LatAm Venture Bulletin May 10, 2017

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LatAm Venture Bulletin

> Rakuten, Seaya Ventures, and AngelList made a US$100m follow-on investment in Spanish ride-hailing app Cabify. Cabify competes with 99, Easy, and Uber in Latin America.

> Accel led a US$21m Series B in Cornershop to expand into new Mexican cities, with participation from previous investors ALLVP, Jackson Square Ventures, and Creandum.

> Fiinlab, an innovation lab owned by Mexican financial inclusion group Gentera, has made a Series A in Aflore, a Polymath Ventures portfolio company and financial services startup based in Colombia. 

> SP Ventures continues to target agtech with a R$3m investment in Horus Aeronaves, a drone startup specializing in agriculture, and an undisclosed investment in Aegro, a software platform for grain cultivation with a team from UFRGS and IRGA.

> Axon Partners made an undisclosed investment in Boxi, a Colombian mattress e-commerce startup.

> Blockchain technology investor Medici Ventures made an undisclosed investment in Argentinian bitcoin platform Ripio, which has over 70k users across Argentina and Brazil and is in the process of expanding to Mexico and Colombia.

> Y Combinator’s latest batch includes two Latin American startups, Mexican book review platform, run by Pamela Valdes, and Hogaru, a Colombia office services platform accelerated by Wayra, the accelerator of Telefonica Open Future_. Each startup received US$120k in exchange for a 7% equity stake.


> Mexico’s Dux Capital had a US$15m first close on its new venture fund. Dux is looking to write checks from US$50k to US$2m in Mexico’s IT, consumer, retail, and energy sectors.

>, a Brazilian investment fund created by Peixe Urbano Founder Julio Vasconcellos and four other partners, raised US$20m of its US$50m goal and has already invested in three startups: Rapidoo, Volanty, and IDWall.

> Brazilian accelerator ACE joined the Draper Venture Network Beta. Dalus Capital in Mexico is also a member of the Draper Venture Network.


> Brazilian investment broker XP Investimentos expects to IPO in August, 2017. XP founder Guilherme Benchimol together with a group of partners hold a 51% stake; General Atlantic holds a 49% stake.


> US fund Wired Investor acquired SocialTools, an Argentina-based social media management platform for an undisclosed amount. Investors in SocialTools include Wayra, the accelerator of Telefonica Open Future_, and 500 Startups.



> LGT Impact Ventures invested ~US$21m in General Water, a Brazilian on-site water and sanitation systems company catered to small and mid-sized businesses in São Paulo, Brazil.

> Impact investing firm Capria’s fourth investment cycle is open. Interested impact firms can apply by May 19. Colombian fund manager Odiseo and Brazilian fund manager Performa Investimentos recently joined Capria’s network of impact investment funds.

> TPG Growth’s new US$1b impact fund, Rise, made its debut investment in American edtech startup EverFi. Rise contributed US$120m towards the US$190m Series D. TPG Growth also invested R$62m in Brazil's Resultados Digitais in 2016. TPG Growth’s second deal through Rise is a US$50m investment in Dodla Dairy, a company working with 250k smallholder farms across 7k villages in southern India.



> Ley Projoven, a new law in Colombia, aims to ease new company creation for entrepreneurs under 35 years old, and promote the formalization of small businesses.

> Mexico is in the process of passing Ley de FinTech to regulate the sector, after the country came out on “top in the fintech space in 2016” with four companies (Kubo Financierio, Clip, Kueski, and Konfío) “capturing a third” of all investments in the Mexican ecosystem.

> Tech companies in Brazil are celebrating the approval of Projeto de Lei, a new law that allows companies to outsource core business functions.

> The Brazilian House of Representatives (Câmara dos Deputados) will vote on whether or not to impose federal regulation on Uber.

> Read more tech policy updates on



> Jackie Hyland at SVB digs into the agtech opportunity in LatAm:

"Latin America is an overall net food exporter and represents 13% of all agricultural trade. It holds 23% of arable land (second to Sub-Saharan Africa), 31% of water, and 23% of the globe's forests. It accounts for 50% of soybean production, 44% of beef exports, and 42% of chicken exports. Brazil is Latin America's leader as the second largest food exporter in the world (just behind the United States) and as the largest producer and exporter of sugar, coffee, and orange juice. It is also the second largest producer and exporter of soybeans, beef, and poultry. Following Brazil is Argentina, with total agricultural exports having averaged US$42b per year over the last three years."        

> TechCrunch: There were US$31b in acquisitions by the largest agriculture companies between 2008 and 2015.

> wearesocial: Brazil has the third highest number of Facebook users in the world—behind the US and India. Facebook VP Diego Dzodan told LAVCA that Mexico is #4 in terms of monthly active users.

> FastCo: Goldman Sachs estimates that equity crowdfunding can be a US$1.2t opportunity–that’s more than payments, small business lending, and consumer lending together.

