Magma Partners’ Q1 2019 Update

The Magma Team together in the office in February 2018.

After an active 2018, we’ve continued to push forward in 2019. Since our last update, we’ve invested in 4 new companies from four different countries, including Base Operations. We’ve also continued to expand our team and the services that we’re helping to provide in the Latin American ecosystem.

We now support 51 companies in our portfolio, which now sell $29M+ each year, have raised $46M in follow-on funding, and employ more than 600 people worldwide. Our growing team provides diverse experiences and networks to our portfolio, including support in marketing, PR, DevOps, sales, and international expansion strategies and covers geographies like Chile, USA, Mexico, Colombia and China. We’re excited to further support the startups in our portfolio as they continue grow!

Check out the following overview of news from our fund and our portfolio for Q1 2019.

1. We welcomed Eugenio Perea to the Magma Team.

Eugenio Perea presents at Citibanamex.

Originally from Mexico, Eugenio joined Magma as our Venture Partner for Mexico in early February 2019. Eugenio has been involved in every side of the Mexican entrepreneurial ecosystem as a founder, company builder, venture capitalist, and advocate for small businesses in Mexico City. He is an energetic, quick with ideas and provides us with insider knowledge and a better understanding in the Mexican market, as well as bringing years of entrepreneurial experience to the team.

To learn more about Eugenio’s story, check out his interview with Nathan Lustig.

2. We added Josefina Dominguez to the Magma Team.

Based in Argentina, Josefina joined the Magma team in February 2018 to provide support with content, especially on LatAm List and on our social media.

Josefina learned about social media strategies for business while getting her own small baking company off the ground. Originally from Buenos Aires, Josefina is also a chocolatier who grew up all over the world, from Canada to South Africa, Ukraine, and Argentina. She is excited and passionate about helping startups and investors create online strategies that connect them with their clients.

3. Mexican neobank, albo, received follow on from three funds.

Albo is dedicated to improving access to financial services for Mexican clients through fully-mobile debit card based bank accounts. Albo raised a $7.4M Series A round led in January 2019. Albo will use this funding to expand the team and make their services accessible across all Mexican territories.

4. Nathan spoke at MITA Tech Talks.

Nathan joins a panel at the 2019 MITA Tech Talks.

Nathan traveled to Mexico City and Guadalajara in January and ended the month presenting at MITA Tech Talks, in Punta Mita. He discussed the Latin American and Mexican VC ecosystems, as well as the growing Asian influence in the region and why we should be paying attention to it. Thanks to Lynne and Andreas for inviting us!

5. Three more companies provided returns to the portfolio.

It’s hard to generate returns in venture capital, and especially in Latin America. We’re happy to have added three new companies to our list that have generated returns for our investors. While none of these have been big exits that will return the fund, we’re taking steps in the right direction and are excited to see how the rest of 2019 turns out.

6. We have spent time in San Francisco, New York, DC, Austin, Chile, Colombia, Mexico, and China in the past three months.

Sophia and Josefina taste local ice cream in Buenos Aires.

Our team has traveled a lot in the past three months. Nathan spent several weeks on the road with one of our companies as they have been raising money in Silicon Valley, New York City, and Washington DC. Pedro spent time in Santiago, traveling from his base in Austin. Francisco joined Nathan in New York for the Bank of America Latin American technology summit. Sophia spent time in Argentina and London, meeting Josefina for ice cream during a stopover in Buenos Aires . We were also invited to YCombinator Demo Day and got to watch several exciting Latin American startups take the stage, including Keynua, Truora, Pachama, and others.

6. Nathan Lustig published “Crossing Borders: A Venture Capitalist’s Guide to Doing Business in Latin America.”

Our Managing Partner, Nathan Lustig, brought together all the knowledge from his blog and from eight years working in Latin America to publish his third book: Crossing Borders: A Venture Capitalist’s Guide to Doing Business in Latin America. This book collects interviews with 30+ entrepreneurs and investors working in the regional market, as well as chapters on the startup ecosystem in each country in Latin America. Crossing Borders is not the end-all-be-all for working in Latin America, but it is a great jumping off point for anyone working in the region or considering a job in Latin America.

If you would like to read it, please find Crossing Borders: A Venture Capitalist’s Guide to Doing Business in Latin America on Amazon.

7. Notable guests on Crossing Borders + new articles.

In Q1 2019 Crossing Borders featured some interesting guests:

While Nathan does the interviews, it’s a true team effort, with Sophia, Angel, and Josefina contributing to make the podcast a reality.

