Startup investments in Latin America rose by 26% in 2024 compared to the previous year, according to a report by Endeavor and Glisco Partners. This growth surpassed Europe’s 7% increase and contrasted with a 34% decline in Southeast Asia.
The region is expected to see continued funding momentum in 2025, driven by a young population, widespread digital adoption, and increasing capital market maturity.
The study noted a shift in investment focus toward more mature startups. In 2024, 65% of all capital raised went to later-stage companies, up from 46% in 2023. This trend reflects investor preference for established, scalable business models amid ongoing global economic uncertainty.
Domestic investors primarily supported early-stage ventures, while foreign investors contributed more at advanced stages.
“There are fewer funding rounds, but each carries more capital,” the report said.
Despite growth, the report highlighted challenges. Local investors contributed less to later-stage funding rounds, leaving a gap in the scale-up phase. The study also pointed to continued sensitivity to global market volatility.
“Startups that adapted to market changes are emerging stronger and more sustainable,” said Alfredo Castellanos, Managing Partner at Glisco Partners.
Three emerging trends are expected to shape the region’s startup landscape in 2025:
Venture Debt and Mixed Rounds: Startups are increasingly using a mix of equity and debt to raise capital.
Secondary Market Activity: Secondary share sales are projected to grow 60%, helping early investors exit.
Employee Stock Ownership Plans (ESOPs): Though only a small share of startups (under 20%) currently offer them, ESOPs are gaining relevance as a tool to retain talent.
Fintech remained the most funded sector in Mexico, while proptech and software saw the fastest growth. Mexico and Argentina led the venture capital recovery across the region.
Mexican startups like Clip and Justo secured large financing rounds and continued to draw consistent investor interest. In Argentina, fintech firm Ualá raised $330 million, representing 73% of all capital raised in the country.
The report concluded that Latin America is building a stronger startup ecosystem but must improve domestic funding participation in growth-stage investments.
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By Proptechbuzz
By Ravi Kumar