Venture Capital exists to efficiently allocate capital to founders executing ideas that can reshape entire industries. Hence, the way a fund deploys and returns that capital should enable said growth. However, the mechanics of fund structures have not kept pace with the dynamic landscape of private markets.

Why Companies Can Now Stay Private for Longer

The rise of growth equity as a distinct asset class flushed the markets with liquidity that hadn’t existed before. Capital raised by mid to late-stage companies grew from US$15.7 B in 2016 to over US$114 B in 2025 and accounts for 40% of all venture financing. Such an abundance of late-stage capital gave founders the option to defer their IPOs and capture value privately.

In addition, the growing popularity of secondary markets has reduced the pressure founders felt from VCs looking for an exit through IPO. That’s largely because platforms like Nasdaq Private Market, where investors can find buyers willing to acquire startup shares (typically at a discount) and give VCs a way to cash out on their own timeline, rather than waiting for the company to go public.

Lastly, going public imposes significant compliance requirements that demand dedicated resources. KPMG estimates average annual compliance costs reached US$2.3 MM in 2024, money that buys a founder nothing they can’t already get privately, given how readily growth equity is available today. Faced with that choice, founders are choosing to put the money into scaling the business instead.

The VC Time Horizon Mismatch

There are transparent forces driving the change in the age of companies to IPO over the last 20 years, yet early-stage VCs have kept operating and raising funds on the same 10-year horizon, as if liquidity events still stood within that time frame. This time horizon was popularized by lawyers at Wilson Sonsini Goodrich & Rosati, who standardized limited partnership agreements through the 1970s. At that time, the 10-year horizon was a reasonable fit, as the median age of a venture-backed company at IPO was around 6 years, leaving partners ample room to invest and exit within the fund’s life.

As a result, fund life extensions are now standard practice, and most Limited Partnership Agreements in developed markets already include two one-year extensions. According to CFA Institute and PitchBook data, roughly 80% of funds still require beyond 12 years to fully liquidate, and only 7% liquidate within the traditional 10-year time frame. A 2026 Stanford Law School study by Bartlett and Ramella found that 47% of 2005-2009 vintage funds were still distributing capital after 15 years, up from 27% for 1995-1999 vintages two decades earlier, nearly a 75% increase.

Successful Companies Now Take Longer to Mature

SpaceX, ByteDance, Stripe, and Databricks all have something in common: they all stayed private for more than 12 years, long enough that no 10-year fund could have captured the value in full. Sequoia invested in Stripe in 2010, and a16z invested in Databricks in 2013 and keeps investing in follow-on rounds today. But of every company on that list, none makes the case for patience like Peter Thiel’s Founders Fund and its 2008 investment in SpaceX.

Founders Fund was SpaceX’s first institutional backer in 2008 with a US$20 MM investment, made when the company had just suffered three consecutive Falcon 1 failures and was near-bankrupt. The firm has kept backing each stage of the business ever since, from rocket launches to Starlink to data centers. The position illustrates a deliberate conviction strategy: identify transformative technology companies early, maintain ownership through liquidity windows, and resist pressure to distribute prematurely.

What’s more important is that 97% of the value came after the 10-year deadline. Founders Fund would have exited the position in 2018 at the 10-year traditional deadline at a US$24.5 B valuation. It was only because of a combination of patience and conviction that the fund was able to return an 80x MOIC to its investors, who were the ultimate beneficiaries of that patience. Its limited partners base is reported to include endowments such as Duke and Stanford, life insurers such as New York Life and Zurich, and foundations such as the Mellon Foundation, all of which held on past the point where a standard ten-year fund would have already cashed out.

In 2021, Sequoia’s partner Roelof Botha decided to take a stance and change the way the fund operated. “As chips shrank and software flew to the cloud, venture capital kept operating on the business equivalent of floppy disks”, he said. Thus, the fund transitioned into an evergreen structure, which has a permanent capital base with no fixed termination date, and where periodic tender events let LPs choose to cash out or roll their stake forward. Such an investment vehicle has allowed Sequoia to support founders without the time frame constraint, while offering liquidity to limited partners at the same time.

Latin America’s Current Reality

Global GP-led secondaries (transactions where a GP creates a continuation vehicle to hold a trophy asset longer while still giving LPs an exit) hit a record US$115 B in 2025, up 53% year over year and equal to roughly 48% of total global secondary market volume, according to Jefferies’ Global Secondary Market Review.

Latin America accounts for about 4% of the global GP-led transaction value, according to a 2026 study by Nicolas Santana and the International Bar Association. This figure tells an interesting story when put into context with the fact that LatAm’s share of global VC activity in 2025 was roughly 1%. LatAm accounts for roughly 5 times more of the world’s GP-led secondary activity than it does of the world’s VC activity generally.

Spectra Investments’ (one of Brazil’s most established secondaries specialists across VC, PE, and special situations) deepening its allocation into secondaries is a clear example of how often GPs are forced to find liquidity through these transactions. The asset manager closed its sixth flagship vehicle at US$302 MM, with 45% of that capital dedicated specifically for secondary transactions, a larger allocation than any of its five prior funds.

The need for investment vehicles that give GPs room to operate, LPs sustained returns, and businesses uncapped growth is clear, and Brazil’s market shows how far the region is still from it. The direct fix is already available, and mature markets are already using it: a longer fund term, without a secondary buyer in between.

IGNIA is built around the premise of supporting businesses capable of reshaping entire industries, even if they take fifteen to twenty years to fully express their value. We believe the terms of a fund should be adjusted to match the actual timeline of the businesses it backs, not the other way around.

At IGNIA we invest in global, early-stage founders building technology solutions that address fundamental pain points in emerging markets. We look for businesses where the right team sees a structural gap before anyone else does and has the conviction to build the infrastructure to close it. Checker is exactly that, which is why we are proud to participate in their US$8MM Seed round.

The problem

Cross-border payments move US$194 Tn a year, yet they remain among the slowest and most expensive operations in global finance. Stablecoins promised to change that, and in many ways they have. The problem is convertibility: getting money into stablecoins and converting it back into local currency. Every financial institution that wants to use stablecoins must integrate separately with exchanges, OTC desks, and local providers across each corridor. The result is fragmented operations, manual treasury workflows, and an operational burden that makes scaling across geographies genuinely difficult.

Why Checker stands out

Checker solves this with a single API that aggregates 50+ providers across 75+ currencies. Banks, fintechs, neobanks, and remittance platforms integrate once and gain access to intelligent routing that selects the best available provider for each transaction based on price, speed, and reliability. Checker never holds client funds and does not compete with its own customers, which is precisely what allows it to serve as neutral infrastructure for the entire ecosystem.

Five months after generating its first revenue, Checker had reached US$4 Bn in annualized transaction volume, where more than 60% of its top ten clients already depend on Checker as their primary conversion channel, including Rail (recently acquired by Ripple), Braza Bank in Brazil, or Littio in Colombia.

A market at an inflection point

Stablecoins represent less than 1% of cross-border flows today but could capture more than 12% by 2030. Regulatory clarity is accelerating adoption: MiCA in Europe, the GENIUS Act in the US, and new frameworks across Africa are giving institutions the confidence to build on digital rails. Strategic acquirers are moving fast. Stripe bought Bridge for US$1.1 Bn and Mastercard agreed to acquire BVNK for up to US$1.8 Bn. The infrastructure layer is the most valuable position to hold as this market scales.

