Category: Magma Portfolio

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Magma Partners: Our 2018

2018 was an expansion year for Magma Partners. We started on a high note, closing our Fund II with backing from LPs in Chile, Colombia, Argentina, China and the US in January. We’re part of the movement that made 2018 the year people started to take Latin American tech seriously.

At the same time, we announced the launch of the Sino-Latin American Accelerator, a partnership with Chinese coworking company, Kr Space, that helps Chinese entrepreneurs and investors reach the Latin American market, and Latin Americans take advantage of Chinese market knowledge and venture capital and Jie Hao, our Beijing-based Partner, opened a full time office in Beijing.

We added amazing people to our team across Latin America, China and the US, bringing us to seven full time and 10 part time team members. We have people on the ground in San Francisco, NYC, Austin, Beijing, Mexico, Chile, Colombia and Peru. Francisco supports Magma teams with Latin American connections, providing a link to top Latin American businesses that can make companies.

JT, Pedro, Sophia, Alejandra, Angel have been amazing additions to the full time team and are helping us build the support system for the entrepreneurs we’ve been lucky enough to be able to support. Pedro, Paolo, Eugenio, Codie, Neil and Pierre make up the amazing support team that allows us to have the reach we need. Our LPs in Latin America, China and the US are also a crucial support system, both in connections and advice, but also in follow on funding. Our LPs have invested and additional $5.5M into Magma portfolio companies this year, giving us the ability to help companies as they scale.

Angel Andraca, Sophia Wood, Pedro Pablo del Campo, Alejandra Dugarte, JT Li, Magma Team, Santiago, Chile

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Jooycar raises US$3M from HCS Capital

Jooycar is bringing the Usage-Based Insurance model to Latin America. Through a small device that plugs into your car, Jooycar has access to each vehicle’s usage metrics, which individuals and insurance companies can view through an app or on their online platform. Jooycar was founded by Maria Paz Gillet, Emilio Figueroa, and Mario Ungemach, a Chilean-Mexican team with years of startup and innovation experience under their belts.

Jooycar recently received US$3M in follow-on investment from HCS Capital, an investment fund based in Miami. Alex Horvitz and Luis Felipe San Martin, CEO and Managing Partner of HCS Capital, respectively, led the investment. We have invested in Jooycar twice as Magma since 2016 and are excited to add HCS as a coinvestor. Jooycar will use the investment from HCS to improve their platform and reach one million connected cars across Chile, Colombia, Peru, Brazil, and Mexico by 2021.

Jooycar is a perfect example of our investment thesis in action, as a startup that was founded in Chile that is now headed to the US. As a part of the investment, Jooycar will move its headquarters to the US to enter that market more smoothly. They have also added Rodrigo Labbe, ex Head of Marketing at DirecTV Chile, as new CEO, while Maria Paz will act as Chief Innovation Officer.

Maria Paz is a serial entrepreneur who started her career by building Chile’s first e-commerce platform. She went on to innovate within Cencosud, one of Chile’s largest retail brands, before leaving the company to found Jooycar. We have loved working with Maria Paz and watching her build Jooycar alongside her team. You can learn more about her story on Nathan Lustig’s podcast or in this article for Forbes about Jooycar.

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Magma Partners invests in Chilean sports-streaming startup, Fanatiz

Fanatiz lets you keep up with Latin American football leagues from anywhere in the world. The service currently offers coverage of the Libertadores and Sudamericana Cups, and soccer leagues from Argentina, Brazil, Chile, Mexico, and Peru.

Founded in Chile in 2017, Fanatiz has its headquarters in Miami, while maintaining most of its operations in Chile. The startup also has offices in Spain and Argentina. We recently invested an undisclosed sum in Fanatiz to help the startup grow globally.

“We’re really excited to partner with Magma Partners as we continue our path of rapid growth and market expansion. With clients in over 100 countries, we place special value in Magma Partners’ vision and support for Latin American companies growing on the global stage,” said Fanatiz co-founder and CEO, Matias Rivera.

“Fanatiz embodies our commitment to helping Latin American startups tackle the US and international market,” said Managing Partner, Nathan Lustig.

The Fanatiz team was also selected by 500 Startups to participate in their Miami Growth program, alongside nine other startups from the US and Latin America.

After a little over one year in business, Fanatiz already has customers across the globe, including Pope Francis. The startup made the news last year when it provided the Pope with access to their app so he could follow his team, San Lorenzo, from the Vatican.

Expect to hear more about this dynamic startup in our quarterly updates!

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Nathan Lustig’s Interview with Pedro Varas, CEO and Co-Founder of FounderList

Last month, I had Pedro Varas, the CEO of FounderList, interview me in Spanish on three topics: my personal journey, my view on the entrepreneurship ecosystem in Latin America, and vesting. You can watch the three trailers and find the links to the full interviews below. I hope you enjoy the videos.

Part 1. My Story

I was born and raised in Wisconsin. It wasn’t clear at first that I would follow the path to entrepreneurship since I studied political science in college. Then, in my freshman year, I couldn’t get season tickets for our football team,which upset me because I had been looking forward to the games quite a lot. I tried all means to find a ticket, and that is how I found out about a book exchange website at my university. I ended up buying the site with a friend and brought it to 175,000 users across  10 universities. After selling the site to another company, I started my second company, Entrustet, which aimed to resolve the issues of managing digital assets when someone died. This startup took me down South to join the pilot round of StartUp Chile, where my course changed. I eventually started my current career as a venture capitalist that bridges US and LatAm.

To view the complete interview please click here.

I also did a podcast in which Devin Baptiste from GroupRaise interviewed me in English. Check that out here if you are interested in knowing more details.

 

Part 2. Why Startups Fail

In this part, I talked about the startup ecosystems in LatAm, what will make an investor say no, why most startups fail, how I view the wage gap between US and LatAm, and which industries are the most promising for the region. When I first arrived in Chile, I saw there were many opportunities to improve the way business is done here. Following my entrepreneurial instincts, I stayed and became an investor. Fast forward to 2018, and things have improved a lot, yet there are still many opportunities. As the startup ecosystem continues developing, the time to invest in Latin America  is now. At the end of this interview, I recommend a daily practice to help every entrepreneur-to-be identify problems and create solutions.

 

To view the complete interview please click here.

 

Part 3. Vesting

Vesting is an important concept that many founders fail to understand. At Magma, we have rejected some good companies because they have founders who had left the company a long time ago but still owned a big share of the company. This is not fair to the founders who stayed and actually worked to make the company survive. In this video, you will find out what vesting is, why it is important, the difference between founder vesting and employee vesting, when to have an employee option pool and some cases.

To view the complete interview please click here.

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