All financial markets need market makers in order to remove frictions and facilitate transactions. While in the public markets, market makers buy and sell securities, in longer-term private markets, they can help set prices and build co-investment syndicates. This function allow capital that is sitting on the side lines to jump in. Nowhere is this more true than in nascent, immature markets.
In Peru, we are witnessing the positive evolution of the local venture capital industry. What was once a few one-off angel or family office investments in startups has turned into a vibrant, fully functioning startup ecosystem with multiple local funds investing actively.
A key market-making role has been played by three funds in particular: Winnipeg Startup Fund, Inca Ventures, and AVP Seed Fund I, where I work. Here are some of the things that we have done:
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