Venture capital: How the ecosystem is bouncing back in Latin America

After a major downturn in 2022 and 2023, Venture Capital in Latin America is showing strong signs of recovery. According to a report by the entrepreneurial community Endeavor and investment firm Glisco Partners, startups in the region raised $2.85 billion across 432 deals in 2024. This represents a 26% increase in capital compared to 2023, despite a slight 2% decrease in the number of transactions.

A maturing ecosystem

Vincent Speranza, Managing Director of Endeavor Mexico, told Entrepreneur en Español that “2025 is shaping up to be a tough year, but also a pivotal one for the ecosystem of tomorrow.” He highlighted that the growth of venture capital in Latin America outpaced Europe’s (7%) and contrasted sharply with Southeast Asia, where investments dropped by 34%.

Speranza noted several signs of ecosystem maturity: an increased use of venture debt, more secondary rounds, and wider adoption of employee stock ownership plans (ESOPs). These foundational shifts, although still under the radar, are expected to lead to significant exits like mergers and acquisitions (M&A) between 2026 and 2027.

Mixed funding rounds on the rise

Since 2022, debt financing has gained relevance among entrepreneurs, especially unicorns like Kavak, Clip, Clara, and Konfío. In 2024, some startups began combining venture debt with equity, creating hybrid rounds that totaled $144 million, accounting for 5% of the year’s total capital raised.

Industries attracting the most capital

Eric Pérez-Grovas, founder and managing partner at Mexican VC firm Wollef, shared that three startups in his portfolio have recently closed successful rounds. While he sees opportunities across various industries, he affirmed that fintech remains the most attractive sector for venture capital investors.

This aligns with the Endeavor and Glisco Partners report, which found fintech leading in total investment volume. Other high-potential sectors include e-commerce and artificial intelligence (AI).

One standout fintech case is Colombian startup Cobre, which raised $35 million in a Series B round in September 2024. The round was led by Oak HC/FT and included QED Investors, Canary, and Kaszek. CEO José Vicente Gedeón said the funding enabled the company to expand into Mexico. He emphasized that building a fintech company with sound governance, healthy margins, and steady growth continues to attract investors.

AI startups spark renewed interest

In the AI space, Numia, an Argentine SaaS platform that combines AI automation with human interaction for B2B customer experience, secured $3.5 million in its first funding round in December 2024. The round was led by Mexican VC fund Cometa. CEO Gustavo Lauria stated that AI’s real business value is fueling the return of venture capital interest.

Zapia, a Latin American AI-powered executive assistant, also gained traction by raising an additional $7.25 million in a seed round extension, bringing the total to $12.35 million. Led by Prosus Ventures with support from Endeavor Catalyst, the round was oversubscribed.

CEO Juan Pablo Pereira explained that capital is more accessible for AI-first companies. “Startups where AI is not central to the business are facing tougher conditions,” he added.

Finally, the report revealed that proptech and software sectors saw the fastest growth, with annual compound growth rates of 200% and 300%, respectively, reflecting emerging trends in the region.