Ep. 46: Is late-stage funding coming back?
Welcome to Miranda Scenius: Your weekly newsletter on technology, innovation, and startups in Mexico.
A US$10 million Pre-A Series, a US$2 million Pre-Seed round, a US$10 million Seed round, have we traveled back in time to 2021? With Clara securing US$ 60 million in equity last week, massive early-stage rounds this week, and some insightful conversations with late-stage founders about to close new capital rounds soon, it seems like spring is just around the corner for startups.
In addition to funding announcements, this week Kigüi made headlines with its market entry and we welcomed more global startups to our querido Mexican market.
Follow The Money
Galactic Holdings raised US$10 million in a pre-Series A
Galactic Holdings is a cryptocurrency firm offering an all-in-one ecosystem for cryptocurrency transactions, including a wallet, exchange, and a stablecoin pegged to the Mexican peso, making it one of the most complete crypto platforms in Mexico. The funding will support Galactic Holdings' expansion to other Latin American countries and the development of new innovative products. According to a report by Chainalysis, growing interest in cryptocurrencies in Latin America is being driven by high inflation rates, limited access to traditional banking services, and a large population of unbanked individuals.
Sector: FinTech - Web3
Total raised to date: US$10 million
Founders: Maggie Wu, Bowen Z
Investors: BAI Capital, Y2Z Ventures, Longling Capital, TKX Digital Group, Perseverance Capital, Palm Drive Capital
Senzai raised a US$2 million pre-Seed round
Senzai wants to help companies in Latin America harness the full potential of artificial intelligence (AI) with its optimization tools. Senzai's technology focuses on three tools: measuring impact, experimentation, and optimization to understand how customers are likely to respond to certain sales and marketing campaigns, ultimately improving outcomes. The company will use the capital to test its product with three clients as it prepares for a formal launch at the end of the year.
Sector: AI - Analytics
Total raised to date: US$2 million
Founders: Julián López-Portillo, Darren Timmins
Investors: ALLVP
Syncfy raised a US$10 million Seed round
The open finance platform, and a subsidiary of Paybook, provides an API to integrate financial data from more than 125 banks, digital wallets, tax authorities, crypto exchanges, and blockchains across 15 countries in Latin America. The funding will be used to expand to new markets and launch new products such as data aggregation, enrichment, and analytics, as well as payments infrastructure. In addition to providing data aggregation and financial information development services, the company also offers products such as Syncfy Connect, Syncfy Fiscal, and Syncfy Stamping.
Sector: FinTech - Open Finance
Total raised to date: US$10 million
Founders: Gerardo Treviño
Investors: Point72 Ventures, JAM Fund, Ausum Ventures, Avalancha Ventures, FJ Labs, Mantis Venture Capital, XBTO Humla Ventures
R2 secures a US$100 million loan from CIM
The fintech has secured a new asset-backed loan from Community Investment Management, which will be used to expand its loan portfolio. Unlike a venture debt facility, R2's loan is backed by its own loan portfolio in Mexico. The fintech highlights how it leverages the data from its technology platform partners for underwriting. The financing comes on the heels of R2's US$15 million Series A in 2022. R2 has already extended over US$20 million in revenue-based financing to over 6,000 SMEs in Mexico, Colombia, Chile, and Ecuador.
Sector: FinTech - Lending
Total raised to date: US$21 million Equity + US$100 million Debt
Founders: Roger Larach, Roger Teran
Investors: Community Investment Management (CIM)
Startups News
Kigüi app aims to reduce food waste in Mexico
Kigüi has developed an app that allows consumers to purchase products nearing expiration at up to a 50% discount. Users select products from the app, complete their purchase, and upload the receipt and expiration date to the platform to receive a reimbursement.
The startup, which launched in February 2022, has around 56,000 users in Argentina and 32,000 users in Mexico and works with 50 of the main food brands. Kigüi aims to reduce brand losses by 25% this year and invoice $100,000 per month within a year. The company also plans to expand throughout Latin America and Europe, citing the old continent's CO2 reduction policies.
Furthermore, the team has been selected as one of the 20 startups to participate in the AWS Impact Accelerator.
VC - Accelerators News
Huawei launches its 2023 Spark program
In partnership with the Mexican Agency for International Cooperation for Development and the Ministry of Foreign Affairs, Huawei’s Spark program aims to accelerate technology in Mexico and Latin America by supporting 60 startups. Selected startups will receive financial support from Spark, ranging from US$2,000 to US$100,000. In addition, the selected startups will have access to Huawei’s cloud technology, mentoring from public and private sector companies and organizations, connections with venture capital funds, monthly networking events, and other benefits.
