Macro: Venture Thrives, Constructive Economic Growth and Policy Normalization

Integra views 2022 as a year for transition in financial markets with the potential for constructive and moderate returns for risk assets. As the massive monetary and fiscal stimulus tapers, the global economy is entering a new regime with policymakers struggling to adapt to surprising data without spooking the markets. With the potential for volatility as rates gradually rise it will be important to deploy capital in high quality companies which are well positioned to sail through cyclical challenges and benefit from the tailwinds of secular shifts.

The headwinds from higher inflation, supply chain constraints and financial and monetary policy normalisation will negatively impact some asset classes and present new opportunities for others. Venture backed privately held tech-enabled companies should continue to benefit. The VC model which emphasises rapid transformational growth and scalability remains uniquely placed to tackle the major societal issues facing us today.

The Better Future Fund is helping to create a new tech enabled future throughout Latin America. We view Latin American early stage companies as remaining attractive on a risk adjusted basis, versus other opportunities. By focusing on this often and unjustly overlooked geography and backing sectors benefiting from current uncertainty and the region’s tech-enabled needs we believe we can offer our investors higher returns.

At Integra we view the potential to unlock greater value for founders and investors by being a first institutional check for companies by deploying capital at the seed, series A and series B stages. Our investment team continues to choose high quality companies with exceptional teams that are solving enormous challenges, achieving a lot with few resources, building a wide MOAT with strong cash management to confidently approach 2022 and beyond.

Latin America Venture Capital Ecosystem is BOOMING

In 2021, venture-backed companies raised $15.3 billion across 650 deals in Latin America, according to PitchBook data and Lavca. That’s more than the total capital invested in the region in the previous six years combined.

Growth firms like Tiger Global, D1, DST and Coatue all increased their focus on the region. Earlier-stage investors, such as Andreessen Horowitz, Accel and Benchmark, also started pouring money into Latin American startups. This is increasing valuations at the growth stage and emphasizing the importance of investing early, (ideally being a first institutional check), so we can help unlock value starting valuations.

Undaunted by the recent contraction of the Brazilian economy and steep interest rate hikes, Brazil-based digital bank Nubank priced its shares at the top of its revised target range to raise $2.6 billion in a stock market debut that values the company at $44 billion on a fully diluted basis.

With an eye on the future we anticipate the funding environment to become more competitive and selective, meaning the funding path from Series A to B will be narrower as tapering continues and financial conditions tighten, albeit moderately. The best technology has been proven to succeed despite various economic and political regimes and we view the next 5 years with a focus on quality, cash management and scaling quickly to accomplish a lot fast.

Source: Pitchbook Data, LAVCA

Better Future Fund Updates

The Firm's News

New Palo Alto presence: we are based across from the Stanford University campus and we are delighted to be plugged into our powerful Stanford Alumni and current student network to maximize synergies between the Bay Area ecosystem and Latin America.

100WF Global FundWomen Week: Official emerging managers selection JPMorgan and 100 Women in Finance: Following a rigorous selection process Integra Groupe attended the JPMorgan Emerging Managers Conference introducing our early-stage Better Future Fund to dozens of institutional fund selectors for the first time. This is a core part of our capital raising strategy which will soon include some of the world’s largest investors.

Launch of Integra Secondaries: Integra is curing a pain point for founders and stakeholders at Latin America’s top startups. By providing liquidity to early-stage venture capital backed firm equity holders we are providing our LPs with access to some of the fastest growing innovative firms in Latin America.

Stay tuned as we continue to grow this business unit and present you with deals that are improving lives and solving challenges.

Recognition as Top Tech Investor: Our managing partner, Francesca Whalen, recognized by the association for private capital investments in Latin America (LAVCA) and the Inter-American Development Bank Lab (IDBLAB) as a top technology investor which resulted in substantial inbound investor interest.

