Latin American startups are having a moment and what we crave and seek now is growth and consolidation.

Here is a recap of what Venture Capital activity in LatAm looked like during September:

  • More than 80 funding rounds
  • Around $1.7B invested in LatAm startups
  • 1 new Mexican Unicorn.
  • Kavak doubled its valuation
  • Memo Ochoa meets the startup ecosystem once again

Mexican Startups Received Most Funds

Kavak’s Series E funding round worth $700M launched Mexico to top the list of total funding by country. General Catalyst led the round. 

There were around $1.7B raised for all Latin American startups, out of which almost $1.2B  were destined to Mexico.

We’re used to seeing Brazil lead this list, or at least be close to the top 1 country. But this month, there was a clear difference and Mexico rose to the top in terms of capital raised.

Not surprisingly, Brazil did lead the number of funding rounds raised during the past month. This difference can be explained by the focus placed on seed and early-stage ventures. These 52 funding rounds translate into more than 60% of the total number of rounds coming from Brazilian startups. 

In comparing these two graphs, we can see that the average ticket size for Brazilian ventures was around $6.7M. This amount belongs to a range usually seen in early-stage startups. In the meantime, the average ticket for Mexico was around $100M which indicates that these investments were destined to a more developed market. 

Biggest Rounds 

From the $1.2B invested in Mexican startups, around 85% of it was invested in 3 of the biggest rounds during September. 40% of the total funding during September in Latin America belongs to Kavak’s Series E. 

Merama, which is a brand-building company, seconds the list. Merama’s latest funding round is the largest Series B raised from a Latin American startup ever seen.

Mexico leads this list with 3 out of 5 startups in it. SoftBank is curiously involved in all 3 Mexican funding rounds.

*Mexican-Brazilian startup, Merama, was listed as Mexican for this recap.

The Unicorn Club

Mexican digital banking platform for small and middle-sized companies, Konfío, is the latest company joining the unicorn club. 

Konfío raised a $110M Series E and reached a $1.3B valuation. Tarsadia Capital and QED Investors led the round.

Before 2021, Mexico had no tech startups with a unicorn status. Konfío is now the fourth (!) Mexican unicorn following Kavak, Bitso, and Clip.

Kavak, the first of the four, raised a $700M Series E round just 5 months after its latest funding round. By this time period, Kavak more than doubled its valuation, going from $4B to $8.7B – making them the second most valuable startup in all of LatAm.

Top Invested Industries

Unsurprisingly, finance and enterprise services remain as two of the most funded industries in Latin America. Kavak’s round launched the automotive industry as the most funded one during September.

In the finance sector, most of the funding went to payments and credit. While there was a significant portion going towards investing and banking solutions.

For the enterprise box, the funding went mostly to management, sales, e-commerce, and professional services tools. 

Unlike August, the pet industry was the only one that left the top-funded square map (in reference to the graph below) this month. The automotive sector took its place instead.

Startups are Growth

During September, 75% of the funding rounds belonged to early-stage startups.

59 of the 79 rounds were between the Angel and a Series B funding type.

Just 3 of them were late-stage; 1 Series C and 2 Series E.

The rest of them had an undisclosed funding type.

*Grants, Crowdfunding, and Debt were omitted for these charts.

Soccer and Startup Crossover

Mexico’s national team goalkeeper, Guillermo Ochoa, joined the startup ecosystem a couple of months ago when he invested in Mexico’s first unicorn: Kavak.

Ochoa reappeared in the ecosystem, with an investment of $1M, and became the main partner in Altered Ventures.

Altered Ventures is a San Francisco-based early-stage VC fund focused on video game development, and VR/AR solutions.

The Mexican National Soccer Team goalkeeper and captain, committed to only invest in Latin American entrepreneurs, esports talent, NFT, and games; as mentioned in their press release.

Stay updated with the latest startup, venture capital, and tech news in Latin America.

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