LatAm Venture Bulletin October 4, 2017

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LatAm Venture Bulletin

> Startups in Mexico City rose to the crisis on September 19 when a devastating earthquake struck. We’ve heard a number of stories last week from investors based in Mexico City about entrepreneurs and teams who dropped what they were doing to help out how they could.

> Consider donating to Bitso’s relief fund (for BTC, ETH, or XRP), which will split donations 50/50 between the Red Cross and the Topos earthquake rescue brigade, or directly to Topos (for USD, MXN) on PayPal at #FUERZAMEXICO

> Social entrepreneur Isabel Rullán of rose to the hurricane crisis in Puerto Rico. She started a crowdfunding campaign to provide direct aid to Puerto Ricans, having raised over US$1.2m. Consider donating to Rullán’s campaign at

> We also came across a story of a 15-year-old Puerto Rican named Salvador Gabriel Gómez Colón who is halfway to his goal of raising US$100k to buy solar-powered lights and hand-crank washing machines.


> Billionaire George Soros made an undisclosed investment in Argentina's mobile bank Ualá. Participants in the round include US firms Point72 Ventures and Bessemer Venture Partners.

> A group of American, British, Colombian, Mexican, and Peruvian investors made a US$525k Series A investment in Polymath Ventures’ Autolab, an autoshop startup based in Colombia.

> KaszeK Ventures led a R$5m investment in Liv Up, a Brazilian frozen food delivery company. iFood founder Patrick Sigrist and Rapiddo CEO Guilherme Bonifácio invested previously.

> BR Startups invested R$1m in Tbit, a Brazilian agtech imaging startup. BR Startups is managed by MSW Capital; LPs include Monsanto, Qualcomm, Algar, Microsoft Participações Brazil, and others.

> #PRIVATEEQUITY: Fundo Aeroespacial, a R$131m fund launched by BNDES in 2014 to invest in aeronautics and defense, made an undisclosed investment in Aquarela, a Florianopolis, Brazil-based big data company that was incubated at MIDI Tecnológico.

> #PRIVATEEQUITY: Accel-KKR made an undisclosed investment in Siigo, a Colombian enterprise software startup for SMEs. This is Accel-KKR’s first investment in Latin America.



> Soldiers Field Angels I fund (SFA) exited its investment in Now New Media, a Mexican media company reaching 90 million users per month.




Thanks to those that participated in LAVCA's Annual Investor Meeting last week. The program had record registration. A special thanks to sponsors: Omidyar Network, Telefonica Open Future_, Silicon Valley Bank, FOMIN, Ministerio de Producción Presidencia de la Nacion Argentina, Riverwood Capital, and CAF. More information here

#LAVCAWeek #Quotables:

"#LatAm is the most fertile ground for #agtech" - Carlos Kokron @QualcommVenture

''Cómo escalar inversiones tempranas'', con participación de @dgbravo @mlemos @ferlelo @mnicklas y Patrick Arippol

“My mission is to promote determination among the underserved.” — Ryan Williams, Founder & CEO of Cadre, on thriving outside of Silicon Valley.

“We want to reduce poverty through innovation.” — Lucas Cornejo, National Director of Venture Capital, Argentina

"In #LatinAmerica there are plenty of successful stories to invest in" Angel Uribe @ TPG Growth



> The Multilateral Investment Fund (MIF), with the Rockefeller Foundation and Tranforme Finance, published a new report on financing structures and alternative financing trends for impact enterprises in LatAm: Innovations in Financing Structures for Impact Enterprises: Spotlight on Latin America.

> Barclays launched the Multi-Impact Growth Fund, an impact investing vehicle that will primarily invest in specialist third party funds.

> Salesforce launched a US$50m impact investing fund. Salesforce Ventures, the company’s corporate venture vehicle, has invested in over 250 startups to date, including Dropbox and Twilio.

> Credit Suisse announced the creation of a new department to nurture socially conscious investing.

> OP-ED: The Abraaj Group's Arif Naqvi in Reuters on Forging Partnerships, Creating Impact – A New Model for Business.

> FLII CA&C, The Foro Latinoamericano de Inversión de Impacto for Central America and the Caribbean, will take place on November 8-9, in Antigua, Guatemala. Details here.

> CISCO is awarding Global Impact Cash Grants to non-profits and NGOs addressing significant social problems. Details here.



LatAm continues to dominate high-growth markets for major digital companies:

  • Mexico and Brazil are among Spotify’s top four markets by volume of streams. And Latin music captures 8% of streams in the US.
  • LatAm is a “breakneck growth” market for Pinterest, which just crossed the 200 million mark 2½ times faster than it took to reach 100 million "Pinners".