The Team

At IGNIA we invest in founders first. Justin McMahan served as CFO/COO at Abra, an IGNIA portfolio company, and as Global Treasurer at Tower Research Capital. Nathan Crocker scaled Galaxy Digital’s engineering team from 3 to 60 as Deputy CTO. Mike Zaczyk led 24/7 global trading operations at Abra across LATAM, EMEA, and APAC. Jack Chong was among the first to tokenize bonds in Europe, working directly with regulators and major banks. Together they bring over 70 years of experience in trading, treasury, and digital asset infrastructure, and the credibility to build the category’s defining network.

We are excited to support Jack, Justin, Mike, Nathan, and the entire Checker team as they build the infrastructure that makes stablecoins truly usable for financial institutions around the world.

IGNIA invested in Backchannel because Guillermo Freire and Guillermo Arslanian are solving one of Latin America’s most stubborn retail problems: brands have no reliable way to move inventory that does not sell. They are building the infrastructure to fix it.

Excess inventory is one of the most persistent costs in consumer retail. Every season, brands bet on demand, and no forecasting tool can fully account for a missed campaign, a shift in taste, or an external shock. In Latin America, there has never been a reliable, brand-safe way to move what does not sell.

According to IHL Group, global overstocks cost retailers US$562 BN in 2023, while out-of-stocks cost US$1.2 TN.[1] The existing options all fall short: traditional liquidation destroys margin, discount platforms erode brand equity, and informal brokers offer neither the transparency nor the reliability global brands need.

Why Backchannel stands out

Backchannel lets global consumer brands sell excess, discontinued, or aged inventory to a vetted network of LatAm retailers without damaging their brand. Sellers set their own pricing, approve buyers one by one, and can list anonymously when they choose. Logistics, payments, and compliance are handled by the platform.

On the other side, Backchannel opens a fragmented base of buyers that traditional distribution overlooks, converting what used to be a dead end into a recurring revenue stream.

Early validation from the right customers

Backchannel launched in Brazil in early 2025 and is already working with Puma, Diadora, Levi’s, and Nike (brands that do not take chances with how their inventory moves). GMV is climbing quickly, retention is strong on both sides of the marketplace, and contribution margins are healthy.

“With Backchannel, we’re finally making money from our excess inventory.”
- Sales Director, PUMA Group

Why we invested

At IGNIA we invest in founders first. Guillermo Freire and Guillermo Arslanian previously built Trocafone, a B2B2C refurbished-electronics marketplace that scaled across Brazil and Argentina to nearly US$100 MM in revenue.

They understand that liquidation is never just about moving units: for brands, it is about pricing, channels, and reputation. Few teams are better equipped to build the category-defining platform.

We are excited to join Backchannel’s Series Seed round, led by Sunna Ventures, alongside Cathay Innovation, Accion, Savia Ventures, Preface Ventures, Latitud, Positive Ventures, and Norte Ventures. Congratulations to Guillermo Freire, Guillermo Arslanian, and the entire Backchannel team as they reshape how excess inventory moves across the region.

[1] IHL Group, “Retailers and the Ghost Economy: $1.77 Trillion Reasons to Be Afraid,” 2023.

MiSalud was founded to address one of the most persistent inequities in the U.S. healthcare system: access to primary care for working-class Americans. Although most employers offer health insurance, millions of frontline workers still face language barriers, inflexible schedules, limited transportation, and low trust in traditional providers. The result is chronic underutilization of preventive care and a disproportionate reliance on emergency rooms for issues that could be resolved through timely primary care, raising costs for employers, and worsening outcomes for employees.

MiSalud delivers a virtual-first, bilingual care platform designed around these realities. By pairing Mexico-based health coaches with U.S.-licensed physicians in a single app, MiSalud removes the linguistic and cost frictions that prevent workers, particularly Spanish-speaking and blue-collar employees, from accessing care when they need it. The service includes same-day acute care, chronic-condition management, mental-health support, and nutrition counseling, offering employers a scalable way to improve workforce health and reduce avoidable utilization.

The market opportunities are substantial. Out of ~163 MM workers in the U.S., an estimated 25 MM belong to industries such as agriculture, manufacturing, logistics, food service, and construction, sectors where employees struggle the most to navigate the healthcare system. MiSalud directly targets this underserved population with a culturally adapted, employer-aligned solution. While many telehealth platforms offer generalized care, few are purpose-built for the linguistic, cultural, and behavioral realities of these workers. MiSalud is already supporting 21 K+ covered lives, and the platform’s nearshore operating structure enables attractive economics as it scales—delivering a high-touch care experience while keeping costs structurally lower than traditional models.

A unique differentiator lies in MiSalud’s emerging data and AI capabilities. Through thousands of structured bilingual consultations, the company is building the Hispanic Health Index, a proprietary dataset designed to improve understanding of how conditions present and evolve among Hispanic populations. This resource, combined with MiSalud’s internal AI assistant that streamlines clinical workflows, positions the company to power future partnerships with insurers, public health organizations, and life-science companies seeking better representation and more culturally precise treatments.

MiSalud is led by a seasoned, mission-driven team. CEO Bismarck Lepe brings deep experience building and scaling global technology companies, having previously been one of Google’s early employees and founded Wizeline and Ooyala. COO Wendy Johansson, who cofounded Wizeline alongside Bismarck and helped scale Ooyala, has built user-centered digital products at organizations such as Amazon, Publicis Sapient, and AppNexus across Silicon Valley and Mexico. The team is further strengthened by Dr. Richard Boxer (Board Member & Interim Chief Medical Officer), a nationally recognized physician and health policy leader with +40 years of experience, and former Chief Medical Officer at Teladoc, where he helped scale clinical operations to 5 MM members.

Together, their expertise in product, technology, and go-to-market, paired with seasoned clinical leadership, has enabled MiSalud to execute with discipline and drive growing adoption.

IGNIA is proud to have led MiSalud’s $5.5 MM investment round and support its mission to expand access to high-quality, culturally competent healthcare for millions of workers and their families. With this new capital, MiSalud plans to scale its product and go-to-market capabilities, support the rollout of its new distribution partnerships, and accelerate growth while maintaining a disciplined path toward profitability. We are excited for the road ahead and look forward to accompanying Bismarck, Wendy, and the entire MiSalud team in this journey.

As 2025 comes to an end, we would like to sincerely thank everyone who has been part of our journey this year—especially our investors for your continued trust and support, and our portfolio founders for allowing us to be part of your growth. We wish you a year ahead filled with success, prosperity, and new opportunities. The entire IGNIA team sends our warmest holiday wishes!

IGNIA Portfolio Highlights

2025 was a year of continued execution and new investments for IGNIA, as we remained focused on partnering with exceptional technology founders solving fundamental challenges across Latin America and beyond.

Our portfolio entrepreneurs remain at the core of everything we do. We are deeply proud of each of them for their resilience, ambition, and ability to build through complex market conditions. Their perseverance and momentum give us strong confidence in the opportunities the year ahead will bring.

This year’s new additions to our portfolio include the following:

In May Monato raised a $13 MM Seed round, with IGNIA participating to support the Company’s mission of enabling seamless embedded payments, transfers, and credit across Mexico.

