The document analyzes fintech investment and deals in Latin America in 2020. Some key points: - Total fintech investments in Latin America reached a record $3 billion in 2020, up from $2.64 billion in prior years. - Brazil accounted for the majority (75.8%) of investments, followed by Mexico (13.8%). Neobanks, payments, and digital banking were the most funded sectors. - There were 9 mega-rounds (over $100 million) in 2020 compared to 6 in 2019. This included 5 new fintech unicorns. - Mergers and acquisitions also grew, with 26 deals in 2020 compared to 16 in 2019. The largest was Stone's $

1. Thiago Paiva
FINTECHMARKETINLATINAMERICA2020:
Investmentanddeals
By Thiago Paiva

2. Thiago Paiva
1. Intro
2. The Author
3. Fintech Ecosystem
4. Investments
○ Total Investments in the Region
○ Investments per Country
○ Investments per Month
○ Investments per Industry Segment
○ Main Investments Rounds
○ Most Active Investors in Fintech
○ Debt Financing Deals
5. Merger & Acquisitions
6. Final Thoughts
7. Resources
○ Fintech Radars

3. Thiago Paiva
First of all, thanks for reading this material! My name is Thiago Paiva and I'm a fintech entrepreneur, investor,
and columnist. I've been working with startups and innovation for the past 9 years in Latin America, US, and
Singapore.
I have invested and accelerated more than 60 startups from which more than 20 were fintech startups from 8
different countries while working at Wayra in Brazil and Startupbootcamp Fintech in Mexico.
Since I started to invest in fintechs, in 2013, the market radically changed. In less than 7 years, we saw the birth
of the first fintech unicorns in the region, as well as IPOs from Stone (NASDAQ) and Pagseguro (NYSE) in the US.
My goal with this report is to shed some light to the fintech ecosystem in Latin America that has been
under-appreciated for a long time but that has been showing its huge potential in the past few years.
Finally, if you like this material, please, share it!
Thiago Oliveira de Paiva

4. Thiago Paiva
I'm a fintech entrepreneur, investor, and columnist! I have been actively engaged
in the Latin American ecosystem since 2010. During this period, I have evaluated
2,600+ and invested in 60+ startups from 9 different countries while working at
Wayra Brazil and Startupbootcamp Fintech Mexico. I studied Fintech at MIT and
Business with Concentration in Finance at UCLA.
I write about fintech in Latin America in international and regional publications
and also develop reports analyzing the ecosystem.
I'm currently a Product Manager at Oyster Financial, a Neobank for SMEs in
Latin America. I'm also a TechCrunch contributor.

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Andreessen Horowitz, Sequoia Capital, SoftBank, and
more) Monashees and Kaszek
half of its population as unbanked with the marked still controlled by large financial
institutions oligopolies
Source: The Mobile Economy Latin America and the Caribbean 2018

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200
441
Source: Fintech Radars from Finnovista and Fintechlab Fintech Radar Brazil
Brazil (771) and Mexico (441) remains the two
strongest fintech ecosystems in the region.
771
110
112

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9. Thiago Paiva
Source: https://fintechauscensus.ey.com/2019/Documents/ey-global-fintech-adoption-index-2019.pdf
Consumer Fintech Adoption Index - EY
Average
64%
Latin America is one of the regions with fastest
fintech adoption, according to EY Consumer
Adoption Index 2019.
It had 3 countries in the Top 10 (Colombia, Peru,
and Mexico) and all of the largest economies
above the average, 64%, of the 27 researched
countries.

10. Thiago Paiva
● BR - Nubank (US$ 1.2B): The largest neobank outside of China with more than 20M customers, worthing US$ 10 billion;
● BR - Creditas (US$ 569M): A secured online loan to consumers;
● BR - Neon (US$ 420.3M): A neobank with personal and business account;
● BR - Quinto Andar (US$ 335M): An unicorn proptech that facilitates the rent of properties by offering financial services;
● BR - Loft (US$ 263M): Is a proptech that facilitates the purchase and sale of properties;
● UY - dLocal (US$ 207M): Is a cross-border payment processor;
● AR - Ualá (US$ 194M): Neobank for personal accounts;
● MX - Clip (US$ 160M): A card payment provider similar to Square;
● BR - Conductor (US$ 150M): Is a banking-as-a-service infrastructure provider;
● MX - Konfio (US$ 143M): An unsecured online loans to SMEs;
● MX - AlphaCredit (US$ 125M): A digital credit provider for individuals and SMEs;
● BR - Acesso Digital (US$ 117.6M): A KYC provider using facial recognition and biometrics;
● MX - Albo (US$ 72.1M): A neobank for personal accounts;
● MX - Agibank (US$ 72M): A neobank for personal accounts;
● MX - Bitso (US$ 66.4M): A cryptocurrency exchange;
● BR - GuiaBolso (US$ 66M): PFM and lending, similar to Mint;
Source: Crunchbase and startup press releases
* Only equity deals were considered

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● Neobanks are starting to diversify: There are already 3 neobanks unicorns and they are starting to
offer more financial products such as investments and insurance to increase their revenue streams
and compete directly with large banks.
● Neobanks for SMEs: After the neobanks disrupted the retail market, we're starting to see some
neobanks focusing on the underserved SME market;
● Consolidation: With some fintechs raising mega-rounds and others struggling due to the pandemic,
we're starting to see more and more M&As;
● Mexico and Colombia are taking off: Even though Brazil is still the largest fintech market, Mexico
and Colombia are growing steadily and we should expect larger rounds on those countries;
● Local VCs are expanding investments: Local investors are starting to expand their boundaries and
investing in other countries, even outside of Latin America;
● Proptech is expanding beyond Brazil: After the success of Loft and QuintoAndar, proptech is
expanding to other countries in the region;
The fintech ecosystem in the region is evolving and changing quite fast; here are some of the
emerging trends seen in the region:
Source: proprietary data from deals

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more than 150% average
compound annual growth until 2019
the region reached a total of US$
4.2 billion raised in 430 equity deals
US$ 3 B
(US$ 2.64 B in equity and US$ 367 M in
debt)
Source: Data from LAVCA (2011-2018), Crunchbase (2019) and proprietary data

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US$ 3 B (US$ 2.64 B in equity and US$ 367 M in debt)
Source: proprietary data from deals

15. Thiago PaivaSource: proprietary data from deals
Brazil led the investments in
the region
Mexico (26.6%) and Colombia (10.1%)
, .

