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What happened in Latin American tech in 2019

Bogota, Colombia

As I write this post, I could easily feel dismayed watching the world on the edge of a precipice. The president of the United States will be impeached this week for allegedly attempting to bribe the Ukrainian government while pro-democracy protesters wave the 50 stars flag on the streets of Hong Kong. The UK is about to decide if their islands are kept attached to the European continent or drift apart towards the empty ocean. On the other side of the Channel, thousands of gilets jaunes are waiting patiently for the next big wave of protests somewhere in a warehouse in the outskirts of Paris. In the last few weeks, students have protested in Jakarta, farmers in the Netherlands, civil activists in Beirut and Teheran.


In Latin America, in the past few weeks, historic peaceful protests were drowned by violent riots in Santiago, Lima, and Bogota. In Brazil, the newly elected right-wing president is pushing economic growth at all costs letting capitalism destroy the largest reserve of oxygen in the world. Meanwhile, the ousted Bolivian president in exile is plotting a comeback. Up north, a Mexican populist leader wrecks its countries’ institutions and loses ground to emboldened narco cartels in the name of love and equality.



This text is not about all that. Maybe it should be. Maybe every text should be about how we save our planet and fix our broken societies. Can’t decide.

This post is about a tech industry that every year feels more like a bubble not because valuations have gone sky-high but because our world is upside down. One where anyone could easily feel hopeless yet I’m convinced entrepreneurship and entrepreneurial innovation will contribute to a new better world. Founders keep me optimistic.

Having said all that, here’s what you clicked for.


What happened in Latin American tech in 2019? In one word: Softbank. The Japanese conglomerate announced a $5B new Latin American fund in February and started deploying capital before the Techcrunch post covering the news stopped getting likes and shares by an enthusiastic Latin American ecosystem.


Softbank’s multi-year commitment amounted to more than twice the venture capital deployed by the whole sector in 2018. Softbank started with large investments in logistics and fintech. For once, all of the media’s hype was justified. Softbank’s impact in the region has been enormous.

The gamble of Marcelo Claure, Softbank’s Bolivian star executive, couldn’t have come in better timing. The region was gaining momentum. Brazil’s ecosystem had already produced two massive $1B+ exits with Stone and 99. Startups in Colombia, Mexico, Argentina, and Chile had closed unprecedented mega-rounds lead by premier growth funds such as GA, GVV & DST advancing decisively to the region. More upstream and following Rappi’s success, YC doubled its investment pace attracting some of the most talented Latin American teams.

More than the dollars, Softbank pushed a region that had already started to dream big to uncover its true potential. The message: massive companies can and will be built in Latin America. Grin, the Mexican Scooter company had connected the dots for us all a year earlier:from YC to $70M+ round in less than a year, expanding from Mexico City to Brazil and beyond while closing seven M&A deals to move faster. This confidence and clear signals caught the attention of firms such as Sequoia, a16z, Global Founders Capital and, Foundation who started leading early-stage rounds. This, in turn, has attracted more talent to the region from all corners of the world. It’s exciting!


Notwithstanding the great news, this huge and unpredicted inflow of capital can send the wrong message. Latin Americans may want to import the capital-as-a-weapon narrative. If you raise enough money you can basically win any market, make any unit economic work, and bring any competitor down. When acquisition channels are basically commodities and product differentiation is hard, money seems like a huge advantage. Well, it’s not. Ingenuity, resourcefulness, and heart and grit will ultimately prevail.


Yes, I expected 2019 would be long and confusing but also that Latin American tech would have a chance to thrive. It did but in different ways than I predicted.


I thought the Chilean ecosystem would take off but instead, it was Colombia, and in a big way. The talented operators coming from local juggernauts PayU, Domicilios (DeliveryHero) and Rappi started building tech companies faster than in any other country.

It was a historic year for the Brazilian VC. Backed by Softbank, Kaszek and Valor raised record-breaking amounts if capital with four new funds. Four! It took Monashess, Latin America’s pioneer only a few weeks to close fresh $280M. Elsewhere, first-time funds from early-stage VCs brought a new and refreshing perspective to early-stage investing. It was fascinating to watch firms like Maya, Latitud4, Magma Ventures, Redwood, Venture City, Animo Ventures, and, OneVC start investing.


Nearly $2B of regional VC dry powder will be chasing great tech founders.

Fintech continued to dominate the conversation and capital allocation. I predicted the wallet wave in Mexico would start to slow down. It did everything but. Uala, Klar, Fondeadora, and Weex Wallet (now Mibo), and many other new players proved me wrong. I also expected banks to make a big move in fintech. Instead, Uber, Facebook & MercadoLibre launched new initiatives to get a piece of the fintech opportunity. Just wondering: how can board members of large financial institutions keep their jobs?


I was somewhat correct when predicting Brazilian tech companies would expand to Mexico this year. We are still waiting for most to move from the press release to the hands of consumers. While the track record for these expansions is abysmally bad, a new generation of tech industry leaders seems better equipped and has more capital than ever before. Maybe Nubank, a rocketship led by a Colombian entrepreneur, will break the losing streak for Brazilian companies.


And what about that last prediction apropos the macro slowdown around the corner?

Well, it’s still around the corner. If I run out of ideas, I may make that same prediction over and over again until I’m right 😉

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I write about my work as an investor, a lecturer, and a mentor. In general, musings about Latin American tech, VC and life.

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