Belvo scores $10M from Founders Fund and Kaszek to scale its API for financial services

Belvo, a Latin American fintech startup which launched just 12 months ago, has already snagged funding from two of the biggest names in North and South American venture capital.

The company is aiming to expand the reach of its service that connects mobile applications in Mexico and Colombia to a customer’s banking information and now has some deep-pocketed investors to support its efforts. 

If the business model sounds familiar, that’s because it is. Belvo is borrowing a page from the Plaid playbook. It’s a strategy that ultimately netted the U.S. startup and its investors $5.3 billion when it was acquired by Visa in January of this year.

Belvo and its backers, who funneled $10 million into the year-old company, want to replicate Plaid’s success and open up an entire new range of financial services companies in Latin America.  

The round was co-led by Silicon Valley’s Founders Fund and Argentina’s Kaszek. With the new arsenal of capital complimented by the Founders Fund’s network and Kaszek’s deep knowledge of the Latin American market, Belvo hopes to triple its current team of 25 that is spread across operations in Mexico City and Barcelona. 

Since its initial establishment in May 2019, the company has raised a total of $13 million from Y Combinator (W20) along with some of the biggest players in Latin America’s startup scene. Those investors include David Velez, the co-founder of Brazil’s multi-billion dollar lending startup, Nubank; MAYA Capital and Venture Friends. 

The company’s co-founders, Pablo Viguera and Oriol Tintoré are no stranger to startups themselves. Viguera served as COO at European payments app Verse, and is a former general manager of one of the big European neo-banks, Revolut. Tintoré is a former NASA aerospace engineer, and while working for his Stanford MBA, founded Capella Space, an information collection startup that went on to raise over $50 million. 

The company said it aims to work with leading fintechs in Latin America, spanning across verticals like the neobanks, credit providers and personal finance products Latin Americans use every day.

Belvo has built a developer-first API platform that can be used to access and interpret end-user financial data to build better, more efficient and more inclusive financial products in Latin America. Developers of popular neobank apps, credit providers and personal finance tools use Belvo’s API to connect bank accounts to their apps to unlock the power of open banking.

Viguera says the capital will be used to open a new office in Sao Paulo, and invest in new product and business development hires. Notably, Belvo is only one year old, having launched in January 2020 and operative in Mexico and Colombia. 

Co-founders Pablo Viguera and Oriol Tintoré are a former Revolut GM and former NASA aerospace engineer.

 

Belvo’s latest funding also marks another instance of a U.S.-Latin America investment teamup for a Latin American company.

Nuvocargo, a logistics startup that wants to bolster the Mexico – U.S. trade lane with its freight transportation technology, also recently raised a round co-led by Mexico’s ALLVP and Silicon Valley-based NFX. American investors may be starting to take note of the co-investment opportunity of putting capital into startups serving the Latin American market in partnership with successful new wave domestic funds like Mexico’s ALLVP and Argentina’s Kaszek.  

Nuvocargo, a trucking managed marketplace, raises $5.3M in seed funding

U.S. companies rely on Mexican manufacturers for goods ranging from automotive and aerospace parts, to avocados and other produce, to electronics and furniture. But the trucking system that transports these things across the border relies on an inefficient mix of paper, phone calls, faxes and too many stakeholders who drive up costs.

These snarls congesting border traffic are precisely why Nuvocargo founder and CEO Deepak Chhugani has raised a $5.3 million seed round for a managed marketplace for door to door freight transportation, serving trade routes between the United States and Mexico. 

Investment came from both sides of the border. The round was co-led by Silicon Valley-based NFX and Mexico City-based ALLVP. And Nuvocargo marks the first deal for Antonia Rojas-Eing, the youngest female VC in Latin America, under ALLVP, which she joined earlier this year as a partner. 

The seed round also saw participation from One Way Ventures, Maya Capital, Magma Partners, the co-founders of Rappi, the former CMO of Cabify and other angels. The total includes earlier backing from Y Combinator, when Nuvocargo existed under a different name.

Chhugani joined Y Combinator’s W18 class with a startup called The Lobby, which sought to connect job seekers to personalized coaches. He raised $1.2 million for the startup, but decided to pivot into logistics and work on Nuvocargo. The change in direction was fairly natural for the Ecuador-raised entrepreneur, who cited his family’s previous work in the Latin American logistics industry.

When the time came to pivot, Chhugani offered investors their money back. Some chose to leave, but Y Combinator elected to stay under the new promise of digitizing trucking between Mexico and the U.S. Nuvocargo says that the $5.3 million seed is its first round, and what they’ve raised to date. Investors who stayed in from The Lobby are part of this round for Nuvocargo.

Nuvocargo, which calls itself a modern managed marketplace for door to door freight transportation, has set up shop with fully bilingual teams in both New York and Mexico.

Mexico is already one of the United States’ largest trade partners, and Chhugani predicts that relationship will only strengthen in the next decade. The U.S.-China trade war shows no signs of easing and tariffs have increased buying friction. With the 2018 United States-Mexico-Canada Agreement that aims to renegotiate NAFTA and uncertainty around coronavirus, Chhugani believes Mexico will become an even more attractive trade opportunity to capitalize on with Nuvocargo. 

To the company’s knowledge, U.S.-Mexico trucking is within the top five biggest trade lanes in the world, with 6.5 million trucking shipments going between Mexico and the U.S. every year. Notably, 80% of all the goods transported between the U.S. and Mexico move by truck.

VCs have jumped on the freight and logistics opportunity as startups like NEXT Trucking, Convoy and Flexport secure hundreds of millions dollars from investors like Sequoia and SoftBank. 

Now, smaller startups like Nuvocargo that specialize on specific routes and countries are focusing in regionally to bring online these systems that rely on paper, phone calls, faxes and spreadsheets to do business. 

Nuvocargo’s free software digitizes the different steps with timestamps, geo tracking and document housing in a centralized cloud-based dashboard, providing a snapshot understanding of every step of a cross border shipment. Customers can request new shipments using Nuvocargo using a WhatsApp integration, email or SMS. 

The 15-person startup wants to house the entire shipping process within its tracking software, simplifying the customer experience. The customer, Chhugani says, is any company that needs to move goods between Mexico and the U.S., and he notes that Nuvocargo is working with dozens of customers ranging from beverage companies to multi-billion-dollar corporations — though he declined to specify who. 

Chhugani says that in a typical U.S.-Mexico cross-border trucking transaction, up to 12 stakeholders are involved in a single shipment, and that is too many. Multiple people on the U.S. side are procuring the trucks and managing customs, FDA inspection and warehouse storage. On the Mexico side there are even more entities handling scheduling and pick up for the trucking companies and drivers. 

With the new seed funding, Nuvocargo will prioritize early hires in product, operations, finance and engineering in its New York and Mexico offices on its fully bilingual team. 

