures, a Mexico-based VC, has a local presence in Peru through its Angel Ventures Peru branch office. Angel Ventures Peru has sourced deals from Latin America for the regional fund, but the fund has
Startup Peru – Startup Peru is a Ministry of Production program based on the Start-Up Chile model. It has financed more than 150 Startups with its equity free grants and finances up to 24 projects at a time, depending on the stage of the startup. Deenty, a Magma portfolio company, was part of Startup Peru.
UTEC Ventures – UTEC Ventures is a Peruvian accelerator that is tied to UTEC, a local engineering university. UTEC typically takes a 5-10% equity stake in exchange for $15K in seed capital and additional services. It has quickly become an important player in the local ecosystem with many of its companies receiving follow-on funding.
In Peru, other notable venture capital firms include Wayra, EmprendeUP, and Fledge. Click here for a complete overview of venture capital in Peru.
US Firms investing in Latin America
LatinSF – LatinSF is a new economic development initiative that promotes business and trade between San Francisco and the Latin American region. This initiative comes from a public-private partnership between the Mayor’s Office of Economic and Workforce Development (OEWD) and the San Francisco Center for Economic Development (SFCED), with the goal of creating a welcoming environment for established Latin American companies to expand and for startups to relocate to San Francisco.
LEAP Global Partners – LEAP Global Partners is a US-based VC firm focused on training and empowering Latin American entrepreneurs that are making an impact in finance, health, education, the shared economy, or in media. They have around USD$15M in funding available and have invested in three tech companies in Latin America.
LATAM Fund – The LATAM Fund is considered to be the first VC fund born in Silicon Valley with a focus on Latin America. They provide mentorship and seed stage capital to tech companies in Latin America that are focused on the Hispanic market in the US. Their ZFunction and ZReady programs accept eight to ten startups per program, with two programs a year. They also invest without asking for any equity.
Babel Ventures – Babel Ventures is a Silicon Valley-based venture capital firm raising $30 million to help accelerate Latino-owned businesses in the U.S. and Mexico. The founders, Bárbara Kunde Minuzzi and Daniela Arruda, are both from Brazil and previously raised funds for other real estate and tech funds.
For more US venture capital firms investing in Latin America, check out this list of Latinx Resources in the Bay Area by Jackie Hyland of Silicon Valley Bank.
Regional Firms investing in Latin America
The following firms, many of which are mentioned above, also invest regionally:
Magma Partners, Mountain Nazca, NXTP Labs, Kaszek Ventures, Monashees+, Wayra, and 500 Startups.
If you have a resource you’d like to include on this list, please leave it in the comment section.