Barcelona-founded fintech Belvo has raised $10m to hire 40-50 new developers and open up an office in Sao Paulo. It will come as welcome news to the Spanish ecosystem, where the coronavirus crisis is squeezing startups.
With its second hub and main market in Mexico City, Belvo is hoping to take advantage of the fintech boom in Latin America.
“The ecosystem in fintech is exploding in LatAm,” says cofounder Pablo Viguera. “You look at Brazil and Mexico, there are roughly about 500 fintechs in each of those countries and it’s growing 30-40 percent every year.”
Belvo essentially acts as the layer of technology between a fintech app and a user’s financial data, allowing things like budgeting apps to access bank account information.
It’s similar to the San Francisco-founded Plaid, which Visa acquired in January for $5.3bn, but in a regional market with such potential for fintech companies, its possible reach could be even greater.
One reason for this is the low proportion of people with a bank account in Latin America, which Viguera says is as low as 40% in some countries.
“That doesn’t mean that folks don’t want to interact with money and it doesn’t mean people don’t have data that can be leveraged to make money decisions,” he explains.
This is where Viguera hopes Belvo can add real value, by allowing fintechs to access financial data in harder-to-reach places.
One example is gig economy workers, who often get paid into an e-wallet, rather than a traditional bank account.
“That’s pretty valuable data to, for example, decide whether to give that person a loan and how much to charge that person for that loan,” says Viguera. “Creating that single source of truth from these different sources of financial information is particularly tricky in regions like LatAm.”
If Belvo can help the burgeoning Latin American fintech market access this dispersed data, the rewards could be big. And, as one of the rare examples of a Spanish Y Combinator backed startup, Viguera has no shortage of ambition.
“Our big vision is to be the pan-LatAm financial API platform,” Viguera tells me matter-of-factly. “Our goal for 2020 is to be live in the three main markets in LatAm, so Mexico, Colombia and Brazil.”
So, in this time of crisis and uncertainty, Belvo’s big plans and team expansion will come as welcome news to many in the Spanish ecosystem looking for reasons to be cheerful.