Chhugani says he’s especially appreciative of the truck drivers that put themselves in harms way to ensure critical items are getting to the right destination, ensuring shelves are stocked. He says that in this uncertain time, Nuvocargo is working to give drivers predictable business near their homes, and pay them faster. “All of us as a society should be more appreciative of truck drivers and the trucking industry, because this is something that really fuels the economy in both the United States and in Mexico.” 

In the current age of the coronavirus pandemic, Nuvocargo says it is focusing significant efforts on working with companies that are transporting essential goods to aid in the supply crisis.

The 20 best startups from Y Combinator’s W20 Demo Day

With world events overtaking the tech world’s preferences to meet for coffees and convene at events, Y Combinator skipped its famous two-day live Demo event and went for a radical experiment: no demos at all, but instead a long list of the nearly 200 startups in its Winter 2020 batch, with links to their sites and one-page slides. We’ve done the legwork for you in giving you a full rundown of who does what, and we have also come together on a group video chat on Zoom to talk through our takeaways of the format this year (missed it? here’s the recording). Now, in no particular order, here is our shortlist of some of our overall favorites.

Latin America roundup: SoftBank adds $1B, Stori raises $10M and Grow Mobility puts on the brakes

After investing nearly $2 billion of its Innovation Fund in Latin America in 2019, SoftBank announced this month that it would add an additional $1 billion into the fund to continue supporting tech startups across the region. While the Japanese investor faces the challenge of raising a second global fund after its Vision Fund, SoftBank is still investing heavily in Latin America. 

One of its early Latin American investments — and the first in Colombia — Ayenda Rooms, is performing particularly well, raising $8.7 million from Kaszek Ventures this month. Ayenda is the local version of Oyo Rooms, one of SoftBank’s biggest bets in India, which has looked to expand into Mexico despite a financial crunch last month. In fact, the fund recently came under scrutiny by The Wall Street Journal for funding similar delivery competitors Uber, Rappi and Didi, suggesting a conflict of interest. 

Most recently, SoftBank invested $125 million in Mexico’s lender, Alphacredit, and they reportedly plan to continue investing in that niche. The firm currently oversees more than 650 companies in Latin America, largely concentrated in Brazil, Argentina, Chile, Colombia and Mexico, and plans to invest $100-150 million in 17 firms and two VCs by the end of the year. To date, over 50% of SoftBank’s investments have been into Brazil, most of which exist in the fintech sector. 

Mexican neobank Stori raises $10 million Series A

In a self-fulfilling prophecy, Mexico’s neobank market became all the more competitive this month with the addition of a new player: Stori. Within the past few months, both TechCrunch and Business Insider pointed to Mexico’s neobank market as the one to watch in Latin America as startups like Albo, Klar and Nubank battle for market share. In February, digital bank Stori joined the conversation with a $10 million Series A from Bertelsmann Investments (BI) and Source Code Capital, along with an existing investor, Vision Plus Capital.

This round of funding, led by Chinese investors, is part of a growing trend of foreign funds waking up to the Latin American startup ecosystem, Asian VCs in particular. Tencent has invested in Brazil’s Nubank, which has since expanded to Mexico, and in Argentina’s Uala, which is considering a similar move. SoftBank has investments in the largest lending and credit startups in Brazil and Mexico, as well. 

Stori will use the investment to improve its AI technology as it tries to reach over 100,000 Mexicans through its inclusive digital banking services. The neobank has raised over $17 million from investors since it was founded in 2018.

Grow Mobility pulls out of 14 cities

In January, Rappi and Lime pulled back their operations in Latin America in order to focus on technology over rapid growth. Brazil’s top mobility startup, Grow Mobility (which rose out of a merger between e-scooter companies Grin from Mexico and Yellow from Brazil) also pulled back. The startup, which provides e-scooters and bikes shares across Brazil, took bicycles out of operation and removed its scooters from 14 cities. 

Grow also restructured its operations through layoffs that affected employees across Brazil, although they did not comment on how many people were affected. Grow Mobility’s scooters will now only operate in Rio de Janeiro, São Paulo and Curitiba. 

This pattern of pull-back following explosive growth has become more common among Latin America’s biggest startups, pushing these early-stage companies to focus on technological solutions that boost revenue, rather than blitzscaling measures that only buy market share.

Amazon Web Services doubles down on Brazil

Amazon Web Services (AWS) announced it would invest $236 million (R$1 billion) into São Paulo over the next two years to strengthen its Latin American infrastructure. This effort may be a part of Amazon’s work to consolidate market share in Latin America’s increasingly competitive e-commerce market, where legacy players like MercadoLibre still dominate. This investment will enable Amazon to expand its Brazilian data centers and improve local service offerings to both private and public partners. 

Amazon also announced that it would build a new distribution center in Pernambuco in the north of Brazil to support sales across the country. Brazil accounts for almost 40% of Latin America’s e-commerce market, making the country vital to Amazon’s positioning in the region.

News and Notes: Weel, Global 66, Yuca and Memed 

Weel, a Brazilian accounts-receivable management platform, announced an $18.4 million investment from Banco Votorantim, Brazil’s seventh-largest bank, in February 2020. This investment was Banco Votorantim’s second in the startup after a $6 million contribution in 2019. Weel will use the investment to explore expansion across Brazil, as well as exploring Chilean and Mexican markets. 

Chilean international transfer startup Global 66 received $3.25 million in February from U.K. investor Venrex, to continue its expansion across the region. The startup currently offers rates up to eight times better than existing transfer services, especially for the Latin American region. Global 66 recently opened new offices in Peru and plans to expand to Colombia, Argentina and Mexico within the next two years. Within just two years of operations, Global 66 has processed transactions for over 25,000 users across 60 cities worldwide.

Yuca, a Brazilian proptech, raised $4.7 million from Monashees, ONEVC and Creditas to help fight housing crises in Brazil’s largest cities. As Brazil’s cities sprawl — São Paulo is one of the largest in the world — Yuca creates central co-living spaces for young people that want to shorten their commutes. Inspired by Chinese startup, Ziroom, Yuca currently manages 18 apartments for 80 students and plans to scale to 500 apartments by the end of the year.

Brazil’s digital prescription startup, Memed, recently raised $4.5 million from DNA Capital and Redpoint eVentures to improve the local prescription system for doctors and patients alike. Today, Memed has over 80,000 registered doctors who have created over 10 million prescriptions worth more than $237 million. Memed’s 100% digital prescriptions are said to improve security and efficiency in Brazil’s complex, bureaucratic healthcare system.

While Brazil is still at the forefront of Latin America’s tech ecosystem, Mexican fintechs are edging up, especially with additional support from international investors. 2020 is off to a strong start, hinting at another potential record-breaking year for Latin American tech investment.

