From Founders To Investors: How Entrepreneurs Are Now Financing The Ecosystem

It is no secret that the entrepreneurial ecosystem in Latin America has grown considerably during the year 2021. Just in the first half of this year, the region received US$9.3 billion; almost twice the amount raised in 2020.

A CB Insights report points out that the total investment for Latam during 2021 was US$14.8 billion. This marks a 174% YoY increase.

Although the vast majority of these investments came from VC or investment firms, individual investors have also had an important role in financing the newest batch of Latin American startups.

It has become increasingly common that some of these investors are themselves founders of successful companies and now seek to expand their portfolio by supporting projects with potential.

This is just another sign of the region’s current consolidation stage. We’ve already talked about what startup acquisitions mean for LatAm. Now it’s time to mention how successful entrepreneurs contribute to multiplying other startups’ success in the region.

From Founder to Investor

Brazilian challenger bank Nubank recently debuted its IPO and became the region’s largest bank by market cap. Besides being an inspiration for regional companies, Nubank’s founders and employees have also been financially responsible for nurturing other emerging LatAm tech companies.

According to Endeavor, the so-called “Nubank mafia” includes people related to this company who have either created or invested in a multitude of new startups from different sectors. These include the fintech Belvo, healthtech startup Sofia, corporate finance companies Clara and Jeeves and Colombian proptech La Haus. Velez’s own portfolio includes La Haus, Justo, Favo and Nuvocargo.

Likewise, Ricardo Weder, co-founder and CEO of the digital supermarket Jüsto, has also recently invested in companies such as Cargamos, dedicated to last-mile deliveries.

Other founders who have positioned themselves as investors include Carlos García Ottati from Kavak, who invested in Cargamos and in the Brazilian insurer Justos; Brian Requarth of Viva-Real invested in La Haus; Daniel Vogel of Bitso invested in the on-demand salary company Castor; and Adalberto Flores of Kueski who participated in the most recent investment round of the e-commerce company Quinio.

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