Once overlooked by the global tech industry, Latin America (LatAm) will be the region best positioned to see tech “unicorns”—particularly fintech startups—emerge as game changers and industry leaders by 2024.
Latin America emerges as top source of tech unicorns
Companies around the world are realizing the benefits of the region’s new technology talent and market potential and are flocking to join the region’s explosive growth.
The recent rise in the area can be attributed to large-scale venture capital investment in recent years. Raised $15 billion in 2021.
This funding comes primarily from U.S. companies that recognize the region’s growing IT sector, accessible fintech tools, and the acceptance of financial inclusion solutions by industry regulators—all of which are critical to driving fintech.
Brazil and Mexico currently lead the world in terms of the number of unicorns valued at over $1 billion, and this growth is expected to continue through 2024 and beyond, as a recent report shows. QI Tech Rises to Unicorn Status In that area.
“Given its place in the technology industry, it is clear that the Latin American market cannot be underestimated,” said Jeremy Baber, CEO of Lanistar.
“By investing in fast-evolving fintechs, LatAm is quickly establishing itself as a next-generation key leader in terms of talent and development company potential.
Once considered an immature region, by 2024, many will be looking to Latin America, particularly Brazil and Mexico, as leaders in fintech investment and technological advancement. Latin America’s growth is already outpacing established regions, particularly in the fintech sector, driven by the need for financial inclusion solutions.”
Baber agrees that the area’s popularity and growth is due to its tech-heavy workforce and proximity to the United States.
“Not only do Gen Z and Millennials favor new fintech developments for their convenience, they are also more tech-savvy than previous generations and are more eager to embrace the future of technology and additional careers in IT.
Likewise, real-time collaboration with the US is easier thanks to the shared time zone, which means more investment in local locations rather than outsourcing globally.
The ability to interact during business hours will strengthen your business relationships.
Latin American governments and regulators have proven to be more supportive of fintech, cryptocurrencies, and new financial developments, as seen in El Salvador.
The fintech sector is driven by a desire for change and a need for next-generation key technologies to thrive, and regions that align with these values can be particularly powerful forces for fintech unicorns.
This is certainly true in Brazil, which has one of the best sources of fintech development.
Without a doubt, with continued support through improved education, government initiatives and encouragement of digital innovation, the country will see even greater growth in the fintech sector that the market can capitalize on.”