A fintech company may be the next LATAM unicorn

Of the 79 Latin American startups with a valuation of over $100M, almost 40% belong to the fintech industry. In terms of representation, this makes it more likely that a startup from this sector will become the next regional unicorn.

The Soonicorn Club map was identified by ALLVP Research, the intelligence unit of early-stage investment fund ALLVP.

Of the 79 startups included in the report, 38% belong to the fintech industry, 13% to smart enterprise, 8% to e-commerce, 8% to logistics, and 6% to health-tech. The rest fall into other smaller industries.

Unicorns are multiplying in LATAM

The companies that have turned into unicorns in 2021 –i.e., those who have reached a valuation of or over $1B– are the following, per country and according to LAVCA:

Argentina

• Ualá ($2.45B)
• Tiendanube ($3.1B)
• MURAL ($2B)

Brazil

• Mercado Bitcoin ($2.1B)
• MadeiraMadeira ($1B)
• Loft ($2.9B)
• QuintoAndar ($1B)
• Nubank ($30B)
• Gympass ($2.2B)
• Loggi ($2B)

Chile

• NotCo ($1.5B)

Colombia

• Rappi ($5.25B)

Mexico

• Clip ($2B)
• Bitso ($2.2B)
• Kavak ($4B

There are plenty of industries represented in this list. Tiendanube is an e-commerce company, Rappi focuses on delivery, Kavak is booming in the automotive. However, the company with the highest valuation of all is Brazilian fintech Nubank, with a valuation of $30B.

Fintech, industry with the biggest potential

Of the several factors that are boosting fintech’s growth in Latam, the two most important are the percentage of unbanked population in the region’s two largest countries (Mexico, with 50%, and Brazil with 30%), and the predominant use of cash for payments (90% and 70%, respectively).

Latin American entrepreneurs have not hesitated to offer solutions–and investors to support them. According to Crunchbase data, more than $7B have been invested in LatAm fintech companies since 2016.