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LatAm Tech Weekly: Are Valuations Too High?


This article is part of the LatAm Tech Weekly Series, written by Julia De Luca and powered by Nasdaq. Through Nasdaq’s global network, we partner with Latin American companies to support their entire business lifecycle to elevate their brand and access the global markets. Learn more about Latin American Listings here.

I will start with a couple of important announcements:

  • In-person events are back! Latitud will be hosting its first Vamos LatAm Summit on September 22nd. VLS is a full-day event for tech startup founders, investors, and builders from all over Latin America to connect. I will be there and also managed to get a 25% discount on the ticket for my readers! Don’t miss out, use the code julialuca25 and buy your tickets here. There are limited spots, so hurry!

  • Cubo Itaú, the biggest tech ecosystem in Latin America, is also doing an event on September 28th. CuboConecta is back - and you can join live from anywhere by signing up here. If you are a venture capital fund and would like to join in person, respond to this newsletter!

  • G2Day: G2D’s Investor Day - Online on September 1st starting 09:30AM brt: exclusive event where the team will go over G2D's main accomplishments and thesis in the past year and the most relevant trends in venture capital. There will also be special guests from companies such as The Craftory, CERC, Digibee and iClima Earth. Click here to sign up!

  •  Finally, we are now officially 2000 subscribers!!! I would like to thank all of you for reading, sharing and supporting my work.

Follow me on LinkedIn Instagram or Twitter for daily updates!

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Now on to usual market overview: CB Insights released its Tech Valuations Q2’22 report this week. In a nutshell, tech startup valuations are still high. While median valuations fell across the majority of investment stages in Q2’22 vs. Q1’22, most remained higher than in 2021 — and dramatically higher when compared to 2020. The recent numbers indicate that private markets are proving to be resilient amidst the current macro scenario. Will that resiliency hold or will tech startup valuations fall further?

A modest tech valuation has begun

Now onto Pitchbook data, recent numbers on dry powder shows that the figure is down across private capital funds as a whole. There is currently $3.2T in private capital dry powder, down from $3.7T in 2020. VC was an exception - climbing to $562.4 bn. PE is at $1.2T, off the 2020 high of $1.5T. More details here.

Finally, I read a very interesting piece on TechCrunch Plus written by Battery Ventures that is worth the read. It describes how ARR per employee (APE) is one of the most meaningful efficiency metrics for startups and should be the north star for founders. Basically, the cost structure of cloud companies is driven primarily by people: around 70% of the costs are likely going to relate directly to the startup’s employees. If the focus is to become more efficient, at the end of the day, the employee base is the place to start. The calculation for Breakeven APE is: total expenses/employee. Total expenses should include not just personnel costs, but all expenses. The article goes on describing what should be the target depending on the size of the company (ARR range). Very good read - especially for founders.

APE by ARR range


  • Brazilian unicorn MadeiraMadeira, home furniture one-stop shop, acquired Casatema – its third M&A to date. Casatema sells a variety of children's and adolescent furniture through its e-commerce platform. The terms of the transaction were not disclosed.

  • Trybe, Brazilian edtech, lays off around 10% of its staff (47 people) adjusting to the new scenario of the markets.

  • Moisés, startup that offers an artificial intelligence tool that helps users produce, study, teach, play music, and customize and edit tracks founded by Brazilians raised its USD8.6mm seed round led by Monashees and Kickstart.


  • Julian H. Robertson, the founder of Tiger Management and mentor for a generation of hedge fund managers known as “Tiger Cubs,” died at the age of 90. Robertson built Tiger Management into one of the most successful hedge fund firms, starting with $8 million in assets and growing to more than $21 billion. Known as the “true founding fathers of the modern hedge fund industry."

  • Valor Capital sold 25% of its fund II to the American manager StepStone — a transaction that generates immediate liquidity for its LPs.


  • Belvo, Mexican fintech that enables financial professionals to access and interpret data from their end-users in an easy and scalable way through a single API linked to hundreds of financial data sources, raised a Series A round of USD 53.2mm with Citi Ventures.