> FastCo says remittance payments are a US$440b (not a typo) global business ripe for disruption:

"2.5 billion people lack access to basic financial tools, like bank accounts. At least 60% of Mexicans don't have checking account services.... The blockchain could reduce the cost of sending "remittances" from people living in rich countries to relatives who live in poorer ones..... And yet, they currently come with high transaction costs. For example, to send $100 in cash from the US to India using Western Union incurs $11 in fees."

> Reuters: US VC firm Blockchain Capital raised US$10m in six hours selling its digital tokens to investors.

> Fortune: Only 1% of female founders have used VC money to fund their business.



> El Financiero: México supera a Brasil en tratos de capital de riesgo.

> Americas Quarterly has a special issue called “Indivisible” dedicated to the Mexico/US relationship. Check it out here.

> FT: Buenos Aires wants to persuade investors the past is behind it.

> Epoca Negocios covers new Braziilan fund Criador do Peixe Urbano lidera fundo de investimento.

> Valor Econômico says Brazilian mega-salon Beleza Natural, which raised R$70m from GP Investimentos in 2013, is opening its first store in New York. Beleza Natural bootstrapped 100% of its business until receiving growth capital from GP Investimentos. Founder Leila Velez was selected as and Endeavor entrepreneur in 2005.

> The Guardian: Facebook publicly acknowledged its platform has been exploited by governments seeking to manipulate public opinion in other countries – including during the presidential elections in the US and France – and pledged to clamp down on such “information operations”. Facebook does not deny Russian involvement.

> Poynter: Fact-checking is booming in Brazil, and Google is expanding its fact-check label —launched in the wake of the US election—to Mexico, Brazil, and Argentina.

> Like Brazil’s WhatsApp blackouts but worse: India has blocked social media sites for an entire month in a legally unprecedented move the government says is in the interest of “public order.” This is after videos and photos of Indian security forces abusing Kashmiris sparked anti-government protests.



> Yesterday, 45+ Brazilian fund managers gathered for VC in São Paulo, a private investor meeting held bi-annually by LAVCA. Invited private equity firms joined the discussion on the convergence of fintech opportunities across stages and LAVCA members participated in a PE/VC dinner to facilitate introductions between leading investors in the local ecosystem.

> LAVCA interviews Peruvian entrepreneurs Domingo Seminario, Founder of Joinnus, and TuRuta Co-Founders Isaac Malca and Jean-Pierre Carrere at Wayra Peru, the accelerator of Telefonica Open Future_. Related: Check out this guide to Peruvian startups the Peruvian Angel Investors Association just published.

> Startup Bootcamp FinTech, in partnership with Finnovista, is holding its first fintech bootcamp in Mexico city this July-October. Apply by May 21.

> Harvard Business School recognized Apli, a Mexican startup connecting companies to future employees, with a US$75k prize.

> Carrefour’s Desafio de Startups is looking for innovators in foodtech.

> IE Business School is hosting Fintech Venture Day on May 25 in Mexico City. Details here.

> The Perú Venture Capital Conference organized by UTEC, BID, FOMIN, and COFIDE is scheduled for June 13-14 in Lima, Peru. Register here.

> 500 Startups and the Stanford Center for Professional Development are teaming up to host #VCUnlocked: Secrets of Silicon Valley Investing, a 2-week crash course for investors, from July 24th – August 4th, 2017 in Palo Alto. Apply to attend here.

> Nieman Lab, a project of Harvard University, is expanding its international coverage through a grant from Open Society Foundations and is looking for stories of digital innovation in journalism outside the US. Send them your ideas.



> Growth market insights from Niels Bormans at The Abraaj Group: The New Champions: How Local Players Are Dominating Growth Markets.

> What does Day 2 look like? Excellent perspective from Amazon chief Jeff Bezos on how to scale a company and avoid irrelevance by perpetually operating in “Day 1.”

> How big should my portfolio be? Matt Lerner at 500 Startups:

"If you’re investing at seed stage, and you are an average investor (in terms of deal flow & selection experience), and your main goal is maximizing financial returns, you’d want a minimum of 100 companies to get a decent shot at a 3X gross return."

> Bloomberg: Rich Families Go Solo on Deals, Moving Away From Private Equity.



> Sam Altman of Y Combinator and others drafted a Tech Pledge expressing commitments to keep user data private and support legal immigration by providing legal assistance and paying costs for YC immigrant employees facing challenges with the changing immigration system.

> Axios on how Trump's H-1B visa reforms may hurt startups: Foreign-born founders will have a harder time getting visas to start companies in the US; startups will head to other countries instead; Investors will also go abroad; Raising the salary requirements will hurt startups more than big tech firms.

> Axios also interviews Box CEO Aaron Levie, who fears that the H-1B changes will stifle American innovation:

"We're taking it for granted that we're such a great environment, that people want to come here....The moment that goes away, we don't win in tech anymore. We don't have the volume of talent that other countries do, so if you're not the best place for immigrants then you don't win in the digital economy. That's the really scary thing.

> Vanity Fair: Silicon Valley Murder Mystery: How Drugs and Paranoia Doomed Silk Road.



> David Weinberger on what it means when our machines know more than us: Knowing the world may require giving up on understanding it.” #LONGREAD


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