 Venture investment in Latin America jumped past the $15B mark for the first time in 2021. The $15.3B deployed over 650 deals constituted a tripling of the dollar volume from 2020 and was worth more than the past seven years put together. More: - The top sector was by far fintech, with 39% of all funding. It was followed by e-commerce with 25% and proptech with 9%.
- A fintech company generated the year’s top round: Nubank, a Brazil-based online challenger bank, raised $750M in pre-IPO financing in June. It subsequently extended the round to $1.15B before going public in December.
- Late-stage funding deals generated the vast majority of funding with a total of $13.3B, over two-thirds of total funding.
- With a total of $5.5B raised over 242 Series A and B rounds in 2021, early-stage deal-making was substantially up from $1.6B over 136 deals in 2020.
- There are now 27 unicorns in LatAm.
- The continent’s reach has long since arrived at the doorsteps of top firms.
- SoftBank launched a second investment fund of $3B dedicated to the region, taking its total commitment there to $8B.
- However, it was not the all-around most prolific investor. That title went to Kaszek with 42 deals throughout 2021.
- SoftBank did manage to be the top late-stage investor, leading eight rounds.
- Meanwhile, YC is also doubling down on its LatAm presence with 65 seed-stage rounds.
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Indian food delivery startup Swiggy raised $700M Series K at a $10.7B valuation to surpass the market cap of chief rival Zomato. Invesco led the Bengaluru-headquartered startup’s Series K round, which followed a $1.25B round just six months earlier. More: - Zomato used to dominate Swiggy, but its stock has fallen by almost 33% since its high point in late November.
- Its current market cap is around 80% of the figure it generated at the time of its debut.
- Other participants in the funding included Baron Capital Group, Sumeru Venture, IIFL AMC Late Stake Tech Fund, Kotak, Axis Growth, Sixteenth Street Capital, Ghisallo, and others.
- Swiggy is expanding its offering with instant delivery.
- Instamart, the firm’s new service, is set to reach an annual GMV run rate of $1B in the next three quarters, reports the company.
- Instant delivery is kicking up in India, as it is just about everywhere else.
- Recently, YC’s Continuity Fund led a $100M round for instant delivery player Zepto, while Zomato-backed BlinkIt entered the market last year.
- Sriharsha Majety, Swiggy’s co-founder and CEO, wants to boost Swiggy’s customer base to 100 million using the platform 15 times per month.
- Analysts expect the Indian food market to reach $97B by 2025. Of that, 55% will be dominated by organized food services. At the same time, online penetration should grow to 20% for a ~$20B total market value.
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The Theranos scandal is no indictment of venture capital's investment strategy, writes Sebastian Mallaby for the New York Times. Rather, VCs' decision to invest in Elizabeth Holmes' startup with the expectation that it was likely to fail is par for the course. Moreover, most of Holmes' investors were venture tourists, including the Walton family with $150M, Rupert Murdoch with $121M, and $100M from both the DeVos family and the Cox family. More: - Mallaby, who recently published a book, The Power Law: Venture Capital and the Making of the New Future, notes that the VC strategy of accepting 99% losses in the hopes of one investment providing outsized returns does prompt the question of incompetence or luck.
- Two hypotheses to this point are prevalent: With such a high fail rate, picking winning startups is a matter of luck. Or top VC firms could benefit from the "halo effect," which funnels the best companies into their portfolios.
- According to Mallaby, the "halo effect" appears fleeting at best. He cites the decline of Kleiner Perkins as evidence.
- Formerly the uncontested top VC firm, Kleiner Perkins has fallen far from grace in the course of just 20 years, losing most of its top partners.
- To the extent that picking top companies is not sheer dumb luck, Mallaby cites the extensive angel networks created by the top investment outfits. These allow investors to pinpoint top startups early in their careers and prime them for investment.
- On top of that, the extensive research of tech development and market trends undertaken by VCs makes them particularly well-positioned to recognize a business model that can latch on to the latest shifts, giving them the ability to see how radical ideas can become feasible in just a few years.
- Only a fraction of 1% of firms in the U.S. receives VC backing.
- This tiny minority accounts for 47% of the nonfinancial companies that make it to public markets, and 89% of R&D spending by listed firms.
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Wisk Aero clinched a $450M investment from Boeing to develop electric air taxis. The company now claims to be one of the most well-funded advanced air mobility (AAM) companies in the world. More: - Wisk has announced its target of having a full-scale, commercially operational air taxi business within the next five years.
- To that effect, it wants to expand its 350-strong workforce, develop its manufacturing capacity, and advance its sixth generation self-driving electric vertical-take-off-and-landing vehicle (eVTOL).
- While analysts predict that the flying taxi market could grow to $150B in revenue by 2035, they also note that the FAA has yet to certify any eVTOL vehicle for commercial use.
- It will probably take at least five years for the agency to determine that any such vehicle is safe for passengers.
- Despite the regulatory hurdles, Wisk partnered with urban mobility company Blade last year to own and operate a fleet of 30 aircraft on its network.
- It also has an agreement with New Zealand to conduct a flying taxi trial using its all-electric, self-flying aircraft Cora.
- Wisk has interestingly retained its status as a private company. In recent months, many competing AAM companies have turned to SPACs to raise funds.
- The company was founded as a joint venture between Boeing and Kitty Hawk, the flying taxi company bankrolled by Google co-founder Larry Page.
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 Today's Funding 💸 Biotech/Health - A Place for Mom (New York, N.Y.), marketplace for senior care services: $175M led by Insight Partners, participation from General Atlantic, Silver Lake.
- Kenbi (Berlin, Germany), decentralized network of mobile caregivers: $26.6M A led by Healthtech Growth Fund Endeavour Vision, participation from Redalpine, Heartcore, Headline, Partech, Amino Collective, et al.
- Zoi (France), personalized insights medical insights platform using checkups; $23M Seed from Jean-Claud Marian, Stéphane Bancel, Xavier Niel, Rodolphe Saadé, Jean-Marie Messier, Jean Moueix, et al.
- SeqOne (Montpellier, France), genomic analysis solutions for personalized medicine: $22.6M A led by Omnes, Merieux Equity Partners.
- Intellect (Singapore), self-directed mental wellness programs in 15 languages and online therapy sessions:...
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- Saudi Arabia-based Elm, a digital security firm, is seeking to raise up to $820M in an IPO. The company is owned by the Saudi sovereign wealth fund, which has gone deeper into public markets this year by investing about $10B more into listed stocks.
- Savvy Gaming Group, a Saudi-backed studio, bought two tournament/league operators, ESL and FACEIT, for a total of $1.5B.
- German instant delivery startup Gorillas acquired Frichti, a French startup that delivers both ready-to-eat meals and groceries, for an undisclosed sum. Frichti had raised $114M to date.
- AccuWeather acquired France’s Plume Labs, an air pollution data platform, for an undisclosed sum.
- Singapore-based Blockchain Founders Fund launched a second fund with $75M in commitments from NEO Global Capital, Appworks, Baksh Capital, Octava, and others.
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 |  | Inside VC's writer/curator Stephen currently lives in Berlin and is pursuing a Master's degree in philosophy. He otherwise spends his time trying his hand at recipes from India and Southeast Asia, escaping it all at the kickboxing gym, and offending aural sensibilities with his band. |  | | Editor | Aaron Crutchfield is based in the high desert of California. Over the last two decades, he has spent time writing and editing at various local newspapers and defense contractors in California. When he's not working, he can often be found looking at the latest memes with his kids or working on his 1962 Ford. | |
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