Silicon Valley Bank, Partners for Growth, and IDB Invest close US$30M fund for Latam startups

Contxto – Recently many startups have raised financing rounds to offer more loans to users and businesses throughout Latin America. Recent events suggest this trend will continue.

Yesterday (14), Silicon Valley Bank Financial Group (SVB) announced that it closed a fund for a US$30 million debt fund alongside Partners for Growth (PFG) and IDB Invest. 

Dubbed the “Latin America Growth Lending Fund,” it will provide later-stage startups in Latam and the Caribbean with structured debt. 

Furthermore, the fund is looking for companies looking to scale and working with tech solutions in the following verticals: software development, life sciences, healthcare, fintech, among others.

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Tres amigos: SVB, Partners for Growth, and IDB Invest 

The fact that the SVB has “Silicon Valley” in its name should tell you just how big a heavyweight it is. As a commercial bank, this institution has financed as well as injected equity capital into startups from around the world.

And it’s no stranger to Latin America. It previously invested in Argentine Auth0. But with this new project, it wants to delve deeper through structured debt.

According to a press release, SVB stated that it’s Latam’s recent exploits in innovation that convinced it to launch and close this fund. 

California-based Partners for Growth specializes in debt financing for tech companies.

New financing

Evidently startups have different financial needs that your “normal” bank can’t grasp. For which they need specialized services like those PFG offers.

• Related article: Fintech Finnu gets US$800K investment to give loans for phones

Among the trio of investors, it’s IDB Invest—a member of the Inter-American Development Bank Group—that has the most experience with the Latam ecosystem. So it will certainly play a central role in screening through ecosystems and markets.

Although it’s worth emphasizing that this Latin America Growth Lending Fund targets later-stage startups.

That suggests that the threesome of investors are risk-averse to younger, more volatile companies who may not be able to pay back the debt—more so in these times of uncertainty.

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-ML