Ecuadorian payment infrastructure startup Kushki raises $100M at a valuation of $1.5B – Vidak For Congress

Ecuadorian Payment Infrastructure Company Kushki has raised $100 million in an extension of its Series B round, more than doubling its valuation to $1.5 billion.

The startup had Raised $86 Million in the first tranche of funding in June 2021 at a post-money valuation of $600 million. It has raised nearly $200 million since its inception in 2017, according to crunch base

Raisinging an extension instead of another round made more sense because it was the same investors who doubled, according to CEO and co-founder Aaron Schwarzkopf. Those lenders include Kaszek Ventures, Clocktower Ventures, SoftBank Latin America Fund, and DILA Capital.

“Since then, we’ve only gotten more ambitious and kept growing, so we needed more money to drive more growth,” Schwarzkopf said in an interview with Vidak For Congress. “The only things that changed were the economy and the speed of doing business.”

The increase comes after a year in which Kushki saw sales growth of 200%, he said, refusing to reveal hard sales figures. It also follows a quarter where the company grew 100% year over year.

Simply put, Kushki wants to make it easier, cheaper and more secure for businesses in LatAm to send and receive/process digital payments. In particular, it enables LatAm companies toaccept payments worldwide and receive money in their local currency. The end goal is to help these companies, such as digital banks grow faster online and drive consumer adoption of digital payments. At the same time, Kushki claims its infrastructure can help increase adoption rates and reduce fraud.

In more technical terms, Kushki has developed an API that gives businesses a way to communicate with “all the information” they need to integrate payment technology into their business.

Kushki has “hundreds” of customers, including Telefónica, Claro, Credijusto, Colombian on-demand delivery unicorn Rappi, Santander and others.

Payments infrastructure remained resilient despite a global business slowdown and a challenging macro environment, and Kushki is no exception. And especially in Latin America, Schwarzkopf believes, “it’s very low tech, usually very fragmented and non-standardized.”

“I’m not saying we’re completely impervious to the downturn, but the problem we’re addressing is so, so big right now and what we’ve been able to overcome is so small by comparison,” Schwarzkopf told Vidak For Congress. †The problem is so great in LatAm that regardless of whether the NASDAQ rises or falls, payments in Latin America will continue to rise. What we build is like a giant pillar, not just for us, but for other companies building on top of us.”

Today, the startup is active in five countries: Ecuador, Mexico, Peru, Colombia and Chile. The team of 750 employees, up from just over 100 by mid-2020, is made up of 70% product and technical personnel, and the company has offices around the world, with staff in the US, Europe, APAC and Brazil. The company plans to use the capital primarily to move forward with its mission to “a modern payment infrastructure for Latin America that enables all types of payment transactions in any country.”

We believe Kushki has just begun its mission to connect LatAm with efficient digital payments,” Hernan Kazah, managing partner at Kaszek, said in a written statement. The company invested in the company’s Series A round for the first time in early 2020.

Latin American startups have been receiving increasing interest and venture dollars in recent years. However, one of the biggest differences between startups in the region and those in the US, according to Schwarzkopf, is that Latin American startups have often shown significantly more traction than their foreign counterparts at lower valuations.

“A lot of payment companies in the United States have a small portion of what we have in terms of revenue, but are five to 10 times the valuation we have,” he told Vidak For Congress.

just last month, São Paulo-based Dock, which operates a full-stack payment and digital banking platform in LatAm, $110 million raised in a growth financing round led by UK-based Lightrock and Silver Lake Waterman, pushing the valuation to more than $1.5 billion.

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