Latin America-focused venture capital fund Latitud is preparing to launch an angel fellowship program as part of its vision of taking friction off startup investments, fundraising, and business development.
The angel network is the latest project of the firm founded in 2020 by tech executives Brian Requarth, Gina Gotthilf and Yuri Danilchenko to connect experienced Latin founders with new entrepreneurs while also helping them create relevant business offerings and raise capital. Latitud’s network currently engages around 700 agents across the region, including entrepreneurs and investors – the firm aims to increase that number by fivefold in 2022.
With its first official cohort expected to launch on January 31, Latitud piloted the angel program on an invite-only basis with a pool of investors whose businesses have a combined value of approximately $25 billion. Participants of this first phase of the fellowship included the likes of Loreanne Garcia, co-founder of Mexican autotech Kavak, and Paulo Veras, the co-founder of mobility firm 99, the first Brazilian unicorn.
Rather than aiming for a certain number of angels in the fellowship, Requarth argues the project is about gathering a pool of high-caliber individuals. “If you look at the United States or some places in Europe, there is a huge volume of [founders] reinvesting back into the ecosystem right now. So we think that there’s hundreds, if not thousands, of future angel investors [in LATAM],” says the investor in an interview with Startups.
According to Requarth – who sold Brazilian real estate marketplace Grupo ZAP to OLX for BRL 2.9bn in 2020 and has personally invested in around 80 Latin startups as an angel – the LATAM angel scene is thriving. Still, information on potential investment opportunities is usually limited to a handful of WhatsApp groups of founders. “Somebody has yet to organize that”, he noted.
Once it is officially launched, the idea for the angel fellowship is to offer guidance and access to dealflow. “Just like being a founder, you have questions about your angel investing, such as, ‘Is this the right decision? How do I do my taxes? How do I set up a legal entity? These are all areas we will be looking into”, Requarth says.
The angel program sits alongside Latitud’s founder-focused fellowships, where entrepreneurs pay a one-time fee of USD 1,000 to receive mentorship and business advice from successful founders – the latest cohort, which started this week, has had over a 100 sign-ups from founders across LATAM and the US. However, Requarth says the fee model for the angel fellowship has not been decided yet. “I’m experienced enough to know that you don’t have to have all the answers, you just have to have good questions. And [how to monetize the angel network] is a question that I haven’t answered yet”, he notes.
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While piloting the initiative, the firm could learn more about the current state of “angel literacy” in Latin America. “We have found that even the best founders of top companies in Latin America still need to learn about investing as an angel and still need colleagues to co-invest with. So we want to address those pain points and connect them to our founders to help them fundraise”, says Tomas Roggio, head of ventures at Latitud.
Future roadmap
The venture capital firm’s roadmap for the coming months also includes launching a digital products platform founders will be able to use to accelerate their businesses, alongside the development of Latitud Launch. This marketplace debuted in December to help founders showcase their offerings to potential investors and clients.
“In the immediate future, we will become the go-to place for anyone starting a company in a tech company in Latin America. And also, if you’re an investor, it will be the go-to place to find the best investments”, Requarth argues, adding that there is more to Latitud’s vision than education and that new initiatives are an entry point into its next phase.
Moreover, the company will aim to increase the pool of limited partners for its rolling fund, which has attracted USD 10 million in commitments. Backers include the likes of Gabriel Braga, co-founder at proptech QuintoAndar, as well as David Vélez, global CEO and founder of digital banking behemoth Nubank, as well as Sergio Furio, founder of fintech Creditas and Florian Hagenbuch and Mate Pencz, co-founders of proptech Loft.
In addition, the fund has managers of global VC funds among the investors for the Latitud fund, with average check sizes north of USD 100,000. According to Requarth, it is still early days to talk about returns. Still, highlights of over 60 investments made by Latitud in less than a year – such as Buenos Aires-based fintech Pomelo, which the fund has invested in its pre-seed phase and has already raised over USD 45 million – give a sense of potential markups.
Despite the current macroeconomic uncertainty in Latin America, the Latitud team is bullish about the prospects for 2022, according to Roggio, with an increasing amount of talented professionals interested in starting their ventures. “Many people own our community are leaving highly-paid corporate jobs in banking and consulting and taking the leap into entrepreneurship in a much higher rate than five years ago. So we want to be a catalyst that empowered those emerging founders”, the investor points out.
With access to connections and capital, the main challenge ahead of the Latitud team, according to Requarth, is prioritizing. “I see a world of opportunities in Latin America, and I’m often up late at night thinking about the possibilities”, he says. “It’s still very early days, and we’ve been doing this a little over a year. And I’d say that we’re off to a very good start.”