Homie CEO resigns after allegations of sexual harassment from job applicant

Jordi Greenham, the co-founder and CEO of Mexican long-term rentals startup Homie, has resigned after a sexual harassment investigation was carried out by the company’s ethics board.

On February 14, Homie launched an investigation into allegations of sexual harassment against Greenham, according to a corporate Facebook post. The message followed reports of sexual harassment that were posted to Facebook earlier the same day. In them, a woman, who has asked to remain anonymous to protect her privacy, claimed that CEO Greenham propositioned her in a WhatsApp message around 1:30 a.m. on February 14 to spend the night with him in exchange for 3,000 pesos (about $150 USD).

Below is a screenshot of her Facebook post, which translates to English as:

Today, Jordi Greenham Asensio, co-founder of Homie offered me money to spend the night with him. It should be noted that we do not have a personal connection and that he contacted me on LinkedIn a few months ago to offer me a job at his company, we communicated through WhatsApp to schedule the interviews and for his team to communicate with me. I carried out the process and I did not get the position and there, that is the extension of the “relationship”.

It is not correct that someone, in this case a man, thinks that it is acceptable to make these types of solicitations. It makes me angry that I delayed in saying something about this in thinking that there are no consequences for these types of actions. Attached evidence of the conversation.

The WhatsApp exchange can be translated to English here:

Homie CEO Greenham:

Hi

I would like to see you

Recipient:

Can you explain to me the random texts at strange hours?

Homie CEO Greenham:

No, there is no rational explanation.

It was irrational. But I understand that it doesn’t interest you

How much could I pay you for one night?

3,000?

The woman tells TechCrunch that she met Greenham once through a mutual friend five years ago but had no contact with him since that initial introduction until he reached out to her on LinkedIn in September 2019. She told TechCrunch she had been interested in a role at the fast-growing startup, and communicated with Greenham over WhatsApp to arrange interviews and discuss the position. Ultimately, after interviewing for the role, she says she never heard back from the company.

TechCrunch reached out to both Greenham and Homie on February 21. Homie responded to TechCrunch’s request for comment on the 23rd with this statement:

On the 14th of February, the Homie Board of Directors was informed of the unacceptable behavior of the CEO and took immediate action. The Board’s Ethics Committee carried out the necessary investigation and on the 16th of February, after having discussed it internally, Jordi Greenham Asensio resigned as CEO and President of the company. The fast and unwavering action of the Board reflects our commitment for the highest standard of conduct, in all levels of the organization. The opinions and comments of Jordi Greenham no longer represent that of Homie.

Homie’s February 14 Facebook post detailed that its code of ethics deems harassment, discrimination and gender violence to be unacceptable and that those standards apply to “all levels of the organization.”

Homie, which has raised $8.2 million, is currently active in more than 100 Mexican cities. According to Crunchbase, the company employs between 100-250 people. Homie recently raised a $7 million Series A round in December 2019 led by Equity International, a fund founded by American billionaire Sam Zell.

Married co-founders are a startup’s secret weapon

“If I was running Clearbanc by myself, it probably would have gone off the cliff eight times at this point,” says Clearbanc co-founder Andrew D’Souza. 

“If I were running the company by myself, it would be half its size,” adds Michele Romanow, Clearbanc’s other co-founder.

In addition to starting the $420 million-backed fintech company together, D’Souza and Romanow are in a relationship.

The two initially met at an event in San Francisco, and followed up with a friendly informational interview at a Mexican restaurant. D’Souza’s fundraising experience was a draw for Romanow, who at the time was looking for information about how to raise cash for her startup. Romanow ended up selling her company to Groupon, but her conversation with D’Souza helped to anchor the valuation. It was also the beginning of a relationship. 

When they started dating in 2014, they swapped war stories about company building. Their connection hinged on this initial commonality — D’Souza had fundraised all his businesses, whereas Romanow had bootstrapped. It was from these conversations that they created Clearbanc, the Canada-based VC firm that specializes in non-dilutive revenue share agreements for startups.

Startups with coupled co-founders at the helm are scoring big funding rounds and exiting companies. Julia and Kevin Hartz co-founded Eventbrite, which went public on the New York Stock Exchange in 2018. Married couple Diane Greene and Mendel Rosenblum were on the co-founding team of VMware, which sold to Dell in 2015. The bond of a relationship may be a secret weapon in company building for new-wave tech startups, but that doesn’t come without risks, like co-founder disharmony, equity supermajority and even divorce.

Clearbanc founders Andrew D’Souza and Michele Romanow

“Just put the phone down.”

Talk to anyone with a co-founder title at a startup and you’ll find one trend: free time is nearly nonexistent. Couples running a business together say it’s advantageous to be on the same workday cycle. “When you’re working on the same business, you’re on the same cadence of when things are blowing up,” says Romanow. “So I know exactly why Andrew is on his phone. I know that if he doesn’t do this, I will have to do it.” 

NEXT Trucking co-founders Lidia Yan and Elton Chung have raised $125 million total for their logistics startup, including a $97 million Series C from Brookfield and Sequoia. The pair says that the company is a presence that’s fully built into their lives and their relationship at all times. While that may be great for a business, it’s not always great for their marriage. “We got into a momentum of talking about work all the time. Not only at the office but at home,” says Yan. The solution is a simple rule enforced by an iPhone alarm. All work-related talk must cease after 8pm every day after the alarm goes off. They also use free time on the weekends to go to restaurants in LA, one of their shared passions. 

NEXT Trucking co-founders Lidia Yan and Elton Chung

Co-founder couples say that if you’re scaling a company, you’ll have to be okay with putting other life decisions on hold, like going on your honeymoon or having kids. 

Leslie Voorhees and Calley Means were married in 2016, but still haven’t taken their honeymoon. They co-founded Anomalie, a wedding dress customization startup that has raised $13 million. Instead of vacationing to Bora Bora the day after their wedding, the newlywed founders hopped on a plane to China, where Leslie stayed for a couple of months to set up the supply chain for Anomalie. The couple admits that even now, they don’t make time for their personal lives.

“We have not spent more than an hour of our entire marriage not talking about wedding dresses. It’s not necessarily the healthiest thing, but we’ve enjoyed obsessing about wedding dresses every day,” says Leslie.

Their skills complement each other: Calley’s superpower is that he can move fast, whereas Leslie is more methodical and good at setting up structure. While they say that being a co-founder couple has strengthened their bond, they’re working on setting boundaries. Being a founder means you have to sacrifice other areas of your life for the company. 

“Once we raise the Series D, we’ll start thinking about having kids,” jokes Calley — in what may not actually be a joke. 

Leslie Voorhees and Calley Means, Anomalie co-founders

Investors are warming up to married co-founders

Clearbanc wants to make it easier and faster for startups to raise growth capital. Their 20-minute term sheet product is meant to help founders raise money in 20 minutes, rather than the traditional 3 to 6 months the process typically takes. But how did investors react to Clearbanc’s co-founders relationship status? Not well, at first. 

