Nubank, a financial technology company operating in Latin America, raised $400 million in venture funding in late July, marking its largest fundraising round to date. With the round, the company achieved a valuation of more than $10 billion.
The Series F round of funding was led by TCV, the growth equity firm with offices in Menlo Park, New York, and London. It represents TCV’s first big investment in the Latin America fintech market. Existing investors Tencent, DST Global, Sequoia Capital, Dragoneer, Ribbit Capital and Thrive Capital participated in the round.
According to media reports Nubank held talks with SoftBank about an investment but talks never amounted to anything. Last fall it had a valuation of about $4 billion after raising capital in a round led by Tencent. Back then it was the most valuable startup in Latin America.
To-date, Nubank, which offers a credit card, rewards, digital savings and personal loans and has more than 12 million customers in Brazil, has raised $820 million in venture funding. The fintech company, which makes money from merchant fees and credit card balances has a partnership in place with Mastercard.
“We remain firm in our mission to fight complexity and give back to people the control of their finances. Even though the technological change has been transformational for most industries across the globe, most banked consumers continue to pay absurd interest rates and fees to receive very poor financial services in return. Additionally, over two billion people still do not have access to basic financial services,” said David Vélez, founder and CEO of Nubank said in a press release announcing the funding raising round. “With this new investment by TCV and our existing investors, we expect to contribute to meaningfully change this situation by accelerating our growth in Brazil and supporting the launch of our new Latin American markets.”
The Latin American market is heating up in terms of venture funding, as VCs look for the next opportunity for growth. The Wall Street Journal reported that $2.5 billion of capital was invested in Latin American startups last year, more than double the amount that went to the region in 2017.
As it stands, Nubank is the sixth-largest financial institution in Brazil. It kicked off its international expansion in May, setting up shop in Mexico and Argentina with plans to be up and running in the next few months. It has expanded beyond credit cards and rewards to include a personal loan account and savings account. It received a license as a financial institution last year and in the early part of 2019 rolled out its personal loan product that’s available to more than 500,000 customers. In addition to using the funding for expansion internationally, Nubank plans to boost its employee headcount significantly during the next few years.
“We are always looking for the best talent in the world. We build strong and diverse teams with professionals from different cultures to jointly challenge the status quo and reduce complexity. We are a technology company by nature and, therefore, we want the best software engineers as part of our global team,” Vélez said in the release.