UPDATE 1-Nubank, partner of Sequoia to invest in Latam -sources startups


(Add the reason for the partnership, the sectors they plan to invest)

By Caroline Mandl

SAO PAULO, Nov. 1 (Reuters) – Brazilian fintech Nubank and venture capital firm Sequoia Capital are teaming up for future investments in Latin American startups, two sources familiar with the matter said on Monday.

Best known for its no-fee purple credit cards, Nubank, which has been backed by Sequoia since 2013, has decided to invest alongside it in startups in sectors that may go beyond financial services, such as the Internet grand. public and enterprise software, the two sources added. .

In its initial public offering prospectus released on Monday, Nubank said it was considering investments in sectors such as healthcare, e-commerce and telecommunications, but did not disclose its partnership with Sequoia.

Nubank, which revealed it was aiming for a valuation of more than $ 50 billion, also said in the document that it intends to challenge existing business models in these sectors.

The two companies’ move comes amid a boom in venture capital transactions in the region, as Latin America has created a dozen high-yielding startups. Funding rounds have skyrocketed to $ 14.8 billion in the first nine months of this year, almost tripling from all of 2020, according to CB Insights.

Sequoia has only made half a dozen investments in Latin America, including Nubank and the Rappi delivery app, but it plans to increase the money going to the region, said Sonya Huang, partner of the venture capital firm, in a recent interview with Reuters.

For the venture capitalist, the deal adds a partner with a presence in four countries in the region – Brazil, Mexico, Argentina and Colombia – and with experience in business development, the sources said. . For Nubank, this adds a partner with global experience in investing in startups.

Paulo Barbosa, former vice chairman of GIC Singapore, will lead Nubank’s venture capital forays, and partners Sequoia Huang and Stephanie Zhan will be responsible for its efforts in the region, the sources say.

The sources did not disclose how much they plan to invest in the region or how they would divide the funding rounds. Under the terms of the agreement, the two companies can also invest in startups separately.

In August, Nubank and Sequoia joined forces in a $ 44 million funding round for Indian digital bank Jupiter, with Matrix Partners.

One of the sources said that Sequoia and Nubank have also looked at a number of digital banking investment opportunities in other emerging markets to jointly invest.

Sequoia and Nubank declined to comment on the matter. (Reporting by Carolina Mandl; Editing by Jan Harvey and Steve Orlofsky)

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