A Clearbanc investor passed on an early round, explaining to D’Souza and Romanow that they would have backed either of them individually, but that they were worried about backing them as a couple, especially since they had only been dating for a year at that point.

“The same investor ended up coming in two rounds later at 100 times the valuation,” says D’Souza. This, they felt, proved that fear of investing in a couple was a false sense of increased risk.

It seems investors today agree. When the married co-founders of Apli, a Mexico-based on-demand recruiting platform, walked into the office of ALLVP, the fund wasn’t entirely sure about what it meant to invest in a company run by a married couple.

Founders Vera and Jose met while studying together at Harvard Business School before working at two separate Rocket Internet companies in Mexico and foundling Apli. The business model, product market fit and potential impact for the company were typical factors the fund mulled over before writing a check, but ALLVP also considered the founders’ married status.

“After some discussion, we decided to analyze the team as any other founding team,” says ALLVP partner Federico Antoni. Besides the obvious personal chemistry, there was a professional chemistry between Vera and Jose. “We weighed the risk of divorce and decided to take it. We gained a team fully invested in the company and one that could balance personal life and startup life.” 

Equity could pose another risk factor. Investors could be wary of founder couples depending on the equity structure. If their finances are combined, a co-founder couple could own a supermajority of a startup. Say two non-married founders owned 20% of a company — a co-founder couple whose finances are tied together would own 40%. Given this logic, VCs would inherently have more negotiating power if the founders aren’t financially linked.

VCs I talked to didn’t necessarily agree with that logic, though.

“The only thing with equity that matters to me is if the founders have enough,” says Andreessen Horowitz General Partner David Ulevitch. “Venture capital investments are inherently minority investments, so it’s really just about ensuring founders are motivated and rewarded for building something enduring.” 

But what happens when the dual identities of co-founder and spouse don’t work?

Divorce won’t necessarily be the demise of a startup

Sara and Josh Margulis founded Honeyfund, a honeymoon registry site, in 2006. The then-married couple appeared on Shark Tank in 2015, winning an investment from Kevin O’Leary. Sara says that Honeyfund is different from popular wedding startups like Zola and The Knot in that the core product is a crowdfunding platform enabling newly engaged couples to organize wedding and honeymoon financing. 

When Sara and Josh divorced in 2019, the first instinct was to sell the company. However, “the more we pulled apart professionally, the more opportunities I saw to organize the team the way I wanted to and push the priorities that I wanted,” Sara says. Ultimately, Sara decided she would buy her ex-husband out of the company and continue on a new trajectory as CEO. 

“If we hadn’t been working together, our separation process would have been different. There were truths that needed to be spoken that were emotionally difficult in a marriage, that I didn’t want to put on Josh in the middle of a big Target partnership launch.”

The genesis of their business was rooted in their own experience as a married couple. They’d won the affection of Sharks, operating in a $72 billion industry hinging on the commoditization of love and lasting marriage. But the honeymoon phase can’t last forever. Up to 50% of married couples in the United States will split, according to the American Psychological Association.  

Now, Margulis’ experience of divorcing her co-founder is informing new products and a marketing strategy as she continues to iterate on her startup.

Post-divorce, Margulis has been working on a content-focused strategy at Honeyfund that will include a book and a podcast centered around the idea of how couples can successfully navigate marriages. She’s sourcing 14 years worth of Honeyfund couples to be interviewed, along with research from psychologists and marriage experts to help couples avoid the doom she went through. 

The secret weapon

Co-founder couples are the first to eagerly point out an obvious advantage. Aligned passions, equal motivation, complementary skillsets and industry experience are a baseline for any co-founder relationship, married or non-married. But being married to your co-founder includes unique challenges like time management and setting boundaries in the boardroom and in the bedroom.

“Co-founder disputes are the number one early startup killer, but it doesn’t have to be that way,” writes Garry Tan, managing partner at Initialized Capital and former Y Combinator partner.

Co-founders aren’t always aligned on big decisions at the company. Is remote work allowed? Who do we accept funding from and how do we deploy capital? Who do we hire for a key executive role?

There are plenty of things to fight about when the stakes are high and your employees’ careers are at risk. And co-founder disharmony has been a key reason many startups flounder. But being proactive about conflict management rather than avoiding it is key – as is knowing when to get professional help from an executive coach or a therapist. This could help early-stage companies recalibrate and dodge turmoil. 

If this line of reasoning holds, co-founder couples may be at an advantage because they already have built-in communication tools in their relationship.

Ulevitch says that for him, couples as co-founders is not a turn off.

“Lots of co-founding teams fall apart, and it’s often to not really knowing each other very well, especially when the going gets tough. Couples actually solve for that aspect nicely.” Founders certainly back up this assertion. 

“One of the company values is to disagree and commit,” says NEXT Trucking’s Lidia. In what she describes as a rare occasion when executives are not aligned on a decision, she says that a vote will take place, and then the team will all commit to the final decision. In order to mitigate risk, founders say it’s key to have well-defined job descriptions. Stay in your zone, and since you’re partners, you should already trust each other with what each person is specialized at. 

Being married to your co-founder is a secret weapon, according to Helena Price Hambrecht and Woody Hambrecht.

Haus co-founders Helena Price Hambrecht and Woody Hambrecht

Helena and Woody met during the pre-swipe era on OKCupid in 2012. “I had just joined the online dating space and saw this hot farmer dude. We were a 96% match, so I messaged him,” says Helena of how she first connected with her future husband. 

“I literally thought someone was catfishing me,” thought Woody upon reading Helena’s message. “There’s no way this person is writing me. It took me three or four times to write her back because I wasn’t sure if she was a real person.” 

After some back and forth, the two met at a dive bar in the San Francisco Richmond neighborhood on a date that culminated in drinking 40s and watching rap videos on their phones in the park. “It’s kind of hard to explain, but it was just so easy. We knew we were going to know each other for the rest of our lives. Maybe as friends, maybe more, we didn’t know.” They stayed friends for four years, and were married in 2018. 

Haus’ genesis was a combination of the founders’ backgrounds, and the direct-to-consumer aperitif brand just scored a $4.5 million seed round. Woody owned a wine and aperitif brand but felt that he wasn’t making a big enough impact. Helena, a Silicon Valley branding and production veteran, felt that Gen Z didn’t want to get drunk anymore, and millennials are tired of compulsory, expensive happy hours. In deciding where to put their money, younger consumers are thinking about their bodies, brand image, transparency, sustainability and authenticity.

Helena wondered why the same standards aren’t being applied to as big of an industry as liquor. Why was there not a Glossier or Everlane of alcohol? She felt that while there’s a massive opportunity with all these shifting consumer trends, no one can make a direct-to-consumer alcohol brand. Haus was born from what the founders say was a magic “techie married a wine maker” moment. Woody knew about a legal loophole that could allow the couple to build the Glossier of alcohol. 

