In a context of uncertainty in the startup ecosystem due to macroeconomic problems that took force in 2022 and the recent collapse of Silicon Valley Bank (SVB), Latin Leap arrives in Latin America with a US$25 million fund targeted at early-stage companies.
Latin Leap was born in 2019 in Singapore and started operating in Asia. It is now expanding its operations to Latin America by opening a headquarters in Colombia, from where it will look for around 15 startups to invest in over the next three years, the VC said in a statement.
It will mainly focus its investments in the fintech, healthtech, edtech, proptech, and mobility tech sectors of startups from Mexico, Colombia, Peru, and Chile—as well as those companies that already have artificial intelligence implementations in their operations.
A great moment for early-stage startups
With the arrival of Latin Leap, which has a significant presence in Asia and whose founder is Stefan Krautwald, one of the predictions that partners from different Latin American investment funds told Contxto at the end of last year comes true: there will be less capital for late-stage startups and more activity in early-stage ones.
At that time, they mentioned that after 2021 with a record amount of investment (US$15,000) in the region, it was time to stabilize capital and be more disciplined in investing.
Now, after 2022 where investments fell 47% compared to the previous year, Krautwald told the media that the startups born in these times, where the context is difficult, will be the winners that will impact the economy in six to eight years —and that it is an excellent time for them. He exemplified this with the 2008 financial crisis, where big tech companies like Instagram, Uber, and Airbnb were born.
“In the world, there is more caution with series B, C, and D investment rounds onwards, there is some contraction there, but we see that seed or pre-seed investments will remain strong because that is where capital is patient and companies have enough time to develop into something relevant,” Krautwald said in the press release.
Prior to its official arrival in Latin America, the new VC fund had already invested US$5 million last year in companies based in different countries in the region, such as Habi, Meru, Valoreo, Farmalisto, Cornershop, Elenas, Luable, Talently, Cubo, KB, Grizon, Vozy, Treggo, and Vecindario.
Finally, the investment committee of the new VC fund is made up of Krautwald, founder of Latin Leap and who has held roles as CEO of Cdiscount and Dafiti, as well as the founder of Farmalisto and Flux app; Rodrigo Zorrilla, president of Afore Citibanamex; Madeleine Clavijo, co-founder of Kushki; David Geisen, CEO of Mercado Libre and founder of the Mexican Association of Online Sales (AMWO); and Pablo Padilla, founder of Columbus Asesores Patrimoniales.
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