Acacia Venture Capital Partners

As President-Elect Trump threatens tariffs on Mexico to start his trade negotiations, we review the shift from globalization to nearshoring with Latin America in the spotlight. This article explores the forces driving nearshoring (of which tariffs are just one) and uncovers LATAM opportunities emerging across sectors—from fintech and SaaS to logistics and health tech. Announcements in the coming weeks will set the tone for negotiations that start after January 20th.

🚀 Proud to have our Venture Partner, Mike Narodovich, represent Acacia Venture Capital Partners at the Winter 2024 Growth Summit hosted by Orbit Startups. Check out Mike’s reflections on growth strategy and the VC perspective shared during this event!

🌎 What makes LATAM one of the hottest regions for venture capital today? In Latin America, population growth and economic dynamics are creating a perfect storm of opportunity ⛈. With 663 million people LATAM is primed for growth. Here’s why investors are paying attention: Expanding Middle Class: 35% of LATAM’s population now falls into the middle-income bracket, with disposable income set to rise 60% over the next 20 years (Euromonitor). This creates fertile ground for sectors like fintech, proptech, healthtech, and edtech to thrive. Financial Inclusion: Although many are outside the financial system, cash transactions have dropped from 59% to 30% as digital payments surge. Startups like NuBank, Stori, and Mercado Pago are leading this transformation offering innovative financial solutions. Urbanization Challenges: Rapid urban growth is pushing infrastructure and mobility limits. Companies focused on home delivery (e.g., Rappi) and logistics (e.g., SimpliRoute) are stepping in to meet these challenges. Youthful Digital Demand: With 26% of the population under 30 spending 6+ hours daily online, there’s a strong demand for digital solutions. Edtech innovators like Platzi and Henry are redefining education for this digital-native audience. In 2023 alone, LATAM saw 6,000 startups emerge, with 31 reaching unicorn status. As population trends and economic growth intersect, LATAM’s entrepreneurial and investment landscape is set for unprecedented expansion. 💡 Which sector do you see taking off next? Comment below, or connect with us to discuss LATAM’s future and the opportunities ahead. #VentureCapital #LATAM #FintechInnovation #Startups #InvestmentTrends

As we start engaging Founders, potential LPs, and other Funds this season questions always arise about Acacia's interest in Latin America. Take a look at this post from last week that introduces the LatAm landscape, the first in a series from Acacia. How do you view LatAm market potential?

Latin America (LATAM): The Hidden “Pearl of the Occident” Acacia has long believed in LATAM's potential. We are excited to highlight why the market deserves more attention from VC. While Southeast Asia and India have attracted substantial investment over the past decade, LATAM remains a largely untapped market, now emerging as a hidden gem.💎 In 2023, LATAM's GDP reached USD 6,573 billion 📊. This figure is comparable to China’s GDP in 2010 (USD 6,043 billion), representing 37% of China’s current GDP and 24% of U.S. GDP. This comparison illustrates LATAM’s significant economic scale and reflects an impressive nominal growth rate of 12% 📈, outpacing China’s -1% and the U.S.’s 6% growth. This rapid nominal growth suggests that LATAM offers potential for business expansion 🚀. Although real GDP growth was slower—2.3% for LATAM vs. 5.2% for China and 2.5% for the U.S.—this is largely attributable to currency volatility. Such fluctuations might deter some investors, but the overarching trend of economic growth points to a fertile landscape for startups 🌱 poised to capitalize on this momentum. Examining per capita GDP offers further insight into LATAM's investment potential 💡. In 2022, LATAM’s per capita GDP was USD 9,559, trailing China’s USD 12,720. This figure masks significant variations among LATAM countries. For example, Mexico and Chile—with per capita GDPs of USD 11,497 and USD 15,355 —are experiencing steady economic growth similar to China’s more developed provinces 🏙️. Higher disposable incomes in Mexico (USD 8,560) and Chile (USD 10,920), compared to China’s USD 4,690 underscore the expanding middle class in these countries. This growing consumer base is receptive to e-commerce 🛒, fintech 💳, and other digital services 📱, presenting ripe opportunities for startups focused on these sectors. LATAM’s infrastructure is evolving rapidly, creating a favorable environment for technological growth. Smartphone penetration, which continues to rise, stood at 79% in 2022, with Brazil leading at 86%, Mexico at 81%, and Chile at 70%. Widespread adoption of mobile technology is a critical driver for digital services and technology startups. Reflecting on China’s explosive growth from 2005 to 2015 is helpful to understand LATAM’s future potential 🔍. The parallels between this period and LATAM’s current trajectory suggest that the region is poised for a similar surge. Our experience with the Chinese market positions us uniquely to identify the sectors and companies that will capitalize on this growth wave 🌊 and deliver exceptional returns. With its impressive economic growth, rising disposable incomes 💵, and advancing infrastructure 🏗️, LATAM is a promising investment opportunity and a hidden “pearl of the occident” that can yield significant returns for those who invest wisely 🏆. Contact us to discuss how you can capitalize on LATAM’s economic growth and be part of the region’s success story.