Our work was also published in respected publications worldwide, including:

New articles on Nathan Lustig’s blog:

8. LatAm List is being syndicated on 36Kr.

LatAm List has been a source of English-language tech news for the Latin American ecosystem for over a year. Many of our articles are now being translated and published on 36Kr, China’s version of TechCrunch,  to share news about the Latin American ecosystem with a Chinese audience. We’re hoping to create more partnerships like this around the world, especially in Asia.

9. Pedro Pablo del Campo attended Techstars Austin Demo Day and hosted a Chile event at SXSW.

Pedro Pablo, our US based partner, represented Magma Partners at two entrepreneurship events in Texas this year: Techstars Austin Demo Day and South by Southwest. He spoke to startups and investors based in the US about the Latin American ecosystem, growing connections between the US and LatAm, and organized a meetup for Chilean entrepreneurs.

10. Eugenio and Nathan spoke on a Citibank call about Mexican Fintech

Eugenio Perea was invited to present at the Citibanamex annual meeting a few months ago to talk about fintech in Mexico. As a follow-up, the bank asked Eugenio and Nathan to lead a conference call with bank employees and clients who wanted to hear their insights about the Latin American fintech market.

11. Fanatiz expands its services.

Fanatiz is a soccer streaming service for Latin American fans living abroad. They recently broadcasted the Clasico Real between Madrid and Barcelona in US and even got a shoutout from the commentator. While Fanatiz previously offered access to Latin American cups, as well as games from teams in Chile, Argentina, and Mexico, the startup is now branching out to include Golf and the Olympic Qualifiers in Chile, and will also reach Colombia this year. We invested in Fanatiz in mid-2018 from our Fund II.

12. Mexico’s Entrepreneur Association (ASEM) is presenting Pago en 30 Dias Law, supported by Eugenio Perea.

In January 2018, Chile passed a law requiring companies to pay their invoices within thirty days of accepting them. Until that law, large businesses could wait 60, 90, or even 120 days before providing liquidity to their suppliers. This delay can kill small companies and startups who could easily become insolvent without liquidity, as they depend on predatory loans to breach the gap. Eugenio Perea is part of the team at ASEM that is seeking to do the same in Mexico, where small businesses face the same problem. The law is currently being considered by the Mexican Parliament.

13. JT and Sophia attended Family Office Bootcamp, a talk with Tim Draper, and InvestChile.

Sophia discusses Latin American startup investment on CNN at InvestChile.
Chilean president, Sebastián Piñera, makes an appearance at InvestChile.

Valhalla Private Capita made a visit to Chile during the last week of March to train the local ecosystem in funding startups. Over the course of their three-day bootcamp, they coached startups and VCs/family offices how to optimize their investments and how to invest in a market that looks nothing like Silicon Valley.

Magma Partners’ Principal, Sophia, and Portfolio Manager, JT, were invited to participate in the event, including in a Women’s Conversatory on the challenges of bringing women into investment and entrepreneurship in Latin America.

JT Li and Sophia Wood discuss the Valhalla Bootcamp.
JT and Sophia attend a panel with Tim Draper in March.

14. Founderlist made the news for investing in Chilean biotech and medtech entrepreneurs abroad.

Founderlist, an AngelList for Latin America, recently participated in two later stage rounds for Chilean biotech and medtech startups based in the US market. They participated with small tickets using their Syndicate model to open a hot investment opportunity to local investors who would not have otherwise had the opportunity to get into the deal.

One of the companies, Levita Magnetics, was on Fast Company’s most innovative Latin American companies list this year. Levita’s total round was $5M; Founderlist helped raise a small ticket for the round from Chilean investors. The other company, Praxis Biotech, raised a total of $8M, with Founderlist supporting through a Syndicate in Chile.

15. Kriptos expanded into the Chilean market.

From left to right: Kriptos Co-Founder and CEO, Christian Torres, Magma Principal, Sophia Wood, Magma Portfolio Manager, JT Li, and Kriptos Business Development Manager, Emmanuel LePoutre, during a visit to Chile.

Kriptos is an Ecuadorian cybersecurity startup that we invested in las year While expanding outside of Ecuador, they recently opened an office in Santiago to tackle the Chilean market. They have been actively closing deals with banks and retailers in Chile to help them handle their internal documentation more carefully.

The first few months of 2019 have whirred by and we are looking forward to a strong Q2 for Magma supported companies and the ecosystem . We are especially looking forward to announcing a few more investments that we haven’t made public yet. If you are interested in reading more about the Latin American ecosystem, please check out Nathan Lustig’s blog or LatAm List.

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