south america

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These startups are locating in SF and Africa to win in global fintech

To become a global fintech player, locate your company in San Francisco and Africa.

That’s the approach of payments company Flutterwave, digital lending startup Mines, and mobile-money venture Chipper Cash—Africa-founded ventures that maintain headquarters in San Francisco and operations in Africa to tap the best of both worlds in VC, developers, clients, and the frontier of digital finance.

This arrangement wasn’t exactly coordinated across the ventures, but TechCrunch coverage picked up the trend and some common motives among these rising fintech firms.

Founded in 2016 by Nigerians Iyinoluwa Aboyeji and Olugbenga Agboola, Flutterwave has positioned itself as a global B2B payments solutions platform for companies in Africa to pay other companies on the continent and abroad.

Clients can tap its APIs and work with Flutterwave developers to customize payments applications. Existing customers include Uber,  Booking.com and African e-commerce unicorn Jumia.com.

The Y-Combinator backed company is headquartered in San Francisco, runs its operations center in Nigeria, and plans to add offices in South Africa and Cameroon.

Flutterwave opened an office in Uganda in June and raised a $10 million Series A round in October. The company also plugged into ledger activity in 2018, becoming a payment processing partner to the Ripple and Stellar blockchain networks.

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SoftBank makes a huge bet on Latin America

Rappi represents a new era for Latin American technology startups.

Based in Bogotá, Colombia, the on-demand delivery startup has taken the region by storm, attracting a record amount of venture capital funding in mere months. Today marks the beginning of a new round of explosive growth as SoftBank, the Japanese telecom giant and prolific Silicon Valley tech investor, has confirmed a $1 billion investment in the business.

The king-sized financing comes two months after SoftBank announced its Innovation Fund, a new pool of capital committed to spending billions on the growing tech ecosystem in Central and South America.

VC funding in Latin America catapulted to new heights in 2018. Startups located across Argentina, Brazil, Chile, Colombia and more have secured nearly $2.5 billion since the beginning of 2018, according to PitchBook, up from less than $1 billion invested in 2017.

SoftBank plans to transfer the Rappi investment to the Innovation Fund “upon the fund’s establishment,” according to a press release. For now, the SoftBank Group and affiliated Vision Fund will each invest $500 million in the company. Jeffrey Housenbold, a managing director at SoftBank responsible for investments in Brandless, Opendoor and DoorDash, will join Rappi’s board of directors.

“SoftBank’s vision of accelerating the technology revolution deeply resonated with our mission of improving how people live through digital payments and a super-app for everything consumers need,” Rappi co-founder Sebastian Mejia said in a statement. “We will continue to focus on building innovations for couriers, restaurants, retailers and start-ups that translate into new sources of growth.”

Mejia, Simón Borrero and Felipe Villamarin launched Rappi in 2015, graduating from the Y Combinator startup accelerator the following year. It didn’t take long for the business to capture the attention of American VCs, including the likes of Andreessen Horowitz, DST Global and Sequoia Capital .

The latest round, the largest ever for a Latin American tech startup, brings Rappi’s total raised to date to a whopping $1.2 billion. The company was valued at more than $1 billion last year with a $200 million financing.

Rappi is among few venture-backed “unicorns” based in Latin America. São Paulo-based Nubank, a fast-growing fintech startup, garnered a $4 billion valuation last year with a $180 million investment.

Rappi didn’t immediately respond to a request for comment.

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This tiny house grows with your family

Tiny houses are all the rage, but once you put more than a few people in one you have a problem: Where can you go from there?

Nowhere. Exactly.

What you do is, if you need that extra push over the cliff, you know what you do? Talk to Brian Gaudio. Gaudio is the founder of Module Housing, an incremental-building startup from Pittsburgh. Gaudio, formerly of Walt Disney Imagineering, has an architecture background and saw firsthand the need for incremental housing in his work in Biloxi and Latin America. His idea is simple: create a little house that grows with you over time, allowing a single room to turn into a mansion with a few turns of a wrench.

“We think of the home as a recurring revenue stream — buy a starter home today, purchase additions and upgrades in the future. All our homes are designed to change over time — as a homebuyer’s family grows, income grows or needs change,” he said. “We are capital-light compared to other prefab startups in that we don’t own the manufacturing facilities where our homes are built. We leverage existing network of high-performance prefab manufacturers on the East Coast.”

The service does it all: They offer multiple-room dwellings and work with you to order the modules, find land that lets you add on over time and assemble the houses. Like the Craftsman houses of old, you have a few basic styles, but in this case you can buy a one-bedroom Nook house for $212,000 and then add on over time instead of buying a house with seven rooms and realizing you only needed two.

Additional costs include building a foundation and land preparation. It’s also dead easy to add onto your house when you’re ready, said Gaudio, thanks to work they’ve done in modularizing the houses.

“We have patents pending on a removable roof and wall system that simplifies the addition process when a customer is ready to add on,” he said.

The company has raised $1.2 million so far and they have prototype houses in Pittsburgh. They already have orders and they’ve created a Tesla-like reservation system for the folks who want to try out their product.

“I moved back to Pittsburgh to start Module with the goal of making good design accessible to everyone,” he said. “Affordable housing is one of the most critical issues our country faces today. Module is a vehicle to promote responsible, equitable development in cities. We are reimagining housing to be more sustainable, adaptable and better designed.”

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Latin America’s Groupon Mafia

 The founders of PayPal and its employees have produced many highly successful companies over the years. Often referred to as the “PayPal Mafia” because they’ve had such an impact on the startup ecosystem, this serial entrepreneur success story is reminiscent of a similar phenomenon taking place in Latin America. The story starts with another U.S. company, Groupon. Read More

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A Look into Chile’s innovative startup government

View of the Andes, plants and city from Santa Lucia Hill, Santiago, Chile For better or for worse, Chile is often held up as the economic model for Latin America. More so even than other up-and-coming tech centers, the story of startup entrepreneurialism in Chile is a story of concerted government policy. That policy is formulated by the Corporación de Fomento de la Producción de Chile, which is tasked with promoting economic growth in the country. Read More

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