As the Latin American startup scene has matured, founders and executives of multi-billion dollar companies in the region have started to move on to new ventures.
On Wednesday, TechCrunch reported on Mara, a São Paulo-based startup that aims to “reinvent” the grocery shopping experience for the underserved in Latin America, and its $6 million raise. One of its co-founders is Ariel Lambrecht, who also helped start mobility startup 99, Brazil’s first unicorn.
Today, we look at Yuno, a two-month-old Colombian payments startup which has raised $10 million in a seed round of funding.
The ability to raise a relatively large seed round so soon after inception speaks to the experience of the company’s founders, which include Juan Pablo Ortega, the co-founder of on-demand delivery unicorn Rappi (which as of last July was valued at $5.25 billion) and Julián Núñez, an early Rappi employee.
Ortega and Núñez met at Rappi while working together in the payments team as that company was expanding to 9 different countries. Ortega built and scaled Rappi’s payments and fraud teams and capabilities while architecting the buildout of Rappi’s financial services arm, RappiBank. Núñez created Rappi’s one-click checkout, Paga con Rappi, and led Rappi’s e-commerce business unit.
That experience managed to attract investors such as Andreessen Horowitz (a16z), Monashees and Kaszek even at a very early stage.
Silicon Valley-based A16z provided an initial investment for Yuno as part of the firm’s program for fintech startup founders. Monashees and Kaszek followed as co-leads in the investment.
Despite its only recent inception, the concept behind Yuno came to Ortega as early as 2015 when he helped start Rappi. Over the last few years, he has witnessed companies of all sizes “struggling to keep up with integrations to be able to offer their customers all the various payment methods available.”
“On top of that, fraud and the cost of processing payments are both increasing, creating another problem for companies,” he added.
He teamed up with Núñez in 2021 to start working on tackling those challenges. The pair decided to formally found Yuno, in January of 2022. After a conversation with a16z, they got their first check and a few weeks later, they closed their $10 million seed round.
The speed at which the duo managed to raise the capital is indicative of the booming startup scene in Latin America, which has seen the number of venture capital dollars flowing into the region essentially explode in recent years.
Put simply, Yuno wants to bring to Latin American companies an easy online checkout solution that solves the pain point of managing multiple payment methods, as well as fraud detection tools, which can be costly and painful to manage.
A “fragmented and complex market” makes it even harder for companies, who have historically been forced to integrate many different payment providers because of low acceptance, high fraud and low conversion rates, said Ortega.
“Accepting and optimizing online payments shouldn’t be a pain for companies. We want to build the ultimate solution to help them make online checkout fast, easy and safe so that companies can focus on their core business,” said Núñez.
Yuno is already working with Rappi as well as several “large-sized” e-commerce companies in Latin America.d.
“In just a few months we have built a team with experience in the space – engineers that built the first payment gateways in LatAm, a commercial team with experience from the biggest payment processors in the world, an extended network in LatAm and beyond,” Ortega said.
Presently, Yuno has 40 employees who hail from companies such as Rappi, Ingenico, Worldpay, McKinsey & Co. and Mastercard. It expects to have 100 employees – mostly engineers – by the end of April.
“We are focused on bringing the most talented people in the region to continue tackling this huge opportunity across LatAm,” said Oretga. “We have already experienced the problem of optimizing payments at Rappi and have created a successful solution for the company. Now we are committed to bringing the solution to the market