“There’s this tiny sliver in the aperitif realm, where if a beverage is made of mostly grapes and is under 24% alcohol, it can be classed as a wine and sold DTC,” explains Helena. They had that idea when they had a three-month-old baby. “We do not have time to do this but we have to do it because it’s the best idea we’ll ever have in our life,” she says. 

“We have a tool kit. We are married. If we have a disagreement about something, we are going to work it out because we’re married. Our skillsets are so clearly defined so there’s not much friction. For us it’s this cool balance where we have two totally separate camps of expertise,” remarks Helena. 

Woody and Helena have another secret weapon. They work with a business coach who has a background in psychotherapy, and believe that all co-founders should go to therapy together, because its always deeper than just business. 

Talkspace founders Roni and Oren Frank

Talkspace’s Roni and Oren Frank would agree. Their journey to the mental health world started from a crisis within their own relationship.

“Our marriage was falling apart, and we eventually decided to give it a last chance in couples therapy.” It was the first time either of them had experienced therapy. It taught them how to communicate better, read each other and support each other better. It gave them tools to manage conflict. 

Therapy inspired Roni to leave her career as a software developer and go back to graduate school to study psychology. While studying she says she was exposed to how broken the mental health system in America is.

Roni says that research showed 25% of Americans suffer from mental health complications, yet an entire two-thirds of that bucket has no access to mental health care. The two founders both felt passionate about fixing this problem based on how instrumental therapy was in rescuing their own marriage. They decided to launch a platform that lets patients and therapists communicate online. 

Talkspace, which wants to open access to mental healthcare, has now raised $110 million, most recently a $50 million Series D. The product ideation for the company was integral to the relationship, and the company now has over 100 employees. But when Talkspace was a young, 10-person startup, it was a lot harder. Roni notes that the co-founder relationship provoked extreme anxiety.

“I didn’t sleep well, I didn’t eat well and I experienced burnout.” She says she had to force herself to place boundaries when it comes to being consumed with work. However, overall, her experience has been that sharing a mission and a goal empowers the marriage, a healthy inverse.

Co-founder couples rave about the experience of running a business with their spouse. It’s no doubt these companies are developing proprietary products, running winning marketing strategies and generating big rounds and exits.

The married co-founder dynamic appears to be great for business, but time will tell if it works as equally well for marriages.

Latin America Roundup: Loft raises $175M, Softbank invests in Mexico’s Alphacredit and Rappi pulls back

Brazil’s famously-tricky real estate market has long drawn international investors to the region in search of tech solutions. This time, Brazilian startup Loft brought in a $175M Series C from first-time investor in the region, Vulcan Capital (Paul Allen’s investment arm), alongside Andreessen Horowitz. Loft is also a16z’s first and only Brazilian investment. 

Co-founded by serial entrepreneurs and investors, Mate Pencz and Florian Hagenbuch in 2018, Loft uses a proprietary algorithm to process transaction data and provide more transparent pricing for both buyers and sellers. The startup uses two models to help clients sell properties; either Loft will value the apartment for listing on the site, or they will offer to purchase the property from the buyer immediately. Many real estate platforms in the US are shifting toward a similar iBuyer model; however, this system may be even more apt for the Latin American market, where property sales are notoriously untransparent, bureaucratic, and tedious.

Loft will use the capital to expand to Rio de Janeiro in Q1 2020 and to Mexico City in Q2, bringing on at least 100 new employees in the process. It also plans to scale its financial products to include mortgages and insurance by the end of the year. 

Alphacredit raises $125M from Softbank

Mexican consumer lending startup Alphacredit became Softbank’s new Mexico bet this month, with a $125M Series B round. Alphacredit uses a programmed deduction system to provide rapid, online loans to individuals and small businesses in Mexico. To date, the startup has granted over $1B in loans to small business clients in Mexico and Colombia, many of whom have never previously had access to financing. 

Alphacredit’s programmed deductions system enables the startup to lower default rates, which in turn lowers interest rates. For over eight years, Alphacredit has encouraged financial inclusion in Mexico and Colombia through technology; this round of investment will enable the platform to consolidate its holding as one of the top lending platforms in the region. The investment is still subject to approval by Mexico’s competition authority, COFECE, which has previously blocked startup deals such as the Cornershop acquisition in 2019. 

Softbank’s biggest bets back off in Latin America

While Softbank is still rapidly deploying its Latin America-focused Innovation Fund, some of its largest companies are stepping on the brakes. In particular, Softbank’s largest LatAm investment, Rappi, recently announced that it would lay off up to 6% of its workforce in an effort to cut costs and focus on their technology. The Colombian unicorn has been expanding at a breakneck pace throughout the region using a blitzscaling technique that has helped it reach nine countries with 5,000 employees in just two years, including Ecuador in November 2019.

Rappi has stated that it will focus on technology and UX in 2020, explaining that the job cuts do not reflect its long-term growth strategy. However, Rappi is also facing legal action for alleged intellectual property theft. Mauricio Paba, José Mendoza, and Jorge Uribe are suing Rappi CEO Simon Borrero and the company for stealing the idea for the Rappi platform while providing consulting for the three founders through his firm, Imaginamos. The case is currently being processed in Colombia and the U.S. 

One of Softbank’s biggest bets in Asia, Oyo Rooms, is facing similar challenges. Just months after announcing their expansion into Mexico, Oyo fired thousands of employees in China and India. Oyo plans to be the largest hotel chain in Mexico by the end of 2020, according to a local spokesperson.

Argentina’s Agrofy breaks regional agtech records

With a $23M Series B from SP Ventures, Fall Line Capital, and Acre Venture Partners, Argentine agricultural supply marketplace Agrofy has raised the region’s largest round for an agtech startup to date. The platform provides transparency and ease for the agricultural industry, where users can buy and everything from tractors to seeds. In four years, Agrofy has established itself as the market leader in agricultural e-commerce; it was also Fall Line Capital’s first investment outside of the U.S.

Agrofy is active in nine countries and receives over five million visits per month, 60% of which come from Brazil. However, the startup faces the challenge of low connectivity in rural areas, where most of its customers live. The investment will go to improving the platform, as well as integrating new payment types directly into the site to help clients process their transactions more smoothly. 

News and Notes: Fanatiz, Pachama, Moons, Didi, and IDB

The Miami-based sports-streaming platform, Fanatiz, raised $10M in a Series A round from 777 Partners in January 2020 after registering 125% user growth since July 2019. Founded by Chilean Matias Rivera, Fanatiz provides legal international streaming of soccer and other sports through a personalized platform so that fans can follow their teams from anywhere in the world. The startup provided the Pope with an account so that he could follow his beloved team, San Lorenzo, from the Vatican. Fanatiz has previously received investment from Magma Partners and participated in 500 Startups’ Miami Scale program.

