LATAM FinTech Investment Plummets in 2024: Why Investors Focused on $100M+ Deals
In 2024, the Latin American (LATAM) FinTech landscape has undergone significant transformations, marked by a sharp decline in deal activity but notable growth in larger investment rounds. This article delves into the key LATAM FinTech investment statistics that define the current market dynamics.
Decline in LATAM FinTech Deal Activity
The LATAM FinTech sector has experienced a considerable downturn in both deal volume and total funding in 2024. The total funding for the year reached $2.4 billion across 140 deals, reflecting a 13% drop from the $2.7 billion reported in 2023 and a 26% decrease from the $3.2 billion raised in 2020.
Key Statistics
- Total funding in 2024: $2.4 billion
- Number of deals: 140
- Drop in deal volume: 56% from 2023
- Drop in deal volume: 69% from 2020
These statistics indicate a consolidating market with reduced investment activity, suggesting a more cautious approach from investors.
Growth in Large Investment Rounds
Interestingly, while the overall funding has decreased, larger deals valued at over $100 million have seen a 5% growth in 2024. This shift highlights a trend where investors are focusing on fewer but larger transactions.
Funding Breakdown
- Funding for deals under $100 million: $1.3 billion (down 24% from 2023)
- Funding for deals over $100 million: $1.1 billion (up 5% from 2023)
The average deal size has also significantly increased, from $7.0 million in 2020 to $16.9 million in 2024, marking a substantial growth of 63%.
Spotlight on Ualá’s Major Funding Round
One of the standout events in the LATAM FinTech scene is the $300 million Series E funding round secured by Ualá, an Argentine neobank. This funding round is one of the largest in the LATAM FinTech sector this year.
Led by Allianz X, with participation from notable investors including Tencent and Goldman Sachs Asset Management, this investment will bolster Ualá’s expansion in key markets such as Argentina, Mexico, and Colombia.
Innovative Solutions and Future Plans
Ualá aims to enhance its personalized financial services using proprietary AI-driven tools like UaláScore, focusing on credit scoring, loans, and investment products. The company’s banking licenses and strategic partnerships position it to continue innovating in both banking and insurance sectors, aiming to provide comprehensive financial services to over eight million users across Latin America.
For more insights into the LATAM FinTech market, check out our latest reports or explore Forbes’ analysis on the sector’s future.