Rest of the World
Chilean FoodTech comes to Mexico
Startup Ok to Shop, which delivers nutritional information about food through an app, is expanding into Mexico. The company has contracts with major supermarkets such as Jumbo, Líder, Unimarc, and Tottus, as well as platforms like PedidosYa, reaching over 2 million customers. Ok to Shop has grown an average of 17% per month in sales over the past four years and opted not to raise venture capital. The app also provides alternative products to meet specific dietary needs. Ok to Shop's expansion into Mexico is set to begin in the second half of the year.
Peruvian Leasy expands to Mexico
The provider of vehicle financing to gig economy workers has raised US$25 million in debt financing from UK-based Lendable. The investment will be used to help the startup double its growth in 2023 and support its expansion to Mexico City and Lima. It also works in partnership with ride-hailing platforms Uber and Cabify.
Romanian Pluria consolidates position in Mexico
The startup which offers flexible workspace solutions in Latin America has raised $2 million in a funding round led by Eleven Ventures to consolidate its position in the Mexican markets and expand into Argentina, Chile, Brazil, and Peru. Pluria currently has over 500 flexible workspaces and has connected more than 150 companies with its workspace model.
Community
Every week we share what we have been reading or listening:
SemillaVC interview of Marcial Gonzalez Fraga, Latitud Lead Investor
Opinno reports on the CVC ecosystem in LatAm
Banking-as-a-Service in Latin America: three current use cases
Ángel Sahagún, was born in Campeche, Mexico, hailing from a middle-class and very hard-working family passionate about innovation and technology. When he was 17 he moved to Merida to study industrial engineering. After a year, he wasn’t sure about his career choice and what to do next, so he went to Jalisco and started working for ONG to support vulnerable people. The experience blew his mind and helped him realize how the world was heading the wrong direction and how we all could help change that. After two years, he returned to Merida to finish his studies with one thing in mind: everything he does has to have a positive impact for change.
At that time, he and his family had lots of debts and economic issues. To help them, he started working but he also built up a lot of personal debt and couldn’t manage his finances with freedom, so he began to learn about personal finances, writing down his income and expenses. He thought it be would awesome to create an app where anybody could manage their finances with freedom and created his first company, Money Mentor, a Blackberry app (the first one in LATAM) to help people control personal expenses and debts.
It didn't last long because he was so young, made some bad decisions and the market wasn't developed or familiarized with digital apps. Subsequently, he worked for three years for various banks developing and constructing better digital platforms, and learning why their software, platforms, and customer services weren’t very good. That job helped him learn and gave him credibility. In 2015, he decided to create an efficient and innovative 100% online bank that understands customers’ needs and gives people financial freedom. That's how albo was born.
In 2016, the bank went live. The first year was difficult because it wasn’t a ‘normal’ bank, people were distrustful, and the team had to work hard to fundraise capital. But, with time, tenacity, perseverance, resilience, and teamwork they made albo the number-one digital bank in Mexico.
What would you have liked to know before starting your company?
To never lose sight of my ultimate goal to enable people to people have healthy finances and financial freedom, and to celebrate successes when everything is going well. I find it a bit complicated to celebrate wins because I always want more. This is good because it makes you go beyond, but on the other hand, you can’t enjoy the present. That said, I’ve learned to enjoy the successes. Also, I would have liked to know not to take things for granted, you have to communicate them to your team, celebrate and motivate your people to make things happen. And finally, it’s important to know everything is temporary, both successes and failures.
What outsiders often fail to understand about your company?
They may underestimate the amount of time and effort that goes into building a successful company. Startups and other businesses often face numerous challenges and setbacks along the way, and it can take years of hard work and perseverance to achieve success.
What's one thing you can keep talking about for hours?
I'm a huge fan of Real Madrid. I love the club’s long and storied history and it is one of the most decorated teams with a legacy of success on the field. And of course, we can’t deny that some of the most legendary soccer players in history like Alfredo Di Stefano, Ferenc Puskás, Cristiano Ronaldo, and Zinedine Zidane have played for them. I travel to see their semi-finals or final matches every time I have the chance.
What is the weirdest job you’ve ever had to do?
When sports betting via digital platforms began, I found out that you could win money even if you bet on the losing team, so I started raising capital among friends and people who wanted to invest their money in bets and get a safe return. That's how I ended up in betting arbitrage, generating returns for investors and a fee for me. After the platforms began to introduce the same odds, the business couldn't keep going.
What makes you bullish on the Mexican startup ecosystem?
Well, firstly Mexico has a large, young, and growing population that is increasingly tech-savvy and digitally connected. There is a significant opportunity for startups to target this market with innovative products and services.
Also, there is a growing interest among investors and venture capitalists in the Mexican startup ecosystem. In recent years, we’ve seen a significant increase in the amount of investment flowing into the country, as well as a growing number of successful exits of Mexican startups. This trend is likely to continue as more investors recognize the potential of the Mexican market and the talented entrepreneurs who are driving innovation and growth in the region.
See you for the next edition. Have a question or any feedback? Just hit reply. We'd love to chat!