Conservation-tech startup Pachama raised $4.1M from Silicon Valley investors to continue developing a carbon offset marketplace using drone and LIDAR data. Pachama was founded by Argentine entrepreneur Diego Saez-Gil in 2019 after he noticed the effects of deforestation in the Peruvian Amazon. After participating in Y Combinator in 2019, Pachama now has 23 sites in the US and Latin America where scientists are working alongside the startup’s technology to certify forests for carbon sequestration projects. 

Mexico’s Moons, an orthodontics startup that provides low-cost invisible aligners, has raised $5M from investors such as Jaguar Ventures, Tuesday Capital, and Foundation Capital and was recently accepted into Y Combinator, bringing the startup to the US. Moons provides a free consultation and 3D scan to patients in Mexico to determine if they are a good fit for the program, then supplies them with a yearlong invisible braces regime for around $1200. With 18 locations in Mexico and two in Colombia, Moons is expanding rapidly across the region, with ambitions for providing low-cost healthcare across several verticals in Latin America. 

Chinese ridehailing startup Didi Chuxing recently launched a sustainable fleet of over 700 electric and hybrid cars for its Mexico City operations. After two years operating in Mexico, Didi announced that it would establish its headquarters in the capital city to manage its new low-emissions fleet. The company will provide financing to help its drivers acquire and use the vehicles, in an effort to reduce Didi’s environmental impact.

The IDB Lab released a report on female entrepreneurs in Latin America, finding that 54% of female founders have raised capital and 80% plan to scale internationally in the next five years. The study, entitled “wX Insights 2020: The Rise of Women STEMpreneurs,” finds that female entrepreneurship is on the rise in Latin America, particularly in the areas of fintech, edtech, healthtech, and biotech. Nonetheless, 59% of the 1,148 women surveyed still see access to capital as the most significant limitation for their companies. However, as women take center-stage in Latin American VC, such as Antonia Rojas Eing joining ALLVP as Partner, we may see funding tilt toward female-founded firms.

This month has set 2020 on a course to continue the strong growth we saw in the Latin American ecosystem in 2019. It is always exciting to see international investors make their first bets in the region, and we expect to continue seeing new VCs entering the region over the coming year.

Antonia Rojas Eing joins ALLVP as the youngest female VC partner in Latin America

Antonia Rojas Eing, the youngest female partner of Latin America’s major VCs, has joined ALLVP as a partner. 

Twenty-nine year old Rojas Eing first entered the investment world in Germany (she is half Chilean, half German), but with a real estate angle. “I learned the discipline and analysis needed to make an investment decision, and how to see the world from an international perspective,” she noted. 

Good VCs are often founders-turned-investors. Rojas Eing has worked on the startup side as well, as she pursued an entrepreneurial project with an edtech startup a few years ago, although that company is no longer in existence. She experienced how hard it was to raise early stage capital in Chile – a problem she is back now to solve. After some time in the Bay Area pursuing a masters degree in social entrepreneurship, she returned to Chile to invest in seed stage startups with a fund called Manutara. Now, after a months of mentorship with ALLVP, she will be joining the Mexico-based fund as their third partner. 

Rojas Eing says her first focus will be on enterprise SaaS in Colombia, Mexico and Chile. “Latin America is the biggest untapped VC opportunity in the world, and ALLVP is all about transforming and improving the way Latin Americans lead daily lives.” Indeed, Latin American startups can get funding if they’re solving serious pain points for the region’s massive, digitally engaged middle class. 

ALLVP is one of the most active new wave funds in Spanish-speaking Latin America right now. The firm, which was founded in 2012, was an early backer of Cornershop, the Chilean grocery delivery startup that raised $31.7 million (mostly from Silicon Valley’s Accel) and exited to Uber after a $225 million deal with Walmart unraveled after being blocked by antitrust regulators in Mexico. ALLVP has also invested in Colombian cloud kitchen MUY and Mexican Opendoor clone Flat. The firm has over $200M in assets under management across three portfolios, having closed its third $100M fund in 2018. 

The relationship Rojas Eing and ALLVP serendipitously began at the TechCrunch Sao Paulo Battlefield event in 2018, when Rojas Eing and ALLVP general partner Fernando Lelo de Larrea judged a Startup Battlefield session together. 

Antonia Rojas Eing and Fernando Lelo de Larrea judge Startup Battlefield São Paulo in November 2018.

Toward the end of 2019, Softbank began rapidly deploying its $5 billion Latin America-focused Innovation Fund, enabling growth stage financing for companies like Brazil’s QuintoAndar, Mexico’s Konfio, and Argentina’s Uala. “Softbank is a confirmation that Latin America is going through a special moment, and it allows us to think big. Softbank has already transformed the region and will continue to do so,” says Rojas Eing.  

As the youngest female partner in this part of the globe, one can’t help asking what it’s like to compete in a male-dominated field, let alone in a region that has historically been socially and politically hostile to women.

For example, Magma Partners’ Sophia Wood points out that “married women in Chile could not purchase real estate or open a credit card without their husband’s permission until 1977, and divorce was only legalized in 2004. As recently as 2018, Chile’s ‘sociedad conyugal’ marriage law still prohibited women from managing joint financial accounts—up to 50 percent of Chileans are currently married under this law. Similar laws have restricted women’s access to credit, capital, and even education across Latin America until the recent past.”

Undoubtedly, sexist rhetoric has bled into the tech scene in regards to funding female-led companies. “Only .4 percent of the $400 billion in venture capital funding deployed between 2009 and 2017 went to Latin American women,” details the same report

“You cannot be moving with doubt,” remarks Rojas Eing. From her vantage point as a 29-year-old female partner, she feels responsibility to surface conversations about gender imbalance and inclusivity in her work. 

“Women entrepreneurs and investors represent the largest untapped pool of talent in the world. Working in a relatively young ecosystem such as Latin America provides us with the unique opportunity of creating a more inclusive entrepreneurial and VC community from the start,” says ALLVP partner Federico Antoni.  

In an industry historically dominated by toxic masculinity, sexist frameworks of thinking and extreme gender imbalance, there’s an opportunity to grow the inverse of these worldviews. Hopefully, leaders in Latin American tech will instate tactical measures to encourage positive masculinity in its rapidly expanding startup culture, and we will see more women assigned into leadership roles at startups and funds.

Perhaps as Latin America’s nascent tech revolution explodes, founders and investors can learn from Silicon Valley’s pioneering mistakes in blitzscaling, valuing profitability over growth, and startup culture that have kept women underrepresented and unsafe at work for over a decade. 

As far as ALLVP’s track record goes, partner Federico Antoni says that female founders made up 33% of their first fund, and that 20% of the companies in their second portfolio were co-founded or founded by a woman. The third fund has yet to invest in a female entrepreneur. 

