May 13, 2021
Learn more about Fontes
QED Investors today announced a $12 million network-driven fund to support seed and pre-seed fintech startups in Latin America.
Named Fontes, the Latin word for fountains, the fund will expand QED’s reach across geographies, business models and teams.
Commitments to Fontes come largely from QED’s deep network within Latin America – including numerous founders and management of some of the region’s most renowned fintech companies. These investors have deep roots within the fintech ecosystem and will play a vital role in cultivating and supporting the next generation of fintech entrepreneurs.
Fontes investments will be supported by QED partners and prominent local entrepreneurs, allowing Fontes founders the opportunity to tap into a wealth of on-the-ground knowledge, expertise and resources. Founders will also benefit from QED’s broader portfolio resources and community while building relationships with its team of operators from the start. Fontes will invest across the Latin America geography in strong founding teams that are working with a fintech element in the business model.
To learn more about Fontes, email us here
As part of the Fontes launch, QED partnered with Finnovista to hold a virtual panel -- Getting it Right: Building Blocks to Get Your Fintech off the Ground in Latin America – with QED Principal and head of the Fontes program Ana Cristina Gadala-Maria, Worky Co-Founder and CEO Maya Dadoo, and Kavak Founder and CEO Carlos Garcia. The panel was introduced by QED Co-Founder and Managing Partner Nigel Morris and moderated by Finnovista Managing Partner Andres Fontao.
You can watch the full replay of the panel below.
Q: What is the envisioned check size for the new fund? What are the requirements to be part of Fontes?
A: Fontes invests up to $500,000 in a first investment, with the potential to invest an equal amount in a subsequent round. We will consider anything from idea stage (no product or revenue), but ultimately we are looking for conviction on the size of the market, the founding team and validation of hypotheses on the problem you’re trying to solve. If you have real traction, revenue or data to validate your business model, even better.
Q: I’m struggling to find experienced technical cofounders or to access seed funding. What are our options? Funds seem to be available but are normally given to countries with larger populations.
A: Risk capital is still scarce in many countries in Latin America, but there is a growing ecosystem and funds are increasingly willing to invest region-wide. Several countries have accelerator programs or incubators that help you get a jumpstart and meet other funds. Start by identifying who are the potential funds that would be a good fit for your company - by stage, region or thesis. There are associations such as LAVCA that have directories of active funds in LatAm. When you meet potential investors, be prepared to show traction, vision, team and product.
Q: When is the best time to approach VCs or funds like Fontes? MVP? Some traction? Idea stage?
A: We like to build personal relationships with founders, so the earlier we meet you, the better. A first call is just that, a first call. We will get to know you and your business over time.
Q: What’s the definition of "embedded fintech"?
A: Embedded fintech is the incorporation of financial services into traditionally non-financial products and services. For example, a restaurant software may start offering financing to restaurants or suppliers. Kavak, a marketplace for used cars, offers financing to actually purchase the car. The core product is not a financial service in and of itself, but a natural extension of the model is to embed financial offerings into it.
Q: If QED has already invested in similar fintech solutions before, there is still a chance to reinvest in other fintechs trying to solve the same problems?
A: If you're solving a similar problem, we'd love to meet you. However, we won't invest in companies that are directly competitive to our portfolio companies.
Q: What kind of characteristics do entrepreneurs should look for in investors?
A: VC investing is a long-term game, and the investor you choose as a partner will be with you for the next 5-10 years. It's important that you see a partner that is aligned to your vision and mission.
Q: How can we apply for the new fund? What's the process to apply to QED as a startup?
A: We love to develop personal relationships and get to know entrepreneurs before we invest. Please send your deck and a quick intro to us and if we see a potential fit, we'll schedule a call to get to know you.