How Latin America became tech’s next big frontier

Capria on

October 15, 2021

Buying a used car, renting an apartment or opening a bank account: all recurring nightmares in Latin America, because of reams of paperwork, lethargic bureaucracy and legal pitfalls.

Start-ups created to tackle problems like these are propelling the region to the forefront of the emerging market tech boom. Last year US $4.1 billion of venture capital investment flowed into Latin America, exceeding southeast Asia’s $3.3 billion and beating Africa, the Middle East and central and eastern Europe combined, according to the Global Private Capital Association.

 

“We started in this industry in 1999 when there was hardly any internet, almost all the connections were dial-up and internet penetration was 3%,” said Hernán Kazah, co-founder of Kaszek Ventures, Latin America’s largest early-stage fund with more than $2 billion of capital raised to date. “Today, Latin America finally has critical mass in almost every market.”

Nubank exemplifies the new breed of Latin American start-up. Co-founded in 2013 by Colombian entrepreneur David Vélez after it took him six months to open a bank account when he moved to São Paulo, it has grown exponentially and now has more customers than any other standalone digital bank in the world.

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