Expanding the pipeline to reach more female entrepreneurs is a focus for ALLVP, and the fund says that while the ALLVP team meets with only a third of pipeline opportunities, they offer meetings with any female founder. 

More funds are diving into content marketing. Sites and blogs leverage SEO to widen the top of the funnel. Podcasts and newsletters help funds establish themselves as thought leaders and grow interest from the brightest founders. ALLVP is tapping into the content opportunity with a monthly podcast series that educates around the gender imbalance in tech too. 

Representation matters, and women fund women. ALLVP hopes that bringing Antonia on to the team will help the fund be a better partner to women. “having her on board is not a box we checked but part of a process that will ultimately lead us to a more balanced team, portfolio, and better returns.”

Assigning more women to leadership roles is certainly one step in the right direction. 

How two-year-old Loft nabbed $175M led by Andreessen Horowitz

Loft may have better product market fit in Brazil than Opendoor does in the U.S. And now the São Paulo-based property tech company has growth funding to prove it.

Andreessen Horowitz is doubling down on its first Brazil investment with Loft, a two-year-old real estate marketplace. The $175 million Series C was co-led by Vulcan Capital. 

In the U.S., sites like Opendoor give us visibility into how much your house or properties you’re interested in are worth. That transparency doesn’t exist in Latin America. 

Loft founder and co-CEO Mate Pencz describes the residential real estate market in Latin America as a $6 trillion opportunity. As it exists now, lack of data transparency around property listings results in low-quality listings, disproportionately high asking prices and prolonged selling times. This creates a painful experience for buyers, sellers and brokers. The market is locked up, but Loft thinks it can create transparency and liquidity with open data sets for property value. 

Loft has been supported by some pretty big Silicon Valley names since its genesis in 2018. Loft raised equity capital from angel investors such as Max Levchin of PayPal, Joe Lonsdale of Palantir, Opendoor founder Eric Wu, Mike Krieger of Instagram, David Vélez of Nubank and Josh Kushner of Thrive Capital, whom Pencz met during undergrad studies at Harvard. It helped that Loft was not Pencz’s first entrepreneurial rodeo — the founder started web-printing company Printi, which exited to Vistaprint in 2014 for a $25 million stake. 

Growth-stage funding will enable Loft to scale

Pencz says they’ve transacted on 1,000 properties in their key market of São Paulo, and plans to tackle new cities with the “Uber growth model” of replicating the same service in new cities, like Mexico City. Loft is currently operative in Brazil, and has big plans for Mexico in 2020. Penzc has poached the Latin American head of Uber Eats, Juan Pablo Ramos, to launch Loft’s services in Mexico City within the next two to four months. As Loft mobilizes in Mexico, this could mean trouble for Flat, an existing Opendoor clone in Mexico, which will now fight for market share against a heavily funded competitor. 

Loft’s São Paulo HQ

When it comes to marketing, Loft isn’t thinking about Facebook or SEO performance advertising. Pencz sees more value in physically integrating the Loft brand into the fabric of new neighborhoods through festival sponsorships and community events, while leveraging broker channels. “Partnering with brokers and being perceived as a positive brand with a high NPS are the two key pillars of Loft’s expansion strategy,” says Pencz. 

The founders began by physically measuring buildings and making estimates about how much houses and apartments were worth. The founders didn’t stop there — they envision the future of Loft as a one-stop shop with services like renovations, property financing for mortgages and insurance through banks. The company wants to completely upend real estate in Latin America, and those big ambitions have piqued investor interest. 

Andreessen Horowitz and Vulcan Capital co-led the Series C, with participation from QED Investors, Fifth Wall Ventures, Thrive Capital, Valor Capital and Monashees. What is a16z’s Latin America strategy?

Andreessen Horowitz general partner Alex Rampell notes that while Loft marked the firm’s entry into Brazil, the fund has been active in Latin America for a few years: a16z invested in Colombia’s delivery unicorn Rappi, Uruguayan restaurant management platform Meitre and Colombian point of sale lender ADDI. And, a16z joined in Loft’s $70 million Series B that closed in March 2019.

Rampell, who previously invested in Opendoor and sits on the board of TransferWise, says that a16z doesn’t really have an investment strategy when it comes to Latin America. Instead, the idea with Loft was that while the iBuyer Opendoor for transactional multiple listing services isn’t by any means a proprietary business model, it may work better in a country like Brazil — where buyers and sellers are slowed down by bureaucratic policies and lack of fair market value data — than in the U.S. To put it simply, Loft has better product market fit in Brazil than Opendoor does in the U.S. 

Loft hopes its customer-friendly Nubank-esque branding will win over new users 

Rampell references the U.S.’s Groupon and Korea’s Coupang for comparison. The Groupon model blew up in Asia as Coupang’s valuation reached $9 billion. Groupon rose fast and fell hard, and now its founders are on to their next entrepreneurial ventures

“There’s a lot of value in multiple listings services, and the opportunity might be better for a market like Brazil, especially if you back the right entrepreneurs — because that’s all that really matters in the end,” says Rampell. This new model that opened or pioneered at the iBuyer model is going to pop up all around the world. So VCs are figuring out the best pockets of the world for different business models, and finding the best entrepreneurs to lead these companies. The thesis for Loft’s growth funding is that Brazil is underserved on this particular macro trend. 

Loft monetizes through the sale of properties and ancillary products. Cuts from referral and partnership fees from banks or insurance companies will continue to help Loft monetize, in addition to the $275 million in capital it has raised during its two short years in existence. 

Pencz declined to comment on Loft’s valuation.

Latin America Roundup: XP’s chart-topping IPO, Wildlife becomes a unicorn, Softbank backs Konfio

December has been a strong month for Brazilian startups, bringing a big IPO and a new unicorn for local companies. Tech-driven investment firm XP Investimentos went public on the US Stock Exchange in mid-December raising $1.81B in the fourth-largest IPO of 2019. XP’s stock price jumped 30% on its first day of trading from $27 per share to $34.50. 

XP was founded in 2001 to provide brokerage training classes to Brazilians to help them invest in the international stock market. Today, it is a full-service brokerage firm, providing fund management and distribution to over 1.5 million customers in Brazil. 

Notably, XP has outlined a strategy for beating Brazilian banks, among the most profitable in the world, in its 354-page report to the SEC. Brazil’s banking market is highly concentrated, with the top five players dominating 93% of market share. This concentration has led to significant inefficiencies that XP tries to disrupt by offering a variety of financial products through an accessible online platform. 

The heavy bureaucracy of these banks will prevent them from innovating quickly enough to compete with newer institutions like XP, whose debt products are attractive to frustrated Brazilian customers. The inefficiency of the Brazilian financial system has opened opportunities for companies like XP, or neobank Nubank, to rapidly attract customers who are disgruntled with the traditional system. 

