Like the US, Latin America has a two-tiered venture capital market – TechCrunch

Earlier this week,exchange I wrote about the early venture capital marketIt seems that some startups are procuring the first letter round in the early stages of scaling, with the aim of understanding how some startups are procuring seed capital before working on Series A. ..

The expedition was rooted in commentary from Rudina Seseri from Glasswing VenturesWith abundant seed capital in the United States, founders can accomplish a lot before procuring Series A and can effectively delay these rounds. But after their founders raised that A, their Series B rounds were rapid thanks to the emergence of late-stage funding in early-stage trading in the hope of taking ownership of hot companies. May follow.

idea? Fast Bs, as slow.

After discussing the concept with skippers and many other venture capitalists, a second dynamic emerged. This means that, as Seseri explained, the “typical” early-stage funding rounds were “becoming atypical due to the rise of preemptive rounds.” [in which] Typical expectations for indicators come out of the window. “

Exchange researches startups, markets, and money. Read it Extra crunch every morning Or get Exchange newsletter Every Saturday.

Series As may come just months after the seed trade, and in Series B rounds, the expected revenue threshold is “on the market, offering a different product than regular VCs. There was a large multi-asset player-very fast “partially down. Term sheet, no active involvement after investment, large investment amount, high evaluation. “

Focusing solely on Series A dynamics, the old rule of thumb that startups need to reach $ 1 million in annual recurring revenue (ARR) is now often controversial. Some startups have postponed the A round until the ARR reaches $ 2 million, thanks to ample seed capital.

Some startups delay the A round, while others raise significant investments early, perhaps including hundreds of thousands of dollars in ARR.

What is the difference between the two groups? “Elite Status” startups can jump to Series A, but other founders spend more time putting together the right seed capital to reach a scale large enough to attract A. I will.

Dynamics is more than just a US phenomenon. The two-tier venture capital market is also emerging in Latin America, a globally important and rapidly expanding startup region. (For example, Brazilian fintech startup Nubank, Finished a $ 750 million round.. )

This morning we dive into the Latin American venture capital market and its early dynamics. I also have a note about the European scene, so I think it will be more talked about next week. let’s go!

What’s hot

Mega rounds are no exception in Latin America. In fact, these are trends and bigger rounds have been announced in the last few months.

The announcement itself often emphasizes round size.For example, the recent $ 100 million Series B round to Colombian proptech startup Habi Promotion As “the largest Series B for Colombian-based startups”. This follows other 2021 records, such as “Mexico’s Largest Series A” — $ 65 million at online grocery store Jüsto — And “the largest series A ever proposed by Latin American FinTech” — $ 43 million for “Latin American plaid” Velvo. Like the US, Latin America has a two-tiered venture capital market – TechCrunch

Back to top button