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Brazilian fintechs captured an impressive
75.8%
Mexico remained in the second
position with 13.8%
Source: proprietary data

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January and February were the
prefered month to disclose their rounds
Source: proprietary data

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Payments & Remittances and Digital Banking were the
most actives with 19 deals each (17.4%) digital banks raised most of the total amount
raised with US$ 1 B, representing 38.7%
Source: proprietary data

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US$ 125 Million
(MX - Jan 20)
US$ 175 Million
(BR - Jan 20)
US$ 300 Million
(BR - Sep 20)
US$ 200 Million
(UY - Sep 20)
US$ 248 Million
(BR - Dec 20)
US$ 255 Million
(BR - Dec 20)
Source: proprietary data. Selected investors in the round
US$ 170 Million
(BR - Nov 20)
US$ 300 Million
(BR - Jun 20 )

20. Thiago PaivaSource: proprietary data
9 mega-rounds (investments over $100 M)
compared with 6 on the previous year 5 new fintech unicorns

21. Thiago PaivaSource: proprietary data
TOP 10 deals accumulated 74% of the
total volume of equity investments of the total 101 deals

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GROWTH-STAGE
Local Foreigners
BRAZIL
MEXICO
CHILE
EARLY-STAGE
ARGENTINA

23. Thiago PaivaSource: proprietary data
11
9
7
6
5
5
4
4
4

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Mexico led in the region with US$ 219.2 M, 59.7% of all amount in disclosed debt financing
and 50% of all deals.
Source: proprietary data

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In 2020, even with the pandemic, we had a 100% growth of fintech
M&As compared to the previous year.
By far, the most active market was the Brazilian one, with most of the
26 deals announced
Stone
acquired Linx by an astonishing amount of US$ 1.4 billion
Nubank and Neon acquiring EasyInvest
and Magliniano
Source: proprietary data

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Brazil led in the region with 22 deals, 84.6% of all disclosed M&A deals involving
fintechs on a total of US$ 1.53 billion.
Source: proprietary data

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Acquired by Neon
Undisclosed amount (Jul 20)
Acquired by Magazine Luiza
US$ 55.6 million (Dec 20)
Acquired by Linx
US$ 31.5 million (Jan 20)
Acquired by Ame
US$ 6.6 million (Dec 20)
Acquired by Stone Co. (STNE)
US$ 1.4 billion (Nov 20)
Acquired by Nubank
Undisclosed amount (Sep 20)
Source: proprietary data

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Acquired by Despegar
Undisclosed amount (Ago 20)
Acquired by VISA
Undisclosed Amount (Nov 20)
Acquired by Konfio
Undisclosed amount (Dec 20)
Acquired by XP Investimentos
Undisclosed amount (Jun 20)
Acquired by Fondeadora
Undisclosed amount (Dec 20)
Source: proprietary data
Acquired by Greensill Capital
Undisclosed amount (Jun 20)

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The year 2020 was a quite challenging one for everyone worldwide, especially in Latin America.
the actual scenario was quite different than expected.
the fintechs in the
region were able to raise more than US$ 3B hitting a record number
This, together with traditional players entering the market, led
2020 to a record number of M&As

32. Thiago Paiva
we should expect the M&A deals to grow even more this year, seeing a couple more new unicorns
the Brazilian neobanks will cause real damage to traditional players' customer base
Credit fintechs will need to improve their underwriting capabilities or diversify the type

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● Report:
○ Fintech Investment Report Latin America 2019
○ Banking and Fintech Market in Latin America 2019
○ Fintech Investment Report Latin America 1H2019
○ Fintech Investment Report Latin America 3Q2019
○ Fintech Market in Singapore 2018
● Articles:
○ Techcrunch - The Emergence of Super Apps in Latin America
○ Techcrunch - The Battle to Become the Mexican Nubank Just Started
○ Techcrunch - A Look at Latin America's Emerging Fintech Trends
○ LatamList - Meet the Candidate to Become the Mexican Nubank

35. Thiago Paiva
● Latin America Digital Transformation Report 2020
● LAVCA Report - Latin America Startup Heatmap
● GSMA Intelligence Report - The Mobile Economy Latin America and the caribbean 2018
● Finnovista Fintech Radar Mexico 2020
● Fintechlab Fintech Radar Brazil 2020
● Finnovista Fintech Radar Colombia 2019
● Finnovista Fintech Radar Argentina 2018
● Finnovista Fintech Radar Chile 2019
● ALLVP - Early Stage VCs Active in Latin America
● Crunchbase
● EY Fintech Adoption Index 2019

36. Thiago Paiva
Source: Finnovista Fintech Radar Mexico 2020

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Source: Fintechlab Fintech Radar Brazil 2020

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Source: Finnovista Fintech Radar Colombia 2020

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Source: Finnovista Fintech Radar Argentina 2018

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Source: Finnovista Fintech Radar Chile 2019

41. Thiago Paiva
THANKSFORREADING!
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