Also in May, IGNIA participated in Digitt’s $10 MM Series A round, backing the Company’s mission to break Mexico’s revolving credit debt cycle by offering fair, fixed-term refinancing solutions to creditworthy consumers.

In October IGNIA led MiSalud’s $5.5 MM round, supporting its bilingual, virtual-first primary care platform serving U.S. Hispanics through culturally aligned and technology-enabled healthcare.

Beyond our new investments we were pleased to lead follow-on rounds in 2025 for Kontempo, Fairgen, Uplifted, nocnoc, Worky, Reuse, and Polaroo. We also continued supporting Aviva, Escala, and Fondeadora through additional follow-on participation, reaffirming our long-term confidence in their teams and their trajectory. This strengthened support is grounded in results: last quarter, 90% of IGNIA VC Fund II portfolio companies achieved over 20% revenue growth year-on-year.

This year we were also able to successfully complete our exits from Apli and Kinedu, marking the close of two long-standing portfolio journeys. Apli is an end-to-end recruitment automation platform that helps enterprises digitize their hiring process from candidate sourcing to interview scheduling and was acquired by a U.S. talent acquisition software provider. Kinedu is a digital parenting platform that empowers families with personalized tools, daily activities, and expert content to support early childhood development. We are grateful to both founding teams for their partnership over the years and wish them continued success in their next chapters.

Last but not least, as part of our broader efforts to reinforce our engagement with the entrepreneurial and investment ecosystem, the IGNIA team participated in Mexico Tech Week 2025. The week provided a valuable platform to exchange perspectives with founders, operators, and investors on the evolving dynamics of innovation and technology across the region.

None of this year’s progress—for IGNIA or for the founders we back—would have been possible without the trust, collaboration, and shared commitment of our investors, entrepreneurs, and partners. As we look ahead to 2026, we do so with optimism and momentum. The challenges we faced this year have only reinforced our determination to keep pushing boundaries, supporting innovation, and enabling long-term growth across Latin America and beyond. We remain firmly committed to partnering with entrepreneurs who are addressing fundamental problems with bold, transformative solutions, and we are excited to continue building alongside you in the year ahead.

Here’s to a strong and impactful 2026—we’re excited for what’s to come!

Warm regards,

The IGNIA Team

Digitt is tackling this inefficiency head-on. The Company offers an amortizable refinancing option that pays off high-interest credit card balances and replaces them with fixed-term loans aligned to the borrower’s cash flow capacity. Digitt provides customers with transparent, fairly priced credit and a clear path out of revolving debt. Built with an AI-native underwriting engine and backed by institutional funding, Digitt combines discipline in credit with scalable technology.

Digitt is led by David García (Co-Founder & CEO), a third-time entrepreneur who founded the company after personally experiencing the challenges of Mexico’s consumer credit system. His co-founder, Manuel Álvarez (COO), adds operational and investment expertise from YNG Ventures along with a background in manufacturing and product development. Together with a seasoned team, they bring the vision, discipline, and credibility to transform consumer credit in Mexico.

At IGNIA, we back companies solving meaningful problems in Latin America. Many responsible borrowers in Mexico, despite having stable incomes and strong repayment histories, are still trapped in expensive revolving credit. This problem will only grow as more consumers enter the financial system and face the same debt flywheel. Digitt is changing this by providing prime and near-prime consumers with transparent, affordable alternatives that give them a clear path out of debt.

We are proud to participate in Digitt’s US$10 MM Series A round. Congratulations to David, Manuel, and the entire Digitt team. We are excited to support you in building fair, transparent, and scalable credit solutions for Mexico’s emerging middle class.

[1] According to Banco de Mexico

[2] According to the banks’ websites (HSBC, BBVA, Banamex, Santander, and Banorte).

Embedded finance is one of the most important macro trends shaping fintech today. By integrating payments, lending, insurance, and other financial services directly into their products, companies are turning finance into an invisible but essential part of the customer experience. This shift improves convenience for end users, from “buy now, pay later” options at checkout to instant payouts for gig workers and cash networks. It also creates powerful business advantages, opening new revenue streams, strengthening margins, and enhancing customer loyalty by making financial interactions seamless, contextual, and value adding.

Financial infrastructure in Mexico is heavily regulated, fragmented, expensive, and outdated. For most companies, embedding payments, transfers, or credit into their products means navigating complex regulations, negotiating with multiple providers, and spending months on integration. As a result, only the largest players can afford to offer digital financial services at scale.

Automating Payments, Transfers, and Credit Through a Single Platform

Monato is transforming the current landscape by giving companies the ability to seamlessly offer their clients payments, real-time transfers, and credit through a single, fully compliant platform. From retail chains to software providers and lenders, Monato enables businesses to make financial services a core part of their value proposition—and a powerful tool to boost customer retention.

The impact is already visible. Thanks to Monato, a small shop owner within a large distribution network can now receive payments, send money, and pay invoices in real time. This strengthens their cash flow, improves day-to-day operations, and gives the parent company full visibility and control over financial flows. Monato goes beyond digital payments by empowering large organizations to fully digitize their financial value chain and deliver seamless solutions to their customers.

Adoption is growing quickly. Monato is already processing millions of transactions per month and has signed partnerships across multiple sectors. The Company started with payments and is now rolling out real-time transfers and embedded credit. Each new product adds more value for clients while strengthening Monato’s infrastructure advantage.

In other parts of the world, embedded finance has already reshaped how businesses operate—from digital wallets in Southeast Asia to financial APIs in the United States. Mexico has entered a similar phase: real-time payments are gaining traction, digital adoption continues to accelerate, and new regulatory pathways are making it easier for companies to offer financial products directly to their users. With businesses seeking to integrate payments, credit, and treasury management into their workflows, Monato stands out as one of the few platforms with the vision and infrastructure to meet that demand.

An Experienced Founder and a World Class Team

Monato is led by Iñigo Rumayor, a second-time founder with deep experience in Mexico’s fintech ecosystem. After building Arcus—a payments platform backed by IGNIA and later acquired by Mastercard—he not only mastered navigating Mexico’s regulatory landscape and financial infrastructure but also learned the importance of surrounding himself with top talent. Today, Iñigo is leveraging a decade of experience across banking, payments, and regulation to assemble a world-class team that combines vision, execution, and network, bringing top talent from companies like RappiCard, Citi, Wise, and Arcus. He knows where the blockers are—and more importantly, he’s building the right team to overcome them and scale Monato into a category-defining company.

Backing the future of payments in Mexico

At IGNIA, we back companies solving foundational challenges. Monato is building the financial infrastructure set to power the next wave of innovation in Latin America. We’re excited to participate in their US$13 MM round led by Monashees and Fintech Collective, alongside Angel Ventures, Polymath Ventures, Clocktower Ventures, Kuiper, NOA Capital, and a group of angel investors.

Congratulations to Iñigo and the entire Monato team—we’re thrilled to support you as you scale, innovate, and redefine Mexico’s digital payments landscape.

Car insurance in Mexico is plagued by inefficiencies, slow claims processing, outdated underwriting models, and frustrating customer experiences. The industry is dominated by legacy incumbents, whose rigid processes result in long wait times, limited transparency, and policies that often fail to align with customer needs. This has led to a low market penetration, with only 30% of vehicles in Mexico insured.

