Latin American VC Investments Triple Record to Pass $15bn in 2021

Venture Capital investing continues to boom in Latin America with the region attracting more than $15 billion in investments across more than 650 deals in 2021, according to LAVCA. This record number represents an amount greater than that of the preceding seven years combined and far outstripped the previous record of $4.9bn set in 2019.

Fintech remained as investor’s top pick in 2021, representing 39 per cent of all venture capital flowing into the region, followed by ecommerce (25 per cent) and property technology, or proptech (9 per cent).

“We’re also seeing fintech getting integrated into other sectors, with proptechs launching financing arms and agtechs launching credit facilities for agricultural producers, “said Carlos Ramos de la Vega, director of venture capital for Lavca.

Sixteen new unicorns joined the region in 2021, according to Lavca, including cryptocurrency exchange Bitso and Chilean plant-based food producer NotCo. This quarter is already off to a roaring start and we look forward to providing more updates soon. [1]

Source: Pitchbook Data, LAVCA

JPMorgan Plans to Hire 500 as it Takes Top Spot in Latin America

JPMorgan Chase & Co earnt more investment banking fees in Latin America than any of its competitors last year and plans to hire more than 500 people in the region as it gains market share and builds on its success in acquisition finance.

Alfonso Eyzaguirre, the JPMorgan’s CEO for Latin America and Canada, said that 2021 was the best year that the company had in Latin America (with the exception of fixed-income markets) and “we want to continue growing”. This bodes well with venture capitalists too, as other Wall Street banks have been benefiting from VC investments in tech, which have greatly strengthened Brazil’s equity capital markets. Goldman Sachs reported a record year in asset management, global markets, and investment banking.

Buenos Aires will be the hub for JPMorgan and will add to the current 3,850 employees based across Chile, Colombia, Peru, Argentina, Brazil and Mexico. The priority is on payments, asset, and wealth management which the bank is heavily invested in. Top deals include:

 
JPMorgan is aggressively investing in fintechs. In June they will buy a 40% stake in Brazil’s C6 Bank, after acquiring a minority stake in FitBank Pagamentos Electronicos SA. In Brazil, Eyzaguire said that whilst political instability and covid recovery might be challenging, a diversification and an increased exposure in the nation could allow investors to weather the cycles well. “The tech industry is emerging, and we hope to see something similar to what happened in Brazil, where it exploded.” [2]

97% of LATAM’s E-waste is Improperly Managed and Includes an Annual $1.7 Billion in Recoverable Materials

E-waste describes discarded electrical or electronic devices. The UN’s first assessment of Latin America’s e-waste found that only 3% was collected and safely managed, a fraction of the 17.4% global average. The UN assessment evaluated the each country’s volume, legislation and management infrastructure.

LATAM countries are scoring own goals in mismanaging waste disposal, as not only are many of the materials poisonous and toxic but because the proper management and disposal is an economic opportunity. Kees Baldé, a Senior Scientific Specialist at UNITAR SCYCLE said that the e-waste generated regionally in 2019 contained 7000 kg of gold, 310 of rare earth metals, 591 million kg of iron, 54 million kg of copper, and 91 million kg of aluminum, representing a total value of roughly US $1.7 billion of secondary raw materials. [3]

Source: UN Institute for Training and Research (UNITAR)

Latin America's Leaders Share their Priorities for 2022 in Davos Agenda

The leaders of Peru, Colombia, Guatemala, Costa Rica and Ecuador spoke at the Davos Agenda 2022 on their goals for this year. Latin America has faced social unrest, polarisation and economic uncertainty amid the pandemic. Unsurprisingly, battling Covid-19 by increasing vaccine rates in LATAM is a priority. The President of Costa Rica, Carlos Alvarado Quesada said that over 85% of the population is double vaccinated but increasing this number is pivotal.

Vaccination rates are inextricably tied to economic growth and recovery. President of Colombia, Ivan Duque, repeated similar sentiments as Quesada. He suggested that high vaccination rates will “return to pre-pandemic momentum.” United by their commitment to increasing inoculation numbers, they were equally united in their goal to improve equity gaps. The President of the Inter-American Development Bank stated that inflation, amongst many other challenges could not lead to a decade of missed opportunities when it comes to narrowing the economic gap.

Jobs and access to opportunity were a key priority for many speakers. The response to Covid-19, coupled with access to opportunity and a commitment to climate change goals will lead Latin American countries to prosperity. Quesada pressed on the importance of mitigating the effects of climate change and preserving biodiversity and the importance of integrating the environment into decision making because opportunity and biodiversity are intertwined. [4]

Mobile-First Blockchain Celo Launches Stablecoin Tied to Real

From the 27th of January 2022, three Brazilian crypto exchanges will list the cREAL, from phone-focused blockchain Celo. It will be available on Brazil-based crypto exchanges Ripio, FlowBTC and NovaDAX. Bitfy and Coins (crypto wallets) will also support the stablecoin.

Brazil has been one of the strongest markets for this adoption. cReal works as a a decentralized, crypto-collateralized algorithmic stablecoin that can be used for CeFi and DeFi apps and services on the Celo blockchain, such as the lending protocol Moola Market, the decentralized exchange Ubeswap or Valora, a mobile-first digital wallet native to the Celo network.

“The rate of cryptocurrency adoption in high-growth markets — in particular Brazil — not only signals growing excitement for this new digital economy, but the advance of real-world use cases,” Celo Foundation’s Latam lead Camila Rioja said in a statement. [5]

Selected countries around 1,000 respondents per country surveyed in 2019. Source: Statista

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