Key Takeaway
NXTP, a prominent venture capital firm in Latin America, has raised $98 million for its third fund, which will be used to support B2B startups in the region. This is the largest fund that NXTP has closed to date, highlighting the increasing interest and opportunities in the Latin American startup ecosystem.
Venture capital firm NXTP has made waves in the Latin American startup ecosystem with the successful closing of its largest fund to date. The firm secured $98 million in capital commitments for its third fund, which will be used to support early-stage business-to-business (B2B) startups in the region. This exciting announcement comes as venture capital activity in Latin America continues to gain momentum, attracting both local and international investors.
A Pioneering Venture Capital Firm in Latin America
NXTP, founded in 2011 by Ariel Arrieta, Marta Cruz, and Gonzalo Costa, describes itself as one of the region’s earliest venture capital firms. With offices in Buenos Aires, São Paulo, and Mexico City, NXTP has been at the forefront of supporting startups in their early stages, playing a crucial role in cultivating the Latin American entrepreneurial landscape.
The Evolving Startup Ecosystem in Latin America
Over the years, NXTP has witnessed the growth and maturation of the startup ecosystem in Latin America. Darly Bendo, managing partner of NXTP, reflects on the progress, noting that just five years ago, the total annual investment in the region was under $1 billion. However, in recent years, the market has grown significantly, attracting international funds and reaching an annual investment of approximately $15 billion in 2020 and 2021.
Bendo also highlights a shift in the quality and experience of founders in the region. Previously, a small percentage of founders had prior entrepreneurial experience, especially in the technology sector. However, today, the number of repeat entrepreneurs has increased, indicating a more seasoned and experienced pool of founders in Latin America.
Focusing on B2B Technology Verticals
NXTP’s investment strategy revolves around targeting various B2B technology verticals that show promising growth potential. This includes cloud and software, fintech and payments, e-commerce and enablers, B2B marketplaces, and data and artificial intelligence (AI). The firm’s funds are primarily invested at the pre-seed, seed, and Series A stages, with an investment range of $500,000 to $5 million.
A Proven Track Record and Expansion
With its previous funds, NXTP has invested in over 130 companies, including Auth0, Nuvemshop, and Mural, which have achieved unicorn status. The firm has also seen over 30 successful exits, underscoring its ability to identify and support high-potential startups in Latin America. The newly raised fund, NXTP Fund III, represents a two-fold increase in size compared to its previous fund, enabling the firm to invest in 25 to 30 companies.
Brazil has been a particular focus for NXTP, with over half of its investments made in the country. However, the firm has also made significant investments in startups across Mexico, Colombia, Argentina, Chile, and the rest of Latin America. The success and growth of NXTP’s funds can be attributed to the support of its existing limited partners, including U.S. and global institutional funds, regional fund-of-funds, multi- and single-family offices, high-net-worth individuals, and technology founders.
With the closing of its latest fund, NXTP is poised to continue driving the growth and development of the Latin American startup ecosystem. The firm remains committed to identifying and supporting the best teams and ideas within the B2B technology space, fostering innovation and entrepreneurship in the region.
