Recognized as one of the world’s most influential companies by Time, and one of the most disruptive by CNBC, Brazil’s Nubank has dazzled with its ability to save people from the notorious bureaucracy and fees of the country’s banks. Today, the fintech has closed a funding round with what is arguably the biggest tick of approval that any business could dream of - an investment from Warren Buffett’s Berkshire Hathaway.
Since launching 8 years ago, Nubank has been able to successfully disrupt a challenging banking industry within Brazil to prove to customers that they simply deserve better, and that it was possible. The digital bank is best known for being a credit card issuer within Brazil, which is also known as Latin America’s largest economy. The nation has a population of 213 million who have, for decades, only had access traditional banking run by a handful of big institutions. Despite this, around 50% of the population do not have banking services, and the penetration of credit cards sits around 21% (compared to 70% in the U.S.).
Since successfully tackling this market, Nubank has quickly become the largest fintech in Latin America, and one of the largest in the world. The company boasts 40 million users in Brazil, Mexico and Colombia. Beyond credit cards, the company has launched a host of other financial products such as checking accounts, and loans. The company has focused on attracting world-class talent such as the recent hires of Matt Swann as CTO, and Arturo Nunez as CMO. It has also successfully begun expanding into the new regions of Mexico and Colombia with significant numbers of applications already netted in both regions. And, recently the company has made significant acquisitions toward growth such as purchasing one of the main digital investment platforms in Brazil, with more than $5 billion in assets under custody and 1.6 million clients.
It comes as little surprise that Nubank has attracted the approval of Warren Buffett, given the market potential of Nubank’s customers and its proven successful strategies. As the world’s most successful and renowned investor, Buffett’s approval goes a long way in predicting the success of a company. Despite his many investments, Buffett does not often invest in tech, which makes this all the more significant. This will be only the second investment Buffett makes in a Brazilian fintech, proving interest in the region. Berkshire Hathaway has invested $500 million in this latest investment round, with an additional $250 million from a series of other investors.
Speaking on the investment, Nubank’s Founder and Chief Executive, David Velez said, “This for us is a huge validation of what Nubank has been doing since the very beginning.”