The problem isn’t just a lack of coverage, it’s that even those with insurance are often underserved. The average Net Promoter Score (NPS) for traditional insurers is just 35, reflecting customer dissatisfaction with delays and bureaucratic hurdles. In contrast, Crabi has achieved an 87 NPS, setting a new standard for service quality in the market.

Crabi is the first full-stack digital car insurer in Mexico, leveraging technology and data-driven underwriting to deliver fair pricing, faster claims processing, and an overall superior customer experience.

A Full-Stack Approach to Disrupting an Outdated Industry

Unlike other Insurtech startups that rely on third-party underwriters, Crabi controls the entire value chain, from policy issuance to claims management. This means greater pricing flexibility, more efficient processes, and the ability to directly improve customer experience.

By obtaining a vehicle carrier license, Crabi became the first new company in 30 years to secure full operational control over car insurance in Mexico. This milestone allows them to own underwriting, policy management, and claims resolution, eliminating middlemen and reducing costs while improving service speed.

Crabi’s proprietary pricing model incorporates a range of data sources, driver credit history, phone metadata, and vehicle and environmental data to generate more accurate risk assessments and lower loss ratios. Compared to traditional insurers that primarily base pricing on the vehicle itself, Crabi can offer more competitive rates tailored to individual drivers.

A Shift to B2B2C for Scalable Growth

Originally launched as a Direct-to-Consumer (DTC) insurer, Crabi pivoted to a B2B2C model by partnering with brokers, financial institutions, and car rental agencies. This move has significantly improved unit economics and scalability.

One of its most impactful partnerships is with Kuna Capital (Kavak’s leasing arm), which provides Crabi with a steady pipeline of new policies for used cars sold on credit. Crabi is also working with Dalton, Iturán, and other players in the car retail industry, ensuring a continuous flow of insured vehicles.

This shift allows Crabi to tap into the rapidly growing used car leasing market, an underserved sector in Mexico that is now integrating embedded insurance solutions into its financial offerings.

Digitizing Claims & Building a Tech-Driven Insurance Model

One of the biggest pain points in Mexican car insurance is the claims process. Traditional insurers rely on outdated methods, resulting in long wait times and poor communication. Crabi is tackling this with a digital-first approach, where 25% of its claims adjustments are now managed digitally, cutting costs and accelerating claim resolution for customers.

Additionally, Crabi has built a network of 100+ affiliated body shops, some of which work exclusively with the company. This ensures faster repair times and a seamless experience for policyholders.

Beyond claims, Crabi is also leveraging AI and automation to optimize fraud detection, underwriting accuracy, and customer support, further reducing operational costs while improving policyholder satisfaction.

A Massive Market Opportunity

The Mexican car insurance industry represents a US$25 BN market growing at 13% CAGR, despite this, only 30% of vehicles are insured. Crabi’s low-utilization policies, which cover theft and total loss, allow it to penetrate the uninsured segment with accessible, high-margin offerings. Its B2B2C embedded insurance strategy is rapidly gaining traction, resulting in US$11.2 MM in revenue for 2024.

An Exceptional Founding Team

Crabi’s leadership team is a group of seasoned entrepreneurs with deep expertise in technology, insurance, and financial services.

• Daniel Bernardez (CEO & Co-Founder) – Former CTO turned CEO, with a background in growth, martech, and product development.

• Ignacio Martínez (COO & Co-Founder) – Former Nubank executive, led Nubank’s loyalty program before co-founding Crabi.

This team has proven its ability to execute, pivot strategically, and scale a complex, highly regulated business. Their vision of creating the "Nubank of car insurance" is well on its way to becoming a reality.

Backing the Future of Car Insurance in Mexico

At IGNIA, we invest in companies that disrupt traditional markets with technology, strong execution, and innovative business models. Crabi’s ability to transform auto insurance through digitalization, proprietary underwriting, and strategic partnerships makes it a category-defining leader in the space.

We’re proud to co-lead Crabi’s US$13.6 MM round alongside Kaszek, reinforcing our commitment to backing visionary founders who are reshaping industries.

Congratulations to Daniel, Ignacio, and the entire Crabi team, we’re excited to support you as you scale, innovate, and redefine car insurance in Latin America!

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The rise of digital payments has unlocked tremendous opportunities for businesses to scale, reach global markets, and provide seamless customer experiences. However, payment processing remains a critical bottleneck for companies operating in Latin America. Businesses lose over $100 billion annually due to transaction failures, fraud, and complex payment integrations1. Companies struggle with lost revenue and customer churn in a region where one in four card transactions is declined—double the failure rate seen in the US and Europe. Payment systems are fragmented, fraud prevention mechanisms often block legitimate transactions, and merchants face long, costly integration processes just to access multiple payment providers.

For businesses looking to scale, these challenges present a critical barrier to growth and customer retention. As digital commerce in Latin America continues to grow at an annual rate of 20%2, the demand for a smarter, more efficient payment infrastructure is pressing. Businesses need a flexible, high-performing solution that improves approval rates, reduces costs, and enhances the payment experience for customers.

Enter Malga – a next-generation payment orchestrator that enables businesses to seamlessly integrate multiple payment providers while intelligently routing transactions to optimize approval rates and reduce costs. Unlike traditional gateways or outdated payment service providers (PSPs), Malga’s low-code/no-code platform provides an agile, fully decoupled infrastructure, allowing merchants to dynamically select the best provider for each transaction without being locked into a single system.

Malga automatically directs transactions to the most efficient processor, significantly reducing declines and boosting approval rates. Businesses can connect to multiple payment processors via a single, modern API, eliminating months of costly integrations. The Company provides real-time transaction insights, fraud detection, and data-driven decision-making to optimize performance. Unlike competitors, Malga’s platform is fully customizable to fit the unique needs of enterprise clients.

With 61 enterprise clients already processing over $600 million annually through Malga, the company has proven its ability to drive tangible results. Businesses that switch to Malga reduce payment failures, increase revenue, and optimize operational efficiency, making Malga a mission-critical partner in the Latin American payments ecosystem.

Malga is not just solving a problem; it is reshaping how businesses manage payments in Latin America. The company’s unique approach allows businesses to escape vendor lock-in, reduce friction, and improve financial performance with a more intelligent and flexible payment system.

With over 7.2 million enterprise businesses in Latin America3, Malga is addressing a $150 billion-plus market that continues to expand. Unlike legacy players that struggle with outdated systems and competitors that only provide basic integration layers, Malga delivers deep payment orchestration capabilities, a feature-rich platform, advanced data insights, and a comprehensive suite of services, including split payments, reconciliation, and Buy Now, Pay Later (BNPL). Malga has a high-margin, recurring revenue model with strong unit economics, demonstrating its efficiency and ability to scale profitably.

At IGNIA, we are committed to partnering with exceptional companies built by exceptional founders. Malga’s leadership team has the perfect mix of payments industry expertise, operational excellence, and startup execution to take the company to the next level.

CEO Alex Vilhena is a former executive at Braintree and PayPal, Alex has over 15 years of experience helping companies scale payment infrastructures across multiple continents. His deep knowledge of the payments space enables Malga to stay ahead of market trends and technological advancements. COO Thiago Garuti is a seasoned entrepreneur with a successful exit, Thiago previously co-founded Medicinae Solutions, a fintech focused on receivables management, which was acquired in 2020. His experience in scaling financial services businesses is a huge asset to Malga.