Acacia Welcomes Hector Shibata as Mexico-Based Venture Partner We are excited to announce that Hector Shibata has joined Acacia since June this year as our newest Venture Partner. Based in Mexico Hector brings a deep network 🌐 and extensive experience in venture capital across Latin America, positioning us to strengthen our investments in this dynamic market 📈. Strategic Leadership in Venture Capital Hector has a distinguished career in venture capital, highlighted by his role as Director and Head of the Corporate Venture Capital Fund at AC Ventures. There, he led investments across Latin America, the US, Europe, India, and Israel, demonstrating his expertise in identifying and managing high-potential startups globally 🌎. Champion of Sustainable Innovation At AC Ventures, Hector was part of the team that established the Greycroft Coca-Cola Sustainability Fund, where he focused on investments in climate tech and sustainable technologies ♻️. His commitment to sustainability aligns seamlessly with Acacia’s mission to back ventures that generate long-term societal value 🌱. Global Perspective and Academic Engagement With a career spanning multiple continents, Hector offers a unique global perspective, particularly on cross-border investments in Latin America. In addition to his professional achievements, he serves as an Adjunct Professor 🎓 at Monterrey Tech’s EGADE Business School, where he educates MBA students on Innovation and Entrepreneurship, further solidifying his role as a thought leader 💡. Mentorship and Industry Recognition Hector’s passion for nurturing emerging entrepreneurs has been evident in his volunteer work with organizations like MassChallenge. His influence in the venture capital industry has been recognized multiple times 🏆, including being named to the Global Corporate Venturing Powerlist and speaking at multiple events 🎤. Hector holds an MBA from NYU’s Stern School of Business 🎓 and a Bachelor of Science in Industrial Engineering from ITESM, graduating Magna Cum Laude 🏅. As Hector joins Acacia, we are confident that his deep network, strategic insight, and extensive experience in Latin America will be invaluable to our team. Please join us in welcoming Hector Shibata to Acacia 👏.

Congratulations to our Fund 2 portfolio company Bland AI on a successful Series A raise. We're proud of the team's work in adding such impressive names to their cap table and are excited about the journey ahead.

Listen to our funds' Founder Edmond Hui talking about  learnings from investing in Latin America if you are interested 👇

Excited to share a fascinating podcast episode on Spotify that dives into innovative investment strategies! 🎧 "STRATEGIES FOR INVESTING IN LATIN AMERICA FROM AN ASIAN PERSPECTIVE" This episode explores Acacia Venture Capital Partners' unique approach to investing in Latin America's booming tech scene, drawing parallels with China's market evolution. Learn how they: • Identify promising founders • Leverage cross-border networks • Navigate political and economic risks • Apply lessons from China's tech growth to Latam opportunities Whether you're an investor, entrepreneur, or simply curious about global market trends, this podcast offers valuable perspectives on the intersection of Asian and Latin American tech ecosystems. Don't miss this chance to expand your knowledge of emerging market strategies! Give it a listen and let me know your thoughts in the comments. #VentureCapital #LatamTech #CrossBorderInvesting #EmergingMarkets