Integra releases iScore Web Tool: This fall Integra launched the first-ever quantifiable ESG score for early-stage Latin American companies. Filling this market gap wasn’t enough! In our mission to provide a founder friendly and investor necessary dashboard we launched the beta version of the iScore interactive platform. This beta version will bring a user friendly front-end to all the data crunching Integra Investment Team performs in the stack.

New Portfolio Companies

A Cohort based online courses for professionals in Latin America. 

Kurios instructors are professionals coming out of tech companies like Google, Amazon, Stripe and more. Our course completion rate is 90% and annual customer retention rate is 100%. We have 65 B2B customers and we up-skill their employees in product management, growth and data analytics. Some of our customers include: Walmart Mexico, Banorte (2nd bank in Mexico), Mercado Libre, BCP (#1 bank in Peru), Alicorp (leading CPG in Latam), Sura (leading pension fund).

E-Learning – B2B – Education

Founded in 2019

Peru

Founders

Carlos Lua – Co-founder & CEO. Ex-Uber Latam early stage employee. Contributed to the 60x growth in the Peruvian operations, as a Growth and Operations Manager. Launched and scaled UberDost in Latam (Brasil, Mexico, Colombia and Peru), a supply growth app. Ex-Amazon USA Product Marketing Manager Intern. Alumni – University of Texas at Austin.

Luis Ubillas Door – Co-founder and COO at KURIOS. Luis started his career in investment management at BCP (Peru’s largest bank). After his MBA he transitioned into tech working at Amazon as a financial controller in the North America ecommerce business. Additionally, he worked as an independent consultant in product and growth strategies for +$1B dollar companies in the consumer, financial and insurance sectors.

Impact Progress

Industry Insights

Testimony

“Chazki’s culture has been embedded with the growth mindset. We managed to transfer Kurios’ growth methodology to our quarterly OKR process, helping us increase our decision making and project speeds, always aligned with our North Star Metric. Highly Recommended!” – Gonzalo Begazo, Chazki CEO

CPG company with more than $3bn in annual revenue and presence in 6 Latin American countries: Argentina, Brasil, Chile, Colombia, Ecuador and Peru. Impact: 200+ workers impacted.

A wireless ISP for communities in urban Latin America offering a faster and better, easy-to-pay service.

Telecom – Community – Tech

Founded in 2020

Mexico

Founders

Joel Phillips – Co-Founder and CEO. Latam based, Columbia Economics, Previously Pig.gi, WhisperShout. Passion for solving problems in emerging markets with technology. Interested in fintech, decentralized models, blockchain, connectivity, and emerging market economics.

Isaac Phillips – Co-Founder. From Colorado living in Mexico City. Interested in wireless, digital inclusion, blockchain, financial inclusion, and ed-tech. Previously at Pig.gi, Dish Mexico, & Echostar.

Impact Progress

For many of these homes, this is the first time they have a dedicated internet connection at home, and for almost everyone, this is a first time for decent, high speed connection.

Latin America and the Caribbean could dramatically increase employment and kickstart sustainable economic growth if it closed its digital connectivity gap with members of the Organization for Economic Cooperation and Development, according to a new study by the Inter-American Development Bank (IDB).

Closing the gap with OECD countries would create over 15 million direct jobs, boost regional economic growth (GDP) by 7.7%, and increase productivity by 6.3%, according to the study.

Testimony

Impact where it matters: thanks to Siglo, a single mother of two received access to the internet at home for the first time. This allowed her children to attend school online after a year of disruption to their education.

Why choose Siglo

  • Filling a market gap with an experienced team of serial founders.
  • Profound technical knowledge of telecom operations in Mexican market.
  • Enormous social impact for users formerly alienated from reliable and affordable internet.
  • Building a market MOAT with industry relationships, technologies, experienced staff who have the ability to quickly install new infrastructure.
  • Strong unit economics.

Seed investment alongside: Goodwater Capital, Canary, Soma Capital and Paul Allan at $15M post valuations

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