The world of startups in Latin America is experiencing unprecedented growth. According to the latest report, Tech Landscape in Latin America 2023, published by Distrito, the leading platform for emerging technologies in the region, the number of startups has increased by a factor of 60 since the 2000s, reaching a total of 33,489 companies.
The report, conducted with the support of SoftBank Latin America Funds and Upload Ventures, shows that Brazil dominates the space with more than 13,000 active startups, accounting for 62.9% of the total.
Fintech has emerged as the most important sector in the region, followed by Retailtech and Martech. These sectors are present in specific countries and relevant across the entire region. Gustavo Gierun, CEO of Distrito, notes that the predominant business model is Software as a Service (SaaS), which offers greater scalability and opportunities to connect with customers and investors.
Brazil, the largest startup market in Latin America, also hosts the majority of “unicorn startups,” valued at more than USD $1 billion. Of the 45 unicorns in Latin America, Brazil is home to 24. Argentina and Mexico follow with 7 companies each.
Since 2019, startups in Latin America have received more than USD $37 billion in investment through 5,464 funding rounds. However, the report also points to a slowdown in the venture capital market over the past year, particularly affecting the more advanced stages of investment.
Alex Szapiro, Head for Brazil and Managing Partner of SoftBank in Latin America, and Rodrigo Baer, cofounder and managing partner of Upload Ventures, emphasize the substantial growth of the tech market in Latin America, particularly between 2019 and 2021. Both industry leaders recognize the need for greater discipline and efficiency in management as a response to current challenges.
The report concludes that the technological ecosystem in Latin America is maturing, driven not only by the growth of startups but also by the entry of international investors. “The injection of large sums of capital has accelerated the growth of many companies and has stimulated innovation globally,” says Gierun.