LatAm dealmaking still trending down

Dealmaking fell 19% by volume and 29% by aggregate value across Latin America in 3Q23, compared with the same period of 2022, according to a quarterly report published by TTR Data. 

The figures include M&As, private equity, venture capital and asset acquisition transactions. In January-April, there was a 32% year-on-year drop in the number of deals and a 35% decline in the aggregate value.

Brazil was the top dealmaking market of the six Latin American countries included in the study, leading by deal volume and aggregate value in the quarter. In terms of volume, Chile took second place, followed by Mexico, Colombia, Argentina and Peru. 

However, the ranking was slightly different based on aggregate value, with Mexico in second place, followed by Chile, Peru, Colombia and Argentina, in that order.

In Brazil the transactional market saw a total of 1,425 deals and 158bn reais (US$31.2bn) in value year-to-September, down 27.5% and by 35.2% year-on-year, respectively, according to TTR.

In 3Q23 alone, TTR tracked 452 announced and completed transactions for a total value of 57.7bn reais.

The internet, software & IT services sector led the way with a total of 277 transactions in July-September, down 30% compared with the same period of 2022.

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Meanwhile, innovation platform and startup hub Distrito mapped US$883mn in Latin American startup investments across 176 funding rounds in 2Q23, which was a 42% year-on-year decline. 

In value terms, there was a 22% increase compared with the previous quarter. According to Distrito, fintechs remain the leading targets, with US$208mn raised in 25 rounds in the quarter.

Brazil accounted for 67% of the total investment volume in startups in the region, with US$597mn in 3Q23, up 54% quarter-on-quarter, but down 16% year-on-year, Distrito said.

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Brazilian fintech Zink acquired for an undisclosed amount the local firm Size, which is focused on offering credit for the B2B segment.

Founded in 2020, Zink said it established relationships with clients such as XP Investimentos, Banco Digimais and Banco Alfa. Created 12 years ago, Size operates mainly in advancing receivables, offering approvals in just two minutes and enabling entrepreneurs to access credit on the same day, said Zink.

Together, the two companies claim to have granted more than 2bn reais in credit to over 38,000 customers, processing a monthly volume of more than 250mn reais in “new opportunities”.

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Two out of 22 Latin American startups that participated in the “Pre-event Workshop OktoberINVESTfest LATAM 2023”, held in Chile, were selected to exhibit at the next stage of the event at Fundación Chile on October 18.

The initiative is part of an international cooperation between Chile and Germany to promote Latin American technology-based startups for possible investment in Germany in the framework of the OktoberINVESTfest LATAM event. 

Those selected were Quelp (Chile) and Bio Natural Solutions (Peru). They were chosen by a team of specialists.

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Brazil, Argentina and Mexico are, in that order, the three largest markets for investment and adoption of cryptocurrencies in Latin America, according to Chainalysis study of the Geography of Cryptocurrency.

Brazil ranks ninth in the global ranking of adoption of digital assets. Argentina and Mexico appear in 15th and 16th place, respectively. According to Chainanalysis, Venezuela and Argentina “stand out as examples of crypto’s unique utility”.

The study considers different factors related to the digital asset ecosystem to rank the markets, particularly the total invested locally in cryptocurrencies. The details of the study can be seen here.

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Global professional consultancy Deloitte inaugurated an open innovation center in São Paulo, Brazil, with the stated goal of fostering the local digital ecosystem. The 1,440m² hub is on the seventh floor of the company's building in the city.

Dubbed DotHub, the space is aimed at fostering entrepreneurship and the connection of the country's business ecosystem “by forming a community with the participation of startups, large corporations, investment funds, among other key players,” Deloitte said.

Computer manufacturer Acer, startup Mindself and the FITEC institute of science and technology are Deloitte's first partners at the center.