Gaming startup Wildlife becomes a unicorn

Brazil has seen a new unicorn emerge almost every month this year, and December was no exception. Gaming startup Wildlife raised a $60M Series A round led by US-investor Benchmark Capital at a $1.3B valuation to become the country’s eleventh unicorn. This round was big even for Silicon Valley standards, and it is uncommon for startups even in markets like the US or Europe to hit a $1B+ valuation in such an early round. 

Wildlife has created over 60 games since 2011, including Zooba and Tennis Clash, which have both reached global acclaim. Founded by brothers Victor and Arthur Lazarte, Wildlife operates on a freemium model that only charges users for in-app purchases. They plan to use the funding to double their employee base and grow to $2B in 2020, continuing the 80% yearly growth they have seen since 2011. 

Mexico’s lender Konfio receives $100M from Softbank

Konfio provides small business loans in Mexico through an online platform to help SMEs gain liquidity and grow their operations. These small businesses are often overlooked by banks in Mexico and Latin America who do not know how to price risk for businesses that process under $10M per year. 

Konfio recently raised $100M from Softbank’s Innovation Fund, the third investment that Softbank has made into Mexico since launching the fund. The capital will go toward financing working capital loans, as well as creating new products for Konfio’s customers. Today, Konfio’s loans average at around $12,000, while banks still struggle to loan under $40,000. The tech-driven platform allows Konfio to disburse loans within 24 hours without requiring collateral.

Small business lending is a tremendous opportunity in Latin America, where banks are among the most profitable and the least competitive in the world. Brazil’s Creditas and Colombia’s OmniBnk are among the other startups who are providing innovative products that calculate risk more effectively than banks in Latin America’s complex lending environment.

 

The Albo team has raised $26.4 million to scale its leading neobank.

Albo, Mexico’s leading neobank, raises $19M

In an extension of a Series A round, Mexico’s albo raised a further $19M from Valar Ventures to bring their newest round to $26.4M in total. Albo previously raised $7.4M from Mountain Nazca, Omidyar Network, and Greyhound Capital in January 2019. Albo’s mission is to provide banking services to unbanked and underbanked clients in Mexico. Over half of albo’s customers claim that albo was their first-ever bank account. 

Founded by Angel Sahagun in 2016, albo quickly became Mexico’s largest neobank, serving over 200,000 customers and sending out thousands of new cards every day. The investment from Valar Ventures, founded by Peter Thiel (also an investor in N26 and Transferwise), is a vote of confidence for this Mexican fintech. Albo has also previously received investment from Arkfund, Magma Partners, and Mexican angels. 

Albo plans to use the capital to develop new products, including savings and credit services, in the coming year. Mexico will likely be a battleground for Latin American neobanks in 2020, as Klar, Nubank, and potentially Argentina’s Uala, will begin to grow in the region’s second-largest market. While there is room for several competitive neobanks to thrive in Mexico, this industry will be one to watch in 2020.

News and Notes: Mercado Credito, Mimic, Rebel, and Rappi

Goldman Sachs loaned $125M to MercadoLibre to continue developing their credit product, MercadoCredito. MercadoLibre will use the capital to triple its $100M debt facility for small business loans in Mexico. To date, MercadoCredito has loaned over $610M to 270,000 businesses around the region in Mexico, Brazil, and Argentina. 

Brazilian cloud-kitchen startup Mimic raised $9M in a seed round led by Monashees to develop a more efficient food delivery model in Brazil. Mimic will exclusively manage the logistics of “dark kitchens,” which exist only for delivery and have no sit-down facilities, saving time and money for clients. Mimic will use the investment to grow its team.

An early-stage online lending startup in Brazil, Rebel, recently raised $10M from Monashees and Fintech Collective to provide unsecured loans to middle-class Brazilians at affordable rates. Rebel has lowered rates to around 2.9% per month, compared to 40-400% at Brazil’s largest banks. The startup uses a proprietary algorithm to calculate risk for clients and provide loans rapidly through its online platform. 

Colombia’s Rappi recently announced an expansion into Ecuador, where it has rapidly reached 100,000 users between Quito and Guayaquil, the country’s two largest cities. Rappi is now active in nine countries and over 50 cities in Latin America. 

2019: A Year in Review

Given the arrival of the Softbank Innovation Fund, Latin American startup investment in 2019 will likely more than double the $2B invested in 2018. Here are a few of the highlights we saw this year:

  1. Record-breaking rounds and Brazilian unicorns: In 2019, Rappi raised $1B from Softbank, beating iFood’s previous record-breaking $500M from Naspers in 2018. Brazil got at least six new unicorns – Nubank, QuintoAndar, Gympass, Wildlife, Loggi, and EBANX – most of whom raised funding from international investors. 
  2. Asian investment in Latin American fintechs: Nubank received $400M+ in 2019 from investors that included TCV, Tencent, Sequoia, Dragoneer, and Ribbit Capital. Argentina’s Uala received $150M from Softbank and Tencent in November 2019. Softbank has been investing in Brazilian and Mexican fintechs including Creditas, Konfio, and Clip, throughout the year. 
  3. US investors take an interest in LatAm: Many US investors made their first Latin American investments in 2019 including Valar Ventures (albo), Bezos Expeditions (NotCo), SixThirty Cyber (Kriptos), and Homebrew (Habi). This year has also seen large funds like a16z, Sequoia, Accel, and others making earlier stage investments in Latin America, rather than Series B and beyond. This change demonstrates that US funds are becoming more familiar and involved with the Latin American ecosystem, helping early-stage companies grow rather than focusing on international scale-ups as they have in the past.
  4. The Cornershop acquisition: Chilean-Mexican delivery startup, Cornershop, was acquired by Walmart in late 2018 for $225M, but the deal was blocked by the Mexican government. Four months after the block, Cornershop announced that Uber would take a 51% share of the company for $450M, representing a 4x growth in valuation since the previous acquisition deal. The Mexican and Chilean governments still have to approve the Uber deal, so all eyes will be on Cornershop through the start of 2020. 
  5. The start of the battle for Latin America’s super-app: In China, two companies dominate the mobile market, handling payments, communications, ridesharing, delivery, and more within a single app. Events in 2019, such as Rappi’s $1B round and the merger between Mexico’s Grin and Brazil’s Yellow, suggest that Latin America may be heading in the same direction toward a few apps that integrate dozens of features. Colombia’s Rappi and Brazil’s Movile are strong competitors for the role, but the rise of a regional super-app still remains far in the future for Latin America.

Latin America’s startup and investment ecosystem has likely more than doubled this year as compared to 2019. As international investors like Softbank, Andreesen Horowitz, Sequoia, Accel, Tencent, and others are taking more bets on the region, more startups than ever have scaled and reached unicorn status. These startups will continue to scale in 2020, taking on a regional presence to provide services to Latin America’s 650M population.