Latin America PE/VC Report - March/April 2016

Welcome to the March/April edition of the Latin American PE/VC Report. Private equity and venture capital investors remained active in the region in 2015, despite macroeconomic headwinds, with US$6.5b deployed through 310 transactions, according to 2016 LAVCA Industry Data released in early March.

LAVCA also recently published a series of Country Level Public Policy Overviews for Brazil, Chile, Colombia, Mexico, and Peru, which includes information on fund formation rules and restrictions around the role of institutional investors in each market.

SAVE THE DATE for LAVCA Week, September 26-29. As a reminder, qualified candidates can now apply for the LAVCA/Wharton LatAm PE Professional Development Program, taking place in Miami on November 14-17.

I hope you enjoy this month’s profiles of LAVCA Member firm Actis, featured LP Lexington Partners, and Brazilian entrepreneur Adriano da Rocha Lima, CEO & Founder of WebRadar.

Best,
Cate Ambrose
President and Executive Director
Latin American Private Equity and Venture Capital Association

Executive Briefing

Beyond the Headlines: What’s the Deal in Mexico and Brazil?

Conventional wisdom has it that the PE/VC opportunity in Latin America is never quite as good or as bad as the headlines and investor herd would lead us to believe. Earlier this month LAVCA published data on 2015 PE/VC activity in Latin America, and never has it been more important to look beyond the headlines to understand the real market dynamics, particularly in the region’s main economies of Brazil and Mexico.

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Profiles of the Month

Member Profile: Michael Harrington & Mike Till, Actis

LAVCA caught up with Mike Till, Co-Head of Actis’ Energy Business and Michael Harrington, Partner of Actis’ Energy Business to learn more about the energy needs in Latin America and the opportunity for alternative energy and power generation. As Head of Actis’ new Mexico Office, Harrington also spoke to the extensive reform of its energy market which adds momentum to Actis’ investment thesis in the power sector.

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LP Profile: Jose Sosa del Valle, Lexington Partners

On the heels of opening a new office in Chile, LAVCA spoke with Jose Sosa del Valle, Principal of Lexington Partners, to hear about the bourgeoning secondaries opportunity in Latin America.

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Entrepreneur Profile: Adriano da Rocha Lima, WebRadar

Brazilian startup WebRadar is an international breakout in the big data space, crunching billions of data points per hour to drive efficiencies for clients in three sectors (telco, transportation and energy). Following a R$40M investment from Qualcomm Ventures and DGF Investimentos, LAVCA spoke with WebRadar co-founder and CEO Adriano da Rocha Lima about their newest product release at Mobile World Congress 2016, relationships with strategic investors, and expansion plans.

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Featured Article: Are Private Equity Professionals Prepared in Latin America?

By Victor Serra, Managing Director, MVM Consulting
class="first">Private Equity is a highly challenging industry and it has seen impressive growth in Latin America over the last decade. As with most businesses, people are the key performance driver. But, in an industry that is relatively new in the region, are there enough qualified private equity professionals to support its growth?

In this article Victor Sera explores the qualities that make a PE/VC fund manager a success and how best to acquire a skillset through time, experience, and education.

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Featured Article: When Exempt Doesn’t Mean What You Think: Guidelines for Latin American Investors

By Don Andrews, Partner, Venable and Philip von Mehren, Partner, Venable

In the aftermath of the sweeping Dodd-Frank Act, the word “exempt” is a misnomer when it is applied to various classes of advisers, including Exempt Reporting Advisers with and without a U.S. presence. Don Andrews and Philip von Mehren, both Partners at Venable, explore the complex requirements of foreign Exempt Reporting Advisers (e.g. either Latin American funds with no U.S. office or with a U.S. office but less than $150 million under management) to abide by many of the same rules as Registered Investment Advisers.

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Deals & Latest Industry News

Colombia’s Government Launches PE Agribusiness Fund (en español)

(Fiduagraria) Colombia’s government has launched Capital Fértil, a new PE agribusiness fund that will seek to raise up to COP1bn (US$326m) from local and international investors.
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CDPQ Appoints Alonso García-Tamés as Managing Director of CDPQ México and Head of Latin America

(Press Release) Caisse de dépôt et placement du Québec (CDPQ) announced the appointment of Alonso García-Tamés as Managing Director of CDPQ’s México subsidiary, CDPQ México, and Head of Latin America.
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Aqua Capital Acquires Controlling Stock of Animal Nutrition Company “Yes”

(Press Release) Agribusiness private equity firm Aqua Cpaital has acquired a controlling stake in Yes, a Brazil based animal food manufacturer.
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H.I.G. Capital Completes Strategic Investment in Halex Istar and Isofarma

(Press Release) H.I.G. Capital, a leading global private equity investment firm with US$19b of equity capital under management, is pleased to announce it has completed a strategic investment in Halex Istar to facilitate the acquisition of Isofarma, both leading manufacturers of pharmaceutical parenteral solutions in Brazil.
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Capital Group & Other Stakeholders Exit STP Through Sale to Fleetcor for R$4b (em portuguêse)

(E & C Business) CCR, in addition to other stakeholders – including Capital Group, sold Serviços e Tecnologia de Pagamentos (STP), owner of Sem Para, to DBTrans, which is owned by Fleetcor.
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WikiHow Acquires NXTP Labs’ GuideCentral (en español)

(NXTP Labs) WikiHow has acquired NXTP Labs portfolio company and DIY site, GuideCentral.
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CFN Designates US$48m Toward Ecuador’s First Venture Capital Fund (en español)

(El Telegrafo) The Corporación Financiera Nacional (CFN) will designate US$48m to form Ecuador’s first venture capital fund as announced by the institutions President, María Soledad Barrera.
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Inseed Investimentos Invests R$4m in Agribusiness Startup, Tbit (em portuguêse)

(Baguete) Brazilian agribusiness startup Tbit has received a Series A investment of R$4m from Inseed Investimentos.
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Passeidireto.com Closes R$23m Investment from Bozano Investimentos, Redpoint e.Ventures & Valor Capital (em portuguêse)

(Baguete) Online education platform Passeidireto.com has received a R$23m investment round from U.S. education company Chegg, Bozano Investimentos, Redpoint e.ventures and Valor Capital.
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Afluenta, the Leading Latin American Peer Lending Network, Receives US$8m from IFC and Elevar Equity to Expand in the Region

(Press Release) Afluenta, a Latin American peer-to-peer lending network, announced the completion of its Series B funding round from the International Finance Corporation (IFC) and Elevar Equity, an impact venture capital firm. IFC and Elevar Equity are investing US$4m each.
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Aker Security Solutions Closes New Investment Round from Invest Tech (em portuguêse)

(Baguete) Aker Security Solutions, focused on cyber security and information, received an investment round from Invest Tech. The investment was made through the fund Capital Tech II.
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Beauty Date Raises R$28M from Valor Capital (em portuguêse)

(TechCrunch) Brazil-based iFood has bought the on-demand food delivery startup SpoonRocket. Terms of the deal were not disclosed.
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