  • Itau Unibanco expects to end 2022 with 50% of its systems in the cloud. Roberto Setubal, co-chairman of the board of directors of the bank also affirmed that in around two years, the expectation is that the transition will be 100% complete


  • I hosted one of the fintech panels in the Digitalks Expo event this past Thursday. The event gathered more than 8000 people in São Paulo. We discussed topics such as Open Finance, regulation, innovation and new demands from consumers. If you want to know more, this article from Finsiders covers the panel in detail! (PT)

  • Latú Seguros, startup focused on providing business insurance powered by technology to boost LatAm businesses founded by former Rappi Paola Neira raised a seed round of USD 6.7mm from funds such as Monashees and OneVC.

  • General Atlantic bought ~USD100mm of XP stocks in the past weeks.


  • I participated as a teacher in the StartUp Investor Club course organized by Captable / StartSe. I lectured on the current enviornment in tech: valuations, deals, dry powder and much more. Thank you for the invite.

  • Aviv Kombucha, Brazilian startup co-founded by three friends while living in Stanford (Renata Torres, Glau Nobre, Dayanne Lammel), reaches the mark of 250 points of sale in São Paulo, with plans to expand operations to Rio de Janeiro, Vitória, Salvador and Fortaleza. In 5 years, the objective is to reach 4.200 points of sale and revenue of BRL 25mm.

  • PagSeguro reported better-than-expected 2Q22 results, with net income of BRL 367 million. Net revenues rose by 14% QoQ , driven by a stronger recovery in net take rates and volumes. This yielded operating leverage and better cash flow. Earnings expanded by 5% QoQ and 35% YoY. Top-line execution offset higher financial expenses, losses at PagBank and negative effects of POS write-offs.

  • Bitso launches crypto debit card, despite the recent fall in value of cryptocurrencies.

On Another Note

What did I learn from readers?

A reader sent me a great article from Mertiech written by Durable Growth partners.

TL; DR: Durable Growth and the Compounding Returns of Public SaaS Companies: An analysis of trading and financial data of public Software-as-a-service (SaaS) companies to determine the leading contributing factors to shareholder returns.

“For public SaaS companies, durable growth is the most important factor in long-term value creation. And while short-term dramatic market movements (as we have seen this year) can create or destroy significant value for companies, durable revenue growth over time will outpace negative changes in multiples and dilution. High share price returns in the public markets for SaaS companies are about time in the market vs. market timing. No surprise, the power of compounding is evident in public SaaS returns just like it is in anything else.”

  • Durable long-term revenue growth is the most important factor in returns, defined as the increase in share price from IPO (or multiple of invested capital / MOIC).
  • It’s about time in market, not market timing: If you stay public for a long period of time and can compound revenue growth, regardless of market movements that can affect valuation multiple in the short to medium term, you will create a ton of value as a public SaaS company.
  • The pace of revenue growth, defined in this analysis as revenue CAGR (compound annual growth rate) since IPO, has little relationship to share price returns. The size of a company’s LTM (last-twelve-months) revenue at IPO has no relationship to returns.

What am I reading?

What did I listen/watch?

Quote of the week:

“People don't buy what you do; they buy why you do it.” - Simon Sinek

Originally published on my Substack.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Julia De Luca

Julia De Luca is part of the investment banking team focused on tech coverage at Itau BBA. With more than 10 years of experience in finance, her focus is to connect global players to the Latin American tech ecosystem – with content, intel and opportunities. Julia co-authored the book Brazil Fintech and constantly writes columns on the topics of open banking, venture capital investment, regulation and LatAm tech trends. Julia started her career as Global Investor Relations at Gávea Investimentos and also spent a couple of years at Stone Co. She holds a degree in Economics from Pontificia Universidade Católica (PUC-Rio). She is also a columnist at MIT Tech Review, ION and Inteligencia Financeira.

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