Startup investment growth in Central and South America increases by 14%... Mexico and Brazil's fintech lead the growth

In 2025, the total investment in Latin American startups increased by 14.3% compared to the previous year, showing a clear signs of recovery. According to a survey released by Crunchbase, the total funding from seed to growth stages reached $4.1 billion (approximately 59 trillion KRW), a significant increase from $3.6 billion in 2024. Particularly centered around Mexico and Brazil, large transactions in the fintech sector have continued to emerge, and venture capital firms remain optimistic about the region’s innovation potential.

Although this performance has yet to reach the record $8.4 billion investment level in 2021, it is regarded as an encouraging result that revitalizes the Latin American risk ecosystem. In the fourth quarter alone of 2025, the investment amount reached $1.085 billion (approximately 15.6 trillion KRW), down 16% from the same period last year but slightly up from the previous quarter.

By country, Brazil still maintains the top position in funding, with Mexico rapidly catching up. Brazilian startups raised a total of $2.1 billion (about 3.03 trillion KRW), while Mexico performed outstandingly, with funding soaring 53% year-over-year to $1.1 billion (about 1.58 trillion KRW). Notably, Plata, a fintech startup headquartered in Mexico City, received an additional $250 million in a Series B round after a $160 million Series A, with its valuation doubling to $3.1 billion.

Early-stage investments also grew sharply. In 2025, the total early-stage funding (Series A and B) was approximately $2 billion, a 32% increase from the previous year. Especially in the fourth quarter, $690 million was raised, more than double the same period in 2024.

On the other hand, seed and angel investments performed poorly. In 2025, a total of $540 million was invested in this stage, down 22% from 2024. This is interpreted as partly reflecting risk-averse tendencies in the venture capital market.

Major venture capital firms investing in the region continue to highly evaluate Latin America’s potential. Michael Nicklas, partner at Valo Capital, stated, “As the region’s digitalization accelerates rapidly, technology-driven new business opportunities are surging.” He believes that structural innovation is occurring across multiple sectors such as fintech, logistics, education, and healthcare.

Nicklas paid particular attention to Brazil’s financial infrastructure capacity. He explained that regulatory frameworks such as the government-operated digital identity verification system, instant payment system Pix, and digital central bank currency Drex are laying the foundation for innovative enterprises.

Mexico should not be overlooked either. Damaris Mendoza, partner at 500 Global, emphasized, “Mexico is emerging as a regional hub due to its proximity to the U.S., expanding talent inflow, and abundant opportunities.” She specifically pointed out that, in addition to fintech, vertically integrated AI startups in healthcare, logistics, manufacturing, and infrastructure-centered technology startups have high growth potential.

Haley Bryant, partner at Hustle Fund, shared a similar view. She explained, “After laying the groundwork with digital banking and payments, Latin America is expanding into next-generation fintech such as financial services for SMEs, digital insurance, and asset management.” “Mexico is evolving into a city where entrepreneurs and capital are pouring in.”

Experts emphasize that the Latin American startup ecosystem is still underestimated, especially as addressing the imbalance in technological infrastructure is creating new opportunities. As more local entrepreneurs with technological strength and resilience emerge, the likelihood of more global companies accelerating into the region in the medium to long term is also increasing.