1Mby1M Virtual Accelerator Investor Forum: With Hernan Fernandez of Angel Ventures Mexico (Part 3)

Sramana Mitra: Is FinTech a sector that you have invested more in? This is a global trend.

Hernan Fernandez: Yes. We were lucky enough to be in the middle of the FinTech wave. When we started the fund in 2013, we had no idea that we were going to see FinTech deals. When we started seeing the trends, we realized we needed to build a proper FinTech capacity.

Out of our first fund, we invested in 21 companies, six of which are in FinTech. Two of the top performers are in FinTech. Mexicans banks are getting better, but they are so expensive.

I feel that it’s the right time to disrupt. The Mexican government is quite supportive. Mexico became the first country to enact a proper FinTech law in the world. FinTech is great.

One more investment that we made is Urban, a B2C/B2B2C mobility play. We met with the investors of Swivel from Egypt. It’s quite interesting in the sense that it’s a pure emerging markets play. At this time, there was a company called Chariot that dealt with mobility for workforce.

If you try to do this in Boston or San Francisco, public transportation works quite well. Financing for cars is very cheap. It’s not something that you need to work on. In places like India or Mexico, you have all these people that are between public transportation that can sometimes be bad or very inefficient. The next best alternative is something like Uber Pool.

There’re so much opportunities to innovate in that space. I’m very confident that the first unicorn that we’re going to see in that space is going to be either Swivel or Shuttle. I think the Latin American component are also going to be very dominant.

We’re going to see more and more of this pure emerging market play. Even Amazon had to adapt to COD in Mexico. Mexico is their fastest market to grow to $1 billion in sales. 28% of Uber’s revenues come from Latin America. Latin America’s consumers are growing in terms of purchasing power.

A few months ago, Softbank committed $5 billion to the region. We’re starting to see interest from Sequoia’s and Axel’s of the venture world. It’s certainly an interesting place to be in right now.

Sramana Mitra: Very interesting. Would you say the bulk of your portfolio is B2C?

Hernan Fernandez: It’s split but tilted towards B2C. We have a few B2B plays as well. FinTech is pretty big. We have done some things in e-commerce and learned some hard lessons along the way. Healthcare is an opportunity. Certainly some B2B plays in logistics. A Korean beauty company is now expanding into Latin America.

This segment is part 3 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Hernan Fernandez of Angel Ventures Mexico
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