This experienced and visionary team has demonstrated strong execution, product innovation, and a deep understanding of LatAm’s payments landscape. Their ability to navigate the complexity of the region’s financial ecosystem positions Malga as a category-defining company in payments orchestration.

IGNIA is thrilled to join Costanoa Ventures, Citrino Ventures, Gaingels, Norte Ventures, Y Combinator, and QED Investors in Malga’s $5M Series A round (link to announcement here). We see tremendous potential in Malga’s ability to transform payments in Latin America, helping businesses seamlessly integrate, optimize, and scale their payment operations. As digital commerce and fintech adoption continue to accelerate across Latin America, we believe Malga will become the go-to payments infrastructure provider for enterprises in the region.

We’re excited to partner with Alex, Thiago, and the entire Malga team as they build the future of payments. Congratulations on the latest fundraise!

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Dear IGNIA Friends,

As 2024 comes to a close, we want to express our gratitude to everyone who was part of our year. Especially to our investors for your unwavering trust and support, and to our portfolio entrepreneurs for inviting us to join your journey. We hope the next year is full of prosperity and new opportunities. The IGNIA team wishes everyone Happy Holidays!

This is also a moment to reflect on the past year and look forward to the upcoming year's opportunities.

2024 IGNIA Portfolio Highlights

2024 was a year of new milestones for IGNIA. We reached a final close of IGNIA VC Fund II in May to continue executing our thesis of partnering with global tech founders addressing fundamental pain points in LatAm.

Our portfolio entrepreneurs are our reason for being. We are incredibly #IGNIAproud of each one for their accomplishments during the past years, navigating complex market conditions and overcoming challenges in their growth trajectories. We are confident that the new year will bring opportunities to venture into new horizons.

Some notable portfolio highlights of the year include the following:

In February ProducePay reached new heights with a $38M Series D round, solidifying its leadership in agricultural financing (Read more: TechCrunch).

In April, Chilean circular economy startup Reuse closed a $4.5M Seed round, with an investment by IGNIA, to continue in its expansion as LatAm’s leader in refurbished electronics (Read more: Contxto).

In May, Israeli startup Fairgen closed a $5.5M Seed round, with IGNIA’s investment supporting their groundbreaking initiatives in generative AI for market research (Read more: TechCrunch).

IGNIA participated in Mexican HR-Tech Worky’s Series A raise in May, backing their innovative solutions to revolutionize workplace management (Read more: Why We Invested: Worky).

We co-led Novel Capital’s $15M pre-Series A round back in May, marking IGNIA’s commitment to the Company’s vision of redefining funding alternatives for tech startups (Read more: Why We Invested: Novel).

In July, Escala raised $12M in a round co-led by IGNIA, furthering its position as a leading Hispanic SMB-focused CRM (Read More: PR Newswire).

IGNIA invested in Aviva’s $5.5M Seed round in August to further enhance the credit offering experience through their ‘phygital’ solution. Aviva’s founders were recognized among Bloomberg’s Top 100 Innovators in Latin America in 2024 (Read more: Why We Invested: Aviva).

In November, influencer marketplace Influur raised an impressive $10M Series A round, with IGNIA proudly participating (Read more: PR Newswire).

This year’s milestones for IGNIA and our portfolio companies would only be achievable because of the trust, collaboration, and shared vision of our investors, entrepreneurs, and partners. Looking ahead, we are excited and optimistic for what 2025 will bring. The challenges of this past year have only strengthened our resolve to continue pushing boundaries, championing innovation, and fostering growth in LatAm and beyond. We remain committed to empowering entrepreneurs who are solving fundamental pain points with transformative solutions, and we are ready to embark on another impactful year together.

Here’s to a prosperous 2025, we’re excited about what the new year has in store!

Warm regards,

The IGNIA Team

Check out our new IGNIA website here.

Historically, Mexico's traditional banking system has left those at the base of the pyramid (BoP) with either limited access to financial products or access to products of suboptimal quality. Currently, the most common formal credit product available for BoP clients is department store credit cards, servicing 62% of adults1, and creating a heavily limited financial market. The reliance on this type of product points to a larger issue of quality access to comprehensive banking services, which can be attributed to a range of barriers, like excessive documentation requirements or inadequate geographic coverage of bank branches. According to World Bank data, the number of bank branches per 100,000 adults has historically been twice as high in OECD countries than in Mexico. Traditional banking and fintech solutions have failed to meet the BoP customers’ needs, and thus the apparent necessity for an accessible, efficient, and empathetic solution in the market. To achieve this at the BoP, we don’t believe the short to medium-term solution will be fully digital. We believe it will be hybrid; a physical presence leveraged by technology and a digital offering. Aviva has proved to us that they could address this fundamental pain point through a “phygital” (Physical and Digital) model. After spending 18 months monitoring their traction and keeping in touch, Aviva achieved every milestone previously proposed. In addition to their exceptional traction, unit economics, and low default rate, their progress led by a team of seasoned founders gave us a clear sight of Aviva’s potential and confidence in our conviction to invest.

Founded in 2022, Aviva emerges as an innovative fintech solution targeting the C and D socio-economic segments across 600+ small to medium-sized towns in Mexico2. In a country where cash still represents 91% of all small transactions3, Aviva seamlessly blends its customers’ preferences for human interactions and cash transactions with cutting-edge technology, leveraging real-time video interactions and AI. By including human interaction in a credit transaction, the customer’s willingness to pay is increased compared to a fully digital exchange.

The Company offers personal, micro-business, and home improvement loans ranging from MX$2,000 to MX$20,000 through a seamless and simple process that consists of an initial 10-minute video call at the company’s kiosks. Aviva is then able to quickly approve the loan, by measuring risk through biometric data and computer vision.

Aviva aims to serve underbanked customers in Latin America, starting with Mexico, by using face-to-face interactions to build trust and help clients make smart financial decisions. This represents a big opportunity in the market with a potential US$15.6 billion consumer credit portfolio driven by Mexico's 55 million underbanked individuals4. According to iProspect, the business opportunity grows to US$34 billion when targeting the underbanked population in Latin America which is comprised of 220 million adults.5

Aviva’s success can be attributed to co-founders Filiberto Castro, David Hernandez, Amran Frey, and Israel García. Their extensive knowledge of financial services, risk management, and technology developed in 55+ years of combined experience, delivers a fully seasoned team with the necessary foundations to scale the business. Their personal experience and deep understanding of the market’s needs have led them to turn Aviva into a first in its class fully scalable and functional solution.

Aviva’s revolutionary phygital business model can enhance credit offerings to underbanked communities in Latin America at competitive interest rates. The Company’s mission aligns seamlessly with IGNIA’s thesis of supporting companies tackling Latin America’s fundamental pain points through digitalization and technology. We share the founding team’s vision and trust that through their experience and motivation, they will guide the company to become a leading financial product that is useful to millions of people.

We are excited to partner with Aviva on their journey with our investment in their most recent Seed round. Their unique approach and understanding of the market, position them as a leader in the microlending space. We have co-invested alongside top-tier funds Wollef, 500 Global, Magna, DCG, Carao Ventures, Krealo Credicorp, and Newtopia, all of whom are complementary based on their extensive knowledge of the Fintech space, fundamental to the Company’s strategic development.

