Mercado Pago raises $466M in debt financing and other top funding stories in Latin America

Below are the venture funding activities we are tracking in the Latin American region this month.

Mercado Pago raises $466M in debt financing for LatAm expansion

• Mercado Pago, the digital bank of Mercado Libre, has received a debt financing of $466 million from Citi subsidiaries to fuel its expansion.
• Citi's investment is strategically divided between the two countries, with Banco Citibank SA contributing $237 million to Brazil and Citibanamex providing the equivalent of $229 million to Mexico. This funding builds upon a previous successful deal in 2021, reinforcing the collaboration between Mercado Pago and Citi.
• The two-year agreement will be specifically allocated to boost the lending capabilities of Mercado Pago's financial arm, Mercado Crédito, focusing on consumers, entrepreneurs, and small businesses, and ultimately stimulating economic activity in both the Brazil and Mexico region.
• Mercado Crédito, operating in Brazil, Mexico, and Argentina, has witnessed a robust annual expansion of 22.6% in its credit portfolio, reaching a valuation of $3.4 billion in the third quarter of 2023. Notably, 20% of this portfolio is attributed to sellers within Mercado Libre's platform and the broader regional market.

Brazilian fintech, iugu, secures $14 million investment to fuel its expansion

• Brazilian fintech firm iugu has successfully raised a significant $14 million in a new senior quota series in its FIDC (Investment Fund in Credit Rights), with Bradesco BBI taking the lead in the transaction.
• Launched in 2012 holds a license from the Central Bank of Brazil to operate as a regulated Payment Institution specialising in cash management and payment automation.
• Since its launch, it has experienced remarkable growth, with an 80% increase in operations and projects in 2023 compared to the previous year. This move solidifies iugu's position as a leader in cash management and payment automation solutions.
• The funds will be directed towards advancing credit card receivables payments and further enhancing its offerings and services to its growing user base. It will also use it to fuel its ambitious expansion plans.

Barte Fintech Secures BRL$20 Million in Deventure Funding

• Barte, a B2B payments fintech, has successfully raised R$20 million ($4.1 million) through a debenture operation, structured and coordinated by Bamboo fintech.
• This fundraising marks the third funding in the last 12 months, following a seed round of R$16 million ($3.3 million) in March and a R$6.5 million ($1.3 million) pre-seed in November 2021.
• Founded in 2021, the Brazilian fintech operates a payment platform that streamlines and facilitates payment transactions and provides access to working capital financing.
• The capital injection is expected to support the fintech's strategic goals of providing financial solutions for small and medium-sized businesses (SMEs).

Extendeal Raises $7.5 Million to Revolutionize Medication Purchases for Pharmacies

• Extendeal, an Argentinian health tech has secured an impressive $7.5 million in recent funding, bringing its total funding to date to about $20 million in investments.
• The health tech startup operates a digital platform that aids pharmacies in sourcing medications quickly and efficiently. It boasts an established presence in Argentina with up to 2,000 pharmacies.
• The funding is part of Extendeal's strategic initiative to expand its services in Colombia and Mexico. It aims to become the go-to platform in Latin America for pharmacies looking to buy smarter and cheaper

CondoConta Raises $14.6 Million to expand fintech services

• Brazilian fintech CondoConta specializing in banking services for condominiums has secured approximately $14.6 million in its Series A funding round.
• The investment is led by new participants SYN Proptech, Endeavor Scale-Up, and Terracotta Ventures, alongside existing investors Redpoint eVentures and Igah Ventures.
• CondoConta distinguishes itself with a unique business model providing solutions to streamline the payment of condominium fees. It offers a comprehensive suite of financial services, including checking accounts, credit cards, loans, financing, and delinquency management.
• With the capital injection, CondoConta plans to triple the opening of new accounts, leveraging native interfaces with major condominium management systems (ERPs) and administrators in Brazil.

QI Tech acquires Singulare shortly after BRL$1 billion investment round

• Brazilian fintech QI Tech, has acquired 100% of Singulare, a prominent stockbroker in Brazil, two weeks after announcing a BRL$1 billion (~ $200 million) investment.
• Singulare, with a strong financial performance, is expected to contribute significantly to QI Tech's growth strategy. The deal awaits regulatory approval, and the Singulare brand is likely to be retained. The FIDC industry is anticipated to benefit from recent regulatory changes, allowing retail investors to participate, and fostering long-term growth in the sector.
• The transaction details and value remain undisclosed, pending approval from the Central Bank (BC) and the Administrative Council for Economic Defense (Cade). The acquisition aligns with QI Tech's 'DTVM as a service' business unit, approved by the Securities and Exchange Commission (CVM) and Anbima four months ago, making it the first credit fintech in Brazil licensed as both a distributor of securities and a broker.

Kavak to exit Colombia and Peru in 2024

• Mexican used-car trading unicorn, Kavak, is winding down operations in Colombia and Peru from January 2024, following its mid-2022 market entry, as it focuses on more lucrative markets aligned with its vision and objectives.
• The unicorn initially expanded into Colombia and Peru in July 2022 while committing to sustaining operations in Chile, Turkey, Argentina (acquired through Checkars in 2020), and Brazil (entered in 2021).
• Achieving unicorn status in 2020, Kavak secured a $1 billion valuation and became Latin America's second most valuable startup by September 2021, valued at $8.7 billion after an investment round featuring SoftBank.
• Despite initiating operations in Colombia's vehicle reconditioning plant in May 2023, Kavak will now redirect efforts toward profitable and high-growth markets.

Follow our full coverage of the Latin America startup and technology scene and get up to date with what's happening in the key markets within the region.