Latin American Venture Capital is Breaking Records This Year It's "a story about talent, and not about capital"Today was the end of our multi-week-long exploration of global venture capital markets' second quarter performance. We've traveled all over the globe to learn more about the flow of capital into startups today. We saved the best for last: Latin America.The Latin American startup and venture capital market is similar to other emerging ecosystems. Latin America, like the U.S., Canadian and European startup hubs, is experiencing record venture capital activity.The Exchange explores markets, startups, and money.It's available every morning at Extra Crunch. You can also subscribe to The Exchange newsletter every Saturday.However, the hidden picture is one of a startup market that is maturing and outside investors looking for breakthrough opportunities.We collected observations and notes from NXTPs Gonzalo, Magma Partners Nathan Lustig, and ALLVPs Federico Antoni to help us explore Latin America's second quarter. Data from Dealroom, CB Insights and the Global Private Capital Association (GPCA), as well as ALLVP, are also available.Today we were looking at the data but also the human potential of the startup rush. Antoni says that the Latin American startup market is about talent and not capital.Startup markets thrive when there is a combination of talent and capital. There are many other reasons Latin American startups are in the news, including strong digital penetration and rapid e-commerce growth.These trends could last a long time. NXTPs Costa presented a bullish argument. The market capitalization of technology companies in Latin America is 2.5%, compared to 40%+ for the U.S. His firm believes that this data set will show that there are many future Latin American public-tech companies being created and funded today.Let's discuss Latin American venture capital data. We will look at which countries are rising stars, how fast startups can cross-border and how rapid capital recycling is in the ecosystem. This is a critical test for the longevity of startup-markets.Venture capital is on the riseLatin America is poised to surpass all-time records for venture capital dollars and venture capital rounds in 2021. CB Insights data shows that startups in the region have raised $9.3B in their first six months of 2021 from 414 deals. According to the same data, in 2020, 526 deals saw startups in the region raise $5.3 billion. In case you were concerned that we were comparing to an unfairly COVID affected year, the 2019 numbers were $5.3 Billion (again) from 614 individual transactions.This year is different. The second quarter 2021 was an exception. Q2 2021 was close to the second quarter 2017 with $2.6 billion in venture capital. This quarter had $7.2 billion.