Congratulations to Filiberto, David, Amran, Israel, and Aviva’s team on closing this funding round.  

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The financing landscape for startup SaaS companies is fraught with generic, one-size-fits-all solutions. This contributes to staggering failure rates of 75%1 among startups across all sectors. Carta’s data illustrates that companies across all stages are shutting down at an increasingly higher rate2. Although this industry is highly cyclical and a boom will likely return, failure to grow is often attributed to a lack of proper funding.

Seasoned entrepreneurs and VC investors, Carlos Antequera and Keith Harrington, have experienced the challenges of securing tailored financial offerings firsthand for startups, setting out to build a solution. The result: Novel Capital, embarking on bridging the financing gap and meeting founders where they are with the information and funding they need.

Understanding that every company’s growth trajectory differs, Novel’s Capital Intelligence™ platform, driven by AI and real-time data, offers unprecedented insights and support for tech founders. Additionally, it provides growth capital with clear terms, payment plans, and no dilution. This robust analytics engine plugs directly into a company’s software suite to act as a “B2B Founder’s essential hub for fundraising, financing, and strategy across their capital stack”. This means diversifying a company’s funding sources (through equity and/or debt), to chart a clear path to profitability under varying scenarios, and designing a cohesive company strategy that aligns with the ultimate end goal. Whether that be an IPO, a strategic acquisition, or any other type of exit. With a proven product-market fit, Novel has had a solid trajectory addressing a critical market need, with 350+ customers served, over $100 million deployed, and 120% YoY revenue growth.

While only getting started, Carlos and Keith’s vision for Novel resonates deeply with IGNIA. Our thesis has long consisted of backing resilient founders with deep conviction about what they are building and partnering with companies that upend the status quo, especially when operating in large and expanding markets with fragmented solutions that currently don’t directly address the critical pain points. Novel’s Co-Founders understand the pain of building something from the ground up and are now channeling that experience to alleviate a primary challenge faced by founders: securing capital. This allows CEOs to focus on what they do best—operating and growing their businesses—without facing the constant challenges and difficulties of fundraising.

IGNIA is pleased to co-lead a $15 million Pre-Series A funding round for Novel, alongside Ulu Ventures. Our investment in Novel, announced last month, culminates a deep relationship with founders and co-investors, many years in the making. IGNIA Partner Christine Kenna got to know Carlos and Keith, and fellow investor Matterscale Ventures, extensively through the Kauffman Fellows network. Steve Reale, another Kauffman Fellow and Partner & CFO of Ulu Ventures, worked with Keith on various iterations of the Novel Capital model from the beginning.

The Kauffman Fellows has been a platform from which we’ve built a foundation of trust and shared goals. Yet, more than anything, it has enabled us to delve deeper into our convictions and understanding of what makes founders tick and attract exceptional talent. Viewed through that lens, we can confidently assert that Carlos and Keith uphold the values and attributes we most seek in founders.

At IGNIA we believe in building the future we want to see. Novel is the perfect enabler for the future: helping companies with limited financing options, maximize their prospects in reaching their fullest potential. We could not be more excited to join Novel Capital on this journey.

If you are a US-based B2B SaaS or technology company, join us on this journey, and discover how Novel Capital can redefine your growth trajectory. Empowering you to achieve your business aspirations with unparalleled financial intelligence and support. Contact us at: info@ignia.vc

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The Human Resources (HR) and payroll sector in Latin America has been plagued by fragmented and outdated processes. Businesses often rely on a combination of tools to manage different aspects of the employee journey, leading to inefficiencies, errors, and compliance risks. This disjointed approach not only burdens HR teams but also impacts the overall employee experience. Notably, 95% of businesses in this market use tools like Excel for managing HR tasks. The hybrid and remote, post-pandemic corporate environment has catalyzed a need for flexibility and streamlining of archaic HR process management to improve employees’ experience and retain talent. Additionally, the global HR SaaS industry has been rapidly growing and is expected to reach a US$62 BN market size by 2032, a 9.8% CAGR when compared to 20221.

Worky stands out as a comprehensive HR management platform designed to address the specific challenges faced by Latin American companies, in Mexico employee Churn in 2022 was 40% compared to 18% in the US, a significantly higher number2. By integrating all HR functions into a user-friendly platform, Worky eliminates the need for multiple tools, significantly reducing errors, saving time, and cutting costs. Its emphasis on compliance with local labor laws ensures that companies can confidently navigate the complexities of payroll and social security obligations. The Company is filling a massive gap by serving traditional companies that have managed HR processes manually, tapping into a US$3 BN market in Mexico alone.

The future of work demands flexibility, efficiency, and a focus on employee engagement. In 2023, Mexico’s formal employment grew 3%, with more and more employees entering the workforce, new tools are needed by firms to manage them3. Worky's platform is positioned to meet these needs, offering features such as Time and Attendance, a mobile app for employee self-service, and a dashboard for real-time analytics and management. The mobile app provides employee-centric accessibility to monitor benefits and perform other tasks seamlessly. This bridges the frictional dynamics associated with analog HR management, creating a valuable user acquisition channel. These capabilities not only enhance the employee experience but also provide valuable insights for businesses to optimize their HR functions.

Behind Worky's success is a team of seasoned professionals led by co-founders Maya Dadoo and Carlos Marina. Their combined expertise in payroll management, venture capital, and product development is the foundation of Worky’s strategic vision. This team's deep understanding of the market's needs and challenges has played a crucial role in Worky's rapid growth and its ability to deliver a best-in-class SaaS solution.

Our decision to invest in Worky was driven by key factors highlighting its capacity to revolutionize the HR tech sector in LatAm. 71.3% of employees consider technology to be an absolute requirement for HR areas, overall in payroll, recruitment, and employee education4. The region's HR tech market, ripe for disruption, presents a significant opportunity that Worky is uniquely positioned to seize with its innovative, integrated platform. This platform not only fills a critical gap by offering a comprehensive solution tailored to the requirements of Latin American businesses but also aligns with IGNIA's mission to back initiatives that foster digital transformation across the region. The experience and vision of Worky's leadership team reinforce our trust in their strategic direction.

We are excited to partner with Worky on their journey to redefine HR and payroll management in LatAm, with a follow-on investment in their most recent Series A (see BusinessWire article here). Their innovative approach, combined with a clear understanding of the market's needs, positions them as a leader in the HR tech space. Additionally, we're thrilled to join forces with top-tier co-investors such as QED Investors, AcadianVentures, Gaingels, ADP Ventures, Atlantico, Gilgamesh Ventures, BDEV Ventures, and Leap Global Partners. Their extensive expertise in HR Tech, Fintech, and B2B SaaS will significantly contribute to the Company's strategic development.

By partnering with Worky, we are investing in the future of work in LatAm. Congratulations to Maya, Carlos, and the entire Worky Team for the recent fundraise.

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The IGNIA team would like to wish you a joyful and festive holiday season. We want to express our gratitude for your unwavering support throughout 2023 and hope the next year is full of prosperity and new opportunities. This is also a moment for us to reflect on the most significant events from the past year.

