Published On: Wed, Dec 4th, 2019

Latin America roundup: Neobanks lift $205M+; Softbank backs VTEX

Argentina’s Ualá became a many new Latin American fintech to accept a growth-stage appropriation ($150 million) from Asian investors, Tencent and Softbank. 

This outlines Tencent’s second turn of investment in Ualá, a initial entrance in Apr 2019. Tencent also invested $180M in Brazil’s heading neobank, Nubank in 2018. With Ualá, Tencent and Softbank will join a group of investors including Soros, Goldman Sachs, Endeavor, Monashees, Ribbit Capital, and Jefferies LLC, who have corroborated Ualá given it was founded in 2016. Ualá has supposing over 1.3M accounts for unbanked and under-banked Argentine business in a past dual years and recently launched new products for lending and savings. 

Ualá was not a usually neobank celebrating a poignant turn this month; Brazil’s Neon lifted a $94M Series B turn from Banco Votorantim and General Atlantic only one week earlier. Neon offers a fully-digital bank label to roughly 2M business opposite Brazil, mostly clever in Rio de Janeiro and São Paulo. The turn will capacitate Neon to enhance over Brazil’s biggest cities and double a user bottom in 2020. 

Neon has lifted $121M to date, with prior investors Quona Capital, Propel Venture Partners, Omidyar Network, and Monashees, also fasten their many new round. The two-year-old startup has been expanding a product offerings to embody credit, investment, and many recently, a personal lending line in Jul 2019.

Neon’s products are assisting to move banking services to a famously formidable and rival marketplace in Brazil. Brazil’s largest neobank, Nubank, is valued during $10B+, has 10M business in Brazil and Mexico, and is now a most-downloaded neobank in a world. Brazil’s banking zone is one of a many remunerative in a world, with credit label seductiveness rates reaching triple digits, since Nubank and competitors offer some-more US-style rates, putting Brazilian banks on a defensive opposite disruptors like Nubank and Neon who will expostulate competition. 

With clever appropriation from Asia, Brazilian, and US-based backers, these neobanks are gaining traction opposite a segment to yield banking services to a 50% of Latin America’s race that is still released from normal financial institutions. 

Softbank invests $140M in VTEX

VTEX, a Brazilian cloud e-commerce height for vast companies, assimilated a flourishing list of Softbank’s Brazilian portfolio companies, including QuintoAndar, MadeiraMadeira, Creditas, Buser, Gympass, and Loggi. The Japanese financier is ancillary VTEX with a $140M investment to assistance a startup enhance internationally and rise new products. 

VTEX already has 14 offices in Latin America, Europe, and a US, and serves over 2500 tellurian clients including Ambev, Nestle, North Face, Coca Cola, and General Electric. VTEX’s resolution involves a extensive digital commerce height including sequence management, B2B marketplaces, web and in-store points of commerce, and patron service. As a back-end for some of a world’s largest companies, VTEX provides an huge event for formation with other marketplaces and platforms. 

LinkedIn expands to Mexico

Mexico is Latin America’s second-largest marketplace after Brazil for many US tech companies like Uber and Facebook. In Nov 2019, both LinkedIn and Stripe announced their goal to enhance into a Mexican marketplace with offices and operations. Over 13 million of Linkedin’s 92 million sum clients are in Mexico, creation this nation a judicious place for Linkedin’s second Latin America office. Linkedin non-stop their initial Latin America offices in São Paulo in 2013. 

The Mexican bureau will open in Jul 2020 and will assistance LinkedIn furnish some-more Spanish-language content, as good as move users closer to vast clients like BBVA and Aeromexico. 

Notable Rounds and Acquisitions from November

  • Brazilian bank Itaú acquired growth-hacking and digital consulting startup, Zup, for a $140M understanding that will be disbursed over 4 years. Zup will assistance a bank urge and rise digital channels for patron merger and management. Although Itaú now owns 51% of Zup, a dual companies will continue to work alone and underneath opposite brands for a foreseeable future. Acquisitions of this distance are still really singular in Latin America and yield liquidity into a startup ecosystem that can foster a expansion of a some-more energetic sourroundings for tech companies. 
  • MUY Tech, a Colombia cloud kitchen startup, lifted $15M this month to enhance into Mexico and Brazil. MUY uses AI record to predict food trends and emanate reduction waste, permitting users to sequence personalized dishes from MUY’s earthy restaurants or by a mobile app. The startup now serves some-more than 200,000 dishes per month, according to owner Jose Calderon, who formerly exited Domicilios to Delivery Hero. Mexican financier ALLVP led a turn with support from prior financier Seeya.
  • Brazilian mobility startup Kovi lifted a $30M Series B led by Global Founders Capital and Quona Capital, with support from prior investors Monashees, Maya Capital, Kevin Efrusy, Y Combinator, Broadhaven Ventures, Justin Mateen, and ONEVC. Kovi rents cars to drivers that work for rideshare companies like Uber, Didi, or Cabify to make peculiarity vehicles accessible to these intensity gig-economy workers. They will use this investment to grow a group and fleet, as good as exploring new geographies. 
  • Mexico’s practical supermarket, Justo, lifted $10M in a seed turn from Foundation Capital to continue flourishing in a internal market. Justo is a initial grocery store in Mexico with no earthy branches, regulating a D2C indication that has been augmenting in approval in Latin America. The startup was founded by Ricardo Weder, a former boss of Cabify, progressing in 2019 to interrupt a greedy grocery industry. 
  • Brazil’s temperament corroboration startup, idwall, lifted $10M from Qualcomm Ventures to continue building facial approval program that helps vast companies like Loggi, 99, and OLX to determine a temperament of their employees and customers.

Looking forward to December, Latin American financial institutions are on a surveillance for a unsure destiny formed on a new disturbance in countries like Chile, Bolivia, Ecuador, and Colombia. This instability competence yield a rival corner for fintech startups who can use real-time information to adjust some-more fast to a changing situation. 

What to watch next? International investors have not pulled out of a segment notwithstanding new domestic misunderstanding and many are peaceful to wait out this duration to support their startups. While we might not have entrance to Q4 2019 for a few months, it will be engaging to see if expansion and investment have been rocked by a changes of a past dual months. Certainly a standing quo for a normal players in Latin America is fast changing, potentially withdrawal room for startups to take over some-more marketplace share and contest for discontented customers.

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