Venture capital investments in Latin America continue to consolidate in 2023 , a phenomenon that had already happened previously in 2022. The presence of a smaller number of mega rounds and a higher level of debt , both as a targeted financial tool for startups, These are two conditions that will be in force as projected by Endeavor and Glisco Partners . Panorama of startups with mega rounds and debt During the year 2022, investment through mega rounds, which were identical to or above US$50 million in startups with late processes, had a reduction of 88% in invested capital , while a 76% reduction in the amount of investments . These are data that were extracted from the Insights research: “Venture Capital and Growth Equity Ecosystem in Latin America.
Startup debt for 2023
During 2022, there was an increase of 94% in venture debt and financing lines , thus consolidating credit alternatives in Latin America, achieving the sum of about US$3,000 million distributed in 100 agreements , the study shows. Rappi and Kavak have been the two unicorns in the region that opted for debt, which Indonesia WhatsApp Number Data has allowed them to continue operating with great growth, although they have reduced their dilution. To start, Kavak raised about $810 million from Goldman Sachs, Santander and HSBC. For its part, Rappi obtained a financing line from Bancolombia and Banco de Bogotá , with an astronomical figure of US$112 million. Among the 36 unicorns on the continent , 44% obtained debt , mainly due to the uncertainty of a drop in their valuation, removing their unicorn status.
Financing lines for startups
The option of having financing lines highlights that startups in Latin America have a marked trust in traditional financing entities, being able to enhance the risk models assigned Canada Telegram Number List to HSBC and Goldman Sachs . For Enrico Robles del Río, who is director of intelligence at Endeavor , states that “It is a good sign for the entrepreneurial ecosystem since there is less aversion to risk on the part of the bank .” The acquisition of debt is a great decision opportunity for the long term, mainly for all companies that have the possibility of using debt to create added value . However, it is a situation that can be compromising for the investment of projects, since they cannot achieve the planned return.