I. Where We Are:

IGNIA VC Fund I (2016 Vintage)

The global VC funding slowdown and overall macroeconomic uncertainty throughout the year have indeed posed new challenges to our portfolio companies. As our IGNIA VC Fund I founders continue to navigate tough market conditions, we can’t help but feel immense pride towards our companies that are not only weathering the storm, but thriving amidst adverse conditions. The ultimate beneficiary, of course, is the LatAm end-consumer and SME—the backbone of the regional economy. Standout performers include Rapyd, Tiendanube, Covalto, Petlove, Fondeadora, UnDosTres, Finnovista, and GoTrendier during a turbulent and eventful year. Thanks to them, our fund has continued to perform strongly, ranking among the top quartile of Vintage 2016 VC funds globally according to Cambridge Associates benchmarks.

IGNIA VC Fund II (2022 Vintage)

The best startups are forged under fire, and the ecosystem’s current blaze has yielded exceptional founders building extraordinary companies. We are excited to be actively investing in such dynamic times, having made over 14 investments during the past 18 months. Kontempo, Trellis, Fertilidad Integral, nocnoc, Erudit, Worky, and Piper are among some of the recent additions to the IGNIA Family, all led by outstanding, seasoned founders. Despite the challenges ahead, we are more bullish than ever on the drive of LatAm founders. Such market conditions breed discipline into every facet of a company’s DNA, compounding over the long term and ultimately resulting in the most resilient and sustainable business models. In the inimitable words of Scottish philosopher Thomas Carlyle, “No pressure; No diamonds.”

II. 2023 Highlights

Looking back, 2023 was an eventful year. The following are only a few of the moments that made us #IGNIAproud.

In October, we hosted our first edition of IGNIA Insight Sessions, as part of Mexico Tech Week, aimed towards entrepreneurs, investors, and other key players in the ecosystem. Partner Fabrice Serfati moderated a panel discussing AI and Navigating Emerging Tech Horizons, featuring JB Rolland from Covalto, Lorena Sánchez from Erudit, and our incredible host Anibal Abarca from Wizeline. We are excited to host more IGNIA Insight Sessions editions throughout 2024.

During LAVCA Week, Partner Christine Kenna participated in a stimulating and enriching discussion on new investment themes and rising sectors in Latin American VC alongside Lorena Suarez from Alaya, Izabel Gallera from Canary, Alex Busse from NXTP, and Jonathan Whittle from Quona. LAVCA Week is always an incredible opportunity to reconnect with regional ecosystem players, including other GPs and potential LPs, to discuss the immense opportunities in our target region.

Co-Founder and Managing Partner Álvaro Rodríguez moderated a panel on DeFi during South Summit 2023 in Madrid this summer, a great representation of IGNIA overseas.

In August, IGNIA VC Fund I portfolio company Rapyd announced the acquisition of a portion of PayU, the fintech and payments group of Prosus Group, focusing on emerging markets, for US$610 MM. An impressive milestone for the Company, as it continues to expand its global presence.

Erudit’s founding team stands in front of the Nasdaq displaying the announcement of their US$10 MM Seed round, in which we participated back in August.

Partners Christine Kenna and Fabrice Serfati participated in engaging panel discussions during Finnovista’s Finnosummit 2023, Latin America’s flagship fintech event, alongside all-star founders and investors in September.

The IGNIA Investment team at our annual offsite. A great opportunity to strengthen our values, and align our mission and goals with the team.

III. What’s Next: Perspective and Outlook

Echoing perspectives expressed earlier, 2023 was an eventful and challenging year for the VC ecosystem globally, starting with a series of industry-shaking events. Latin America endured similar results, with a significant slowdown in deal volume versus 2022, not to mention against the outlying 2021, reverting to pre-pandemic levels. Regardless, startups continue to get funded in the region, with over 2,616 deals closing so far this year according to LAVCA (versus 2,393 in 2022 and 1,777 in 2021). Startups are managing to secure seemingly scarce capital, under constrained terms, reflecting adjustment rather than decadence. This makes us hopeful that the worst might be behind us, and that 2024 could be a year of recovery.

According to a survey conducted by our friends at Latitud for their 2023 LatAm Tech Report, 78% of founders and 89% of investors anticipate that the fundraising environment will get better in 2024. Pessimism about the fundraising environment has been the common denominator, however it reduced significantly versus 2022. Investors sitting on loads of dry powder will likely accelerate their deployment of capital. Yet, they will remain cautious, supporting companies with the strongest fundamentals and sustainable business models, as opposed to growth at all costs.

We are witnessing Latin America’s dynamic ecosystem come of age. Our pipeline is now riddled with repeat founders, many on their third or fourth venture. This is as good a sign as any of a healthy market where founders and seasoned operators are achieving exits and reinjecting liquidity into the ecosystem via angel investing or by starting another company. Most of these business models build on top of the foundations created by those that came before them. In our own portfolio, VC I PortCo Rapyd’s world-class financial infrastructure powers the underlying architecture of VC II PortCo Kontempo. In short, the realm of what’s possible across LatAm is being redefined every day. The future is now the present.

This year's surge in Artificial Intelligence (AI) investment has garnered much attention, and rightly so. While there's a prevailing skepticism about the tangible value emerging from the influx of funding into AI startups, particularly in saturated markets like the U.S., it's undeniable that AI has become a pivotal element in contemporary technological models. Companies that adeptly harness AI's potential are poised to distinguish themselves, gaining remarkable momentum and creating substantial value. The implications of this shift are profound, surpassing even the monumental impacts of the internet and mobile revolutions. We are at a historical crossroads, witnessing a pivotal moment in the evolving synergy between humanity and technology. The full extent of AI's transformative effects remains elusive, but one thing is certain: we are entering an era of unprecedented and, perhaps, unexpected changes.

The entrepreneurial spirit in Latin America is as vibrant as ever, and the underlying fundamentals haven't changed. The region still boasts a young, tech-savvy population, a growing middle class, a largely unbanked population, a lack of digital solutions for SMEs, frictional service offerings by incumbents, creating a vast untapped market that remain alluring prospects. As we toast the new year, let's embrace the inevitable ups and downs, knowing that the next act in this drama promises to be just as thrilling, and perhaps even more impactful.

As always, we would like to thank all of our partners, investors, and supporters for their continued trust and partnership.

Wishing you all joy, peace, and prosperity in the coming year.

Sincerely,

The IGNIA Team

The fintech sector in Latin America (LatAm) has undergone a dramatic transformation, now representing 40% of all investments in the region. The initial wave, led by companies like Nubank, Neon, and Ualá, revolutionized consumer-facing financial solutions, addressing a growing demand for personalized, digital services. This shift laid the foundation for the next frontier: the largely untapped B2B domain.

In a region where the financing gap reaches US$1.2 trillion, and over 175,000 companies engage in B2B transactions, the challenges are significant. Particularly in Mexico, with its 45,000+ companies, traditional banking structures often leave more than 80% of SME credit applications rejected, underscoring a dire need for innovative financing solutions.

Enter Kontempo. Its API platform reimagines the cumbersome net terms process, offering a streamlined, digital approach for suppliers to extend credit. This solution not only ensures immediate payment but also reduces the risks and operational costs typically associated with credit operations. For SMEs, Kontempo is more than a financial tool—it's a gateway to growth and operational efficiency, providing quick, flexible, and accessible credit.

With a strategic initial focus on Mexico's industrial sector, Kontempo's vision extends to becoming the comprehensive B2B commerce platform across LatAm. Its evolving ecosystem of products and tools is empowering SMEs and invigorating commerce throughout the region.

Our conviction in Kontempo is rooted both in its innovative business model and in the strength and experience of its founding team. Matthew Meehan, a three-time founder with a notable exit in Centeo, brings invaluable insights from the embedded financing space. Antonia Marino, leveraging her experience at Centeo, expertly developed BNPL and MCA programs for multinational partners in Mexico, after a pivotal role at Uber, where she spearheaded the company’s vehicle financing program. Kwesi Steele, with his seven-year tenure at Google, led technical sales teams across diverse regions including Asia, LatAm, and Canada. Collectively, they present a synergistic blend of skills in SME credit, embedded lending, operations, and technology, positioning Kontempo at the forefront of financial innovation.

As the inaugural investment from IGNIA VC Fund II, we are excited to partner with Kontempo and world-class co-investors, including Portage, SCOR P&C Ventures, Upper90, and Asymmetric.

We believe that Kontempo is not just a business; it's a catalyst for economic growth and a driver for the digital future of commerce in Latin America. This investment reflects our belief in the transformative power of fintech and our commitment to fostering sustainable and inclusive growth in the region. Kontempo exemplifies our thesis of investing in global entrepreneurs who are developing innovative technology solutions to address fundamental pain points in Latin America.

As B2B commerce progressively shifts online, Kontempo is poised to be at the forefront, providing essential financial infrastructure to support this digital transformation.

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As we approach the end of another year, we at IGNIA want to take a moment to extend our warmest wishes for a happy and festive holiday season. We also want to use this opportunity to reflect on what has been a memorable year and thank you - as ever - for your continued support.

I. IGNIA VC Fund I - Where We’ve Been

Proving our Investment Thesis

Our current fund — IGNIA VC Fund I — has produced exceptional returns for investors, positioning IGNIA among the top quartile of vintage 2016 VC funds globally1. This portfolio is comprised of world-class companies such as Rapyd, Fondeadora, Covalto, UnDosTres, Konfío, Lentesplus, and Tiendanube, among others. With 7 exits to date and 20 active portfolio companies, there is a significant amount of upside that remains to be captured.

One key highlight consisted of a secondary transaction completed in July, underscoring an increasingly relevant and strategic exit avenue for IGNIA and Latin America. This transaction enabled us to continue realizing distributions for our investors and improving our best-in-class fund DPI.

As a testament to the fund’s performance, IGNIA has raised US$67 MM in SPVs, including a US$25 MM fund extension to accompany our top-performing companies as they continue to scale.

II. IGNIA VC Fund II - Where We’re Going

New Beginnings 

Moreover, we have so far raised US$50 MM of our US$150 MM IGNIA VC Fund II — our latest fund focused on supporting early-stage tech startups looking to scale in Latin America. This new fund will invest primarily in Seed and Series A rounds among high-growth sectors such as Fintech, E-commerce, SaaS, Web3, Proptech, and more. We expect a final close in early 2023.

We’ve been eager to resume bringing new entrepreneurs into the IGNIA family by investing in them and their startups as we continue doing what we love: backing world-class entrepreneurs solving genuine pain points for the emerging middle class. With IGNIA VC II, we have invested in five new companies. We are excited to see the evolution and success of these businesses and look forward to further advancing the development of the LatAm startup ecosystem. 

III.  XV Year Anniversary

In mid-November, IGNIA celebrated its 15th anniversary by hosting a cocktail with investors, friends, and colleagues from Mexico and abroad. The event marked an important milestone, more than anything because it pays tribute to the collective effort that has made the advancement of the LatAm tech ecosystem possible. It does, indeed, take a village, and IGNIA’s longevity is the result of the long-standing support we’ve received from our investors, network of founders we consider colleagues and friends, and fellow VC funds who share our mission.

This gathering featured our partners, Álvaro Rodríguez, Fabrice Serfati, Otto Graff, and Christine Kenna, and together with the investment team, hosted entrepreneurs, investors, alumni, industry leaders, and friends that have been crucial to the development of the entrepreneurial ecosystem in Mexico and across LatAm.

As Mexico’s first VC firm, IGNIA has had a front-row seat to the paradigm shifts that have swept throughout Latin America. Like most momentous changes, LatAm’s transformation has happened gradually, then suddenly. After many years of laying the foundation and literally building out the infrastructure needed to sustain technology companies, LatAm is now poised to experience (long overdue) explosive growth.

IV. Outlook & Perspective

The LatAm tech ecosystem has come of age in the past couple of years. Elements of frothiness crept into the region during the pandemic by way of bloated deals and exorbitant valuations — as did everywhere else — but as we come back to earth we welcome this correction as a renaissance of fundamentals, discipline, and responsible investing. For the sake of LatAm’s long-term prospects, such a shift is well-timed and will ultimately benefit the ecosystem for the better.

Make no mistake, we are already witnessing and continue to expect a difficult environment for both founders and investors in the short term, particularly throughout 2023, as companies shift their focus from a “growth at all costs” mindset to charting a clear path to profitability. Funding risk is a very real phenomenon, and those who predicated their success, not least their survival, on raising capital every few months are bound for a harrowing, if not existential, reality check.

Further, many companies have been compelled to make difficult decisions in an effort to cut costs and extend runway. This great reset may well translate into a great purging, leaving many companies in its wake, but those who emerge on the other side will do so with a much sturdier foundation upon which to continue building. In that vein, we find ourselves returning to the late F1 driver Ayrton Senna’s oft-quoted phrase, “You cannot overtake 15 cars in sunny weather … but you can when it’s raining.” Moreover, it’s worth recalling the slew of generational companies that were shaped during the Great Financial Crisis and ultimately created billions in value, including Slack, Instagram, Uber, and WhatsApp, to name a few.

As this correction fully runs its course, we believe the next few years will be transformational in terms of value creation, innovation, and overall consolidation for VC in LatAm. 2022 is already on track to be LatAm’s second-best year ever — only bettered by 2021. Although it will be difficult to match 2021’s all-time highs, it is worth noting that 2022 has already surpassed 2020’s annual total for both deal count (104 vs 73) and deal value (US$1.02 B vs US$527 MM) as of 3Q22.

To this, we must also consider that VC funds across LatAm and the US have raised record amounts of capital, with US$5.7 B and US$298 B, respectively, of dry powder set to be deployed over the next few years.

Secular trends and tailwinds will continue to drive the development of LatAm, as those illustrated by our friends at Latitud through this excellently-researched report:

As founders now have a growing selection of alternatives when it comes to partnership and access to capital, it is critical to create an edge both in selecting investments and why founders should choose us over others. Over time, reputations and track records do much of the heavy lifting, but they alone are not enough. We’ve been committed to honing a unique, principled point of view to investing, underpinned by a related experienced set and network. Our Anti-Portfolio is as good as any, but we believe this approach stands to make us uniquely valuable partners to a set of founders and companies. We’ve leaned into this strategy from the onset and remain committed to doubling down over the next 15 years and beyond.

As we look ahead to the future, we are confident that the region's strong foundation and untapped potential make it an increasingly attractive destination for investment. We are excited to continue supporting and partnering with the talented founders and teams who are driving innovation and positive change in Latin America.

We would like to thank all of our partners, investors, and supporters for their continued trust and partnership.

Wishing you all joy, peace, and prosperity in the coming year.

Sincerely,

The IGNIA Team