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| The LAVCA Private Capital Update is a bi-weekly email featuring industry news, research, events, and updates on investors from private equity, venture capital, real estate, infrastructure, and family offices in Latin America.
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Thank you to the 900+ participants who joined the recent LatAm VC/Tech: Update On Data & Trends virtual discussion with Silicon Valley Bank on May 5, 2020, and to our esteemed panelists:
Francisco Alvarez-Demalde, Riverwood Capital‘s Co-Founder & Managing Partner;
Julio Vasconcellos, Founding Partner of Canary and Managing Partner of Atlantico;
Andy Tsao, SVB‘s Managing Director;
Susana Garcia-Robles, LAVCA's Executive Advisor
Facilitated by Julia Figueiredo, SVB's Director of LatAm, the meeting kicked off with data insights from Julie Ruvolo, LAVCA's Director of Venture Capital.
Listen to the full recording here.
NOW AVAILABLE FOR DOWNLOAD: LAVCA's Annual VC/Tech Report: Inside The 4th Consecutive Peak Year cites 2019 VC investment data, highlighted transactions, and sector and country trends.
2019 proved to be a record breaking year for Latin America venture capital on many fronts:
• VC FUNDRAISING (in dollar terms) totaled US$1.08b in partial and final fund closes;
• VC INVESTMENT (in dollar terms) for the region rose to US$4.6b;
• MEGA-ROUNDS 18 disclosed transactions over US$50m; 11 transactions over US$100m;
• SEED/INCUBATOR transactions reported a record year in Argentina, Colombia, and Mexico.
Venture investment in Latin America has more than doubled every year from 2016 to 2019, tracing a steady growth trajectory that will certainly be interrupted by the 2020 COVID-19 global health pandemic in ways foreseen and unforeseen.
The resilience and resourcefulness of Latin America’s entrepreneurs will be tested in the year ahead as the need for cost-effective solutions to highly complex problems comes into sharper view.
DOWNLOAD LAVCA’s Annual VC/Tech Report.
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LAVCA continues to gather relevant resources and updates for private capital investors active in Latin America in light of how the spread of COVID-19 might affect portfolio companies, investor relations, pipeline building, and more.
This week, insights from LAVCA member firms in Latin America include:
• Riverwood Capital joined forces with players in the region to support "Conectados", a relief initiative for portfolio companies in Latin America utilizing a tech platform to help healthcare workers access discounts and benefits, and to facilitate donations to the Red Cross for employees of participating companies, with a match from their employer.
• Advent International's Advent Global Relief Fund (AGRF) channels resources to local organizations that are leading the fight against COVID-19 to support the healthcare system response to the crisis, and vulnerable populations affected by the economic slowdown.
• SoftBank shared insights with LAVCA on the "Alibaba Effect" in Latin America. The statement, based on a communication to their stakeholders, compares the current crisis with the resiliency of the Chinese giant during the 2003 SARS pandemic when technology innovation and adaptability led to the launch of new companies. SoftBank also shared the fund's updated investment outlook.
• AC Ventures shared a review of the current state of the global startup ecosystem and sheds light into challenges that both founders and investors will have to face moving forward.
• ALLVP shared a statement on the fund’s view on the gradual recovery of social and economic activity in Latin America and a reframed sub-sector focus adapted to the new reality after the COVID-19 crisis.
Access additional resources on our website here.
Have relevant information you would like to share? Please email editor@lavca.org.
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The sudden and wide-ranging impact of COVID-19 has resulted in companies facing unprecedented circumstances and challenges. Portfolio companies backed by private equity are no exception and the pressure on such firms and their boards of directors to respond to the crisis is high.
While the nature of a director’s fiduciary duties in Latin America has not changed as a result of COVID-19, Thais Garcia, Partner at Clifford Chance, outlines some best practices for private equity appointed directors to comply with their fiduciary duties that align with helping their portfolio companies navigate this challenging environment.
Directors should be aware of any specific regulations that may apply to the company, for example, to publicly held companies or companies in regulated sectors such as financial services, telecommunication, infrastructure, energy, pharmaceuticals, and insurance. There may be a need to involve regulators in decisions or to keep them informed and consulted.
A recent example of the benefits of early engagement with regulators was seen in the utilities sector in Chile. Due to the major business disruptions caused by the COVID-19 pandemic, public opinion put pressure on both Chilean utilities companies and the government to provide relief to households in connection with the payment of utility bills. Rather than waiting for the enactment of potentially more stringent and onerous regulation by the Chilean Parliament, utility companies decided to engage in discussions with the government to reach an agreement on a relief plan, which was ultimately successful.
READ the article here.
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