5 Startups disrupting LATAM
The most promising startups that I’d invest in
1. Arcus | Making fintech possible for everyone
Ignia Description: Arcus is a NYC-based Fintech company offering a white label bill payments platform to financial institutions (banks and fintech’s).
Arcus offers financial institutions a white label API that enables customers to pay all their bills on a single platform in real-time. By aggregating bills and providing a central record for cards, addresses, and settings, the platform significantly improves the experience of paying bills. The API allows financial institutions to offer new services while gaining access to customers’ spending habits, including utilities, cell phones, loans, credit cards, and subscriptions.
Currently, Arcus is present in 11 countries working with over 30 of the world’s leading remittance companies, banks, and mobile wallets.
Why I’d invest: Arcus has proven its a solution focused on cash-centric consumers. I’m a strong believer that cash still reigns king in places like LATAM. Cash is an serious aspect of the Latin market that’s not changing anytime soon…even if you offer a neobanking solution. For many people its been a challenge to manage and pay their bills with cash. That’s why the 7/11 partnership with Arcus is super important. Users can download the 7/11 app, add their bill, then present the cashier with a barcode. Users can simply pay their bills via cash, without any friction. This seamless, cash-to-digital solution is a convenient option for their customers.
2. Finnu | Asset-backed credit lending
SpeedInvest Description: Finnu is a Fintech startup in the asset-backed lending space using hybrid credit scoring models and mobile device management technology (MDM) to provide affordable credit to the unbanked underserved adult population in emerging markets via its mobile application.
They are on a mission to improve Financial Inclusion, provide affordable credit to any borrower with a smartphone and, ultimately, improve its financial health.
Why I’d Invest: It’s no secret: Latin America is fintech’s hottest market right now. So many startups are looking to be that final chess piece in the long winded game of financial inclusion. Some believe neobanking is the final move but others like Finnu, believe that LendTech is a more viable option. Finnu lends against their users smartphones, without physical custody. “In a nutshell, we have the capacity to remotely limit the device usage in case of a missed installment. In exchange, we offer loans with higher acceptance rates and lower interest rates compared to other digital lenders.”
What I like about this solution is that they are tapping into the financial education aspect of this market. They understand that borrowing is not really an option for many people due to insufficient financial data. They are building solutions/applications that can discern the financial health of a customers by adding physical collateral to the digital consumer loan setup.
Midas | Cash-based Loyalty Rewards (AdTech/Fintech)
Blazer Description: MIDAS is a platform that gives users an added value to their cash purchases by generating “MIDAS” loyalty points which can later be traded for more products or services. Through this process, we collect consumer information and trends, developing a clear “cash consumer” profile. Through our data engine, we are able to provide key insights on the “cash consumer” for producers and retailers, and start providing financial services to the cash (informal) consumers.
Why I’d Invest: I love ideas that are counter-intuitive. Midas is quite literally that. Wait what? They are encouraging the use of cash? Por supuesto! After having one conversation with the founders of Midas, I was convinced that they working on something truly unique. Midas wants to bring an added value to the cash of the Mexican consumer. We have yet to see a solution that caters the latam’s consumers preferred method of payment. Midas will be the first.
Dataplor | POI & SMB data to expand into emerging markets
Dataplor Description: Dataplor is a data intelligence company helping clients win in emerging markets. High economic growth rates in emerging markets make them attractive revenue growth opportunities for all industries. Unfortunately, business data in these countries is traditionally unreliable or does not exist, creating a challenge for companies looking to expand into these regions. dataPlor solves this problem by delivering high quality insights on small to medium sized emerging market businesses by combining a local on-demand workforce with field-ready software to collect, verify, and augment premium insights at scale.
Why I’d Invest: 80% of Mexican businesses don’t have any digital footprint, and less than 5% of businesses have a website. Imagine a company like Uber trying to expand the Uber Eats platform into smaller, more remote communities in Latin America. Where and how can Uber find the necessarily data/information on these merchants? If there’s no website, there’s essentially no business. Without digital footprints these merchants are missing out on lucrative opportunities.
5. Ábaco Latam | Democratizing the financial market for gig economy workers
Latamlist Description: The Ábaco software analyzes the financial profile of customers affiliated with delivery platforms or freelancers to identify their behavior and builds them a credit history. They then grant ‘microcredits’ ranging from $5,000 to $50,000 with extremely low-interest rates.
Why I’d Invest: I think it’s fair to say that freelancers and gig economy workers are an undeserved customer. There not as valuable to banks as salaries workers are. “The traditional banking system works on a basis of credit scores that don’t take into account the particular situation of those who work in the gig sector. Financial inclusion is only possible through a consideration of the personal labor situation of each customer to determine their financial needs,” said Victoria Blanco Alegria, founder and CEO of Abaco. This solution will open up many opportunities for those who have been historically rejected access to banking credit.
👩💻 Please share your thoughts! I’d love to hear from you!