> US$4.4b Global agtech funding in the first half of 2017, according to a new report from AgFunder, is up 6% from last year. A majority of funding went to food delivery startups.

> US$10.7b Amount invested in China startups in Q2 2017, according to KPMG.

> 73% How much of Brazil’s mobile connections happen on a smartphone, according to GSMA. 63% of Mexico’s mobile connections and 55% of Argentina’s are also on a smartphone. The average for LatAm is 60%, up from 10% in 2012.



> Brazil has proposed new regulations to marketplaces and transport apps. Competitors 99, Cabify, and Uber are uniting to oppose PLC 28/2017, a Senate bill imposing new regulations on transport apps.

> The Economist: What if large tech firms were regulated like sewage companies?

> Jonathan Taplin at the USC Annenberg Innovation Lab talks about why regulating Google and Facebook like utilities is a long shot:

GDPR (General Data Protection Regulation) goes into effect in the EU in 2018. That's an existential threat to the current business model of Google and Facebook. It will force them to move from a system where just by signing on to Facebook, you've given consent for them to use all your data. The new idea is, you have to opt-in to give them permission to use your data.

> The National Venture Capital Association filed a motion for a preliminary injunction to force the Trump Administration to implement the International Entrepreneur Rule.

> CNNtech: Trump is making it harder for immigrants to start businesses.

> READ more tech and policy updates on



> WeXchange’s Pitch Competition is open for applications until October 7:

¿Eres una #emprendedora que busca transformar el mundo con tecnología? ¿Estás al frente de una startup que opera en América Latina y el Caribe? Postúlate al Pitch Competition de WeXchange de FominBID y NXTPlabs y sé una de las seis finalistas.

> Y Combinator is accepting applications until October 3. Need a reason to apply? READ how Y Combinator helped the teams at Rappi and Hogaru raise capital from Silicon Valley investors.

> ABVCAP is hosting its 4th Brazilian Venture Capital Conference in São Paulo on October 5. Check out the agenda and speakers.

> Startupbootcamp FinTech Mexico City Demo Day is October 12 at 5:30pm in Mexico City. Details here.

> Startup Brasil is accepting applications until October 14. Startups can apply here.

> Seedstars World, with support from Bradesco, hosts its competition for early stage startups in emerging markets on October 17 in São Paulo. Details here.

> blastu is hosting a festival on October 17-18 in São Paulo for entrepreneurs and startups. Details here.

> AMEXCAP is hosting its annual event Mexico VC Day in San Francisco on October 19. Register here.

> Resultados Digitais’ popular RD Summit is October 18-20 in Florianopolis, Brazil. More info and tickets here.

> 500 Startups is hosting its 500 Demoween Day Batch 22 on October 25. Get tickets here.

> Argentina’s Ministerio de Producción invites Argentine accelerators to apply to the Fondo Aceleración to receive financial support for operating costs and matching funds for entrepreneurs. Apply by November 6.

> Argentina’s Ministerio de Producción invites Argentine VC funds raising a minimum of US$18m to apply to the Fondo Expansión to receive financial support for fundraising costs. Apply by November 6.

> Google Campus in São Paulo is Google’s largest campus globally with 89,000 members. Globo interviews Google Campus head André Barrence a little over a year after the São Paulo launch:

"Para nós, esse é um grande passo e um motivo de bastante satisfação e orgulho. Em pouco mais de um ano, nós conseguimos nos posicionar muito bem e atender a comunidade empreendedora brasileira que tinha uma demanda reprimida por espaço e conteúdo."



> What is Facebook? From NYMag:

We can talk about its scale: Population-wise, it’s larger than any single country; in fact, it’s bigger than any continent besides Asia. At 2 billion members, “monthly active Facebook users” is the single largest non-biologically sorted group of people on the planet after “Christians” — and, growing consistently at around 17 percent year after year, it could surpass that group before the end of 2017 and encompass one-third of the world’s population by this time next year. Outside China, where Facebook has been banned since 2009, one in every five minutes on the internet is spent on Facebook; in countries with only recently high rates of internet connectivity, like Myanmar and Kenya, Facebook is, for all intents and purposes, the whole internet.

> #TRANSPORT: Indian rideshare company Ola raised US$2b from SoftBank, Tencent and others. Ola has raised almost US$4b to date from Tiger Global Management, Sequoia Capital, DST Capital, and others.

> Grupo Assa invested US$10m in Parabolt, an Argentinian technology startup incubator.

> #AGTECH: SPRO IT Solutions made an undisclosed investment in E-Aware Technologies, a startup making wireless sensors for manufacturing and agtech applications.

> Bloomberg says SoftBank Plots Deals to Build a US$300b Asset Management Arm. Apparently, SoftBank’s US$93b Vision Fund is just the beginning. As a reminder, SoftBank had no assets under management 12 months ago.

> #FINTECH: Ripio Credit Network launches, aiming to attack bank loan fees in emerging markets.

> Americas Quarterly: China's Strategic Play in Brazil:

To be sure, Latin America is squarely in the sights of the Chinese government and investors. Already Brazil’s leading trading partner, China’s presence in the country is set to increase dramatically by next year. In 2015, Xi committed to almost doubling two-way trade with the region to US$500b within the decade. He also intends to increase investment by another US$250b by 2020. Once heavily concentrated in commodities and manufacturing, Chinese firms are now exploring new ground, from logistics to renewable energy.

> China Daily interviews founders from Truckpad, Parafuzo, and others on a funding road show in Beijing in Brazilian internet companies seek funds from China: "We feel we are similar to China and that's why we came to China for financing, not the United States.”

> Economía y Negocios: Quince emprendedores chilenos van esta semana tras la conquista de Silicon Valley.

> LAVCA IN THE NEWS: Reuters: LAVCA names new Chairman Carlos Garcia of Victoria Capital Partners. See LAVCA's full Board of Directors here.




> WSJ: Goldman Sachs Explores a New World: Trading Bitcoin:

Goldman’s effort is in its early stages and may not proceed… China in recent weeks has banned exchanges that trade bitcoin, fearing the virtual currency could provide an avenue for capital flight. J.P. Morgan Chase & Co. Chief Executive James Dimon, whose bank is the largest dealer in global currencies, last month called bitcoin a “fraud” and said he would fire any employee who traded it.

> WSJ says US$1.5b has been raised through ICOs so far in 2017. ICO fundraising surpassed early-stage venture investing for the first time in June.

> Fred Wilson, who has crypto investments in Polychain Capital, Coinbase, and the largest ICO to date, talks about how diversifications saved him in the last internet crash, and says crypto only represents 5% of his assets:

"I know a lot of people who are true believers in crypto and have made fortunes in it. They are “all in” on crypto and have much of their net worth (all in some cases) invested in this sector. I worry about them and this post is aimed at them and others like them. It is fine to be a true believer and being all in on crypto has made them a lot of money. But preservation of capital is about diversification and I think and hope that they will take some money off the table, pay the taxes, and invest it elsewhere."

>  In Bloomberg’s A Crypto Fund King Says Bitcoin Will Be the Biggest Bubble Ever, a former Fortress Investment Group manager who is raising a US$500m hedge fund to invest in cryptocurrencies, says he has 20% of his assets in crypto:

"This is going to be the largest bubble of our lifetimes. Prices are going to get way ahead of where they should be. You can make a whole lot of money on the way up, and we plan on it."



> David Schlesinger, the former Chairman of Reuters China, gives a deep dive on China tech. Highlights:

  • At US$790b annually, Chinese mobile payments are 11x those of the United States.
  • China is home to 43% of the world’s tech unicorns. China’s 89 unicorns weigh in at a total valuation of US$380b.
  • The Chinese population generates 13% of the digital information globally, with expectations this will rise to 20-25% by 2020.

> Sanjay Zimmerman of White Star Capital has an overview of VC activity in Canada for 2017.

> Derek Bittar of Indicator Capital talks about PE vs. VC mindsets in 7 Reasons Why Traditional Investors Don’t Understand Venture Capital.

> #LOWTECH: Josh Browder, the 20-year-old Stanford student who launched a chatbot that has voided over 225,000 parking tickets, says he is going for the low-hanging fruit:

"We’re getting driverless cars today and sending people to space, how is it that we haven’t yet automated a few documents yet. It’s really such a low-hanging fruit. All you have to do is figure out how these documents are constructed and then use technology to automate them. I think we’re already doing far more complicated things successfully."

> Jim Sinocchi, Head of the Office of Disability Inclusion at JP Morgan Chase, updates our ideas of disability inclusion in the workplace:

"Disability inclusion is no longer about automatic doors, curb cuts, ramps, and legislation. These historic efforts were essential at the time and represented the thinking and necessary change required for people with disabilities in the 20th Century. Today, the new era of disability inclusion is about “assimilation” – hiring professionals with disabilities into the robust culture of the firm. Full assimilation requires a leadership team with the will, commitment and attitude to identify, train and groom professionals with disabilities for leadership positions at the firm as we do with mainstream employees."


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