New funds are adding much-needed activity to Peru’s startup community. ADN.VC, Worthit, and EMA Ventures, have each launched in the past year and are keen to invest in Peru’s best startups.
These funds bring a spark of fresh energy – and capital! – to the country’s investment landscape. They also demonstrate an evolution of the venture capital industry in Peru, due to three characteristics: fund partners who have previously led startups, clear investment theses, and investors that represent new sources of private capital.
Experienced partners. The partners of these funds have prior experience as entrepreneurs. For example, one of the partners of ADN.VC, Nicolas di Pace, previously led Culqi, which he sold to BCP. Worthit is led by Jaime Sotomayor, who co-founded various companies and served as Country Manager for Wayra Peru. Finally, EMA Ventures is led by Gaby Vera, who founded InstaFit and LIFT. Due to these prior experiences, the fund managers will be able to meet startup founders wherever they are in their entrepreneurial journeys and offer empathy and a credible point of view. Nicolas’s fund ADN.VC is a prime example of a fund led by a founder who has successfully exited a startup and is now putting money and energy back into the startup community. This profile of fund partner is a key signal of maturity for the venture capital industry in Peru.
Clear Theses. Most of the first wave of venture capital funds in Peru, with vintage years 2017 to 2019, had broad, sector-agnostic investment theses. In contrast, the new funds have more specific investment theses. ADN Ventures has a fintech focus, Worthit will invest in B2B startups, and EMA will invest in women-led companies. This clarity of investment mandate will provide better signaling to founders and make the funds more effective in supporting startups. As the funds mature, valuable knowledge-sharing among portfolio founders will be possible due to each fund’s focus.
Private capital. The capital these funds have raised to date is private capital primarily from investors who are new to the venture asset class in Latin America. The managers of these funds have effectively made the investment case for Peru-based venture capital and are getting dormant capital off the sidelines. In turn, the new investment activity will provide a boost in getting more capital to more seed and pre-seed startups in Peru.
These characteristics prove that a formula exists for the right fund managers to raise and manage small, focused, and independent funds. Backing from development finance institutions or large family offices, while helpful, is not necessary for venture capital funds to get off the ground. In fact, this new activity will serve as validation for larger institutional investors that smaller funds are feasible and can offer attractive returns.
Fortunately, these funds are additive to the existing early-stage investment activity in Peru. UTEC Ventures, Qapu Ventures, B Venture Capital, and Salkantay Ventures are all currently deploying funds from Peru. Corporate venture capital funds Krealo and RPP Ventures are making occasional investments. Regional funds with presence in Peru, ALIVE and Alaya Capital, which are backed by Peru’s development bank COFIDE, have also made investments in Peruvian startups. Other funds, including Winnipeg Capital and AVP Ventures are working on raising second funds to continue investing.
These eager fund managers are setting the tone for the future of Peru’s startup community. The grassroots activity of small funds that have raised private capital shows that the venture capital industry is evolving and is increasingly founder-friendly and founder-led.
Ruta Startup 