More VC Funds Emerge in LatAm, Interest in Tech Talent Grows

Earlier this month, Japanese fund SoftBank saw the departure of two of its key fund managers for Latin America when Shu Nyatta and Paulo Passoni left their positions to launch their own venture capital fund in the region.

And that was not the only movement that occurred within the Japanese giant, which announced the spin-off of Upload Ventures, for investing in early-stage startups.

A day later, Argentine fintech unicorn Uala announced the launch of its venture capital fund 17Sigma, which will invest US$30 million in early stage startups and will focus on seed and pre-seed rounds.

These developments have taken place in a context in which venture capital is flowing within the region as never before. In 2021, there was $15 billion in venture capital investment in Latin America, a record amount, according to the Latin American Private Equity Association (LAVCA), and that amount could be surpassed in 2022.

And although the growth of venture capital investments seems to be a positive sign, the region is suffering macroeconomic problems, and one of the victim companies turned out to be Netflix.

Latin America’s Economic Crisis Impacts Netflix

The leading streaming platform reported its first drop in users in more than a decade of operation in its financial report for the first quarter of 2022. In Latin America, the decrease in subscribers is due to the economic crisis in the region and the price adjustment for its subscribers.

Netflix CFO Spencer Neumann said in the recorded investor call that due to seasonal macroeconomic difficulties in Latin America last year, the company began testing different ways to monetize account sharing in a trial version that is running in Chile, Costa Rica and Peru.

The Need for Tech Training

But the macroeconomic crisis is not the only one in Latin America. The region is also experiencing a crisis in finding sophisticated talent with technological skills amid the demand for tech vacancies.

Seven of the 10 most in-demand jobs globally in 2022 are in the technology sector, according to LinkedIn. According to the social network, among the most sought-after posts are site reliability engineer, application engineer, infrastructure engineer, machine learning engineer, site specialist, cybersecurity expert, and cloud security architect. But the demand for these positions is not being met due to a lack of training.

Despite the fact that every year, 81,500 students graduate from a technology-focused career, according to an Ipsos study, vacancies are not easily filled because candidates lack practice, or do not master the most-used tools in this industry.

Tech companies and startups have stepped in to address the problem of a shortage of sophisticated talent. Among them are Google, which has launched courses in four areas: IT support, data analytics, project management and UX (user experience) design.

Likewise, logistics startup Cargamos has launched a bootcamp to train young people and adults in the development of applications and digital solutions. The initiative will begin in Guatemala, but according to the organizer Víctor Herrera, co-founder of Cargamos, the intention is to bring the programming bootcamp to more people.

And Mexican unicorn Konfío has also joined the training era, although in its new streaming academy it will not only educate in technological subjects, but also in financial topics, human resources, coaching, digital marketing, social networks, business strategies, gender equality, psychological skills, and foreign languages.

Latest Acquisitions

Argentine unicorn Globant announced this month is had acquired Uruguayan company GeneXus, which was founded in 1988 and has been a national reference in the tech sector in Uruguay, providing solutions for 9,000 companies in 50 countries.

Meanwhile, Italian drive-to-store startup ShopFully, which brings consumers to physical stores through digital channels, acquired Spanish company Tiendeo for 35 million euros ($37.4 million) in a bid to reach the Latin American market, which represents a third of the turnover of the Spanish startup that digitizes promotional catalogs, and which last year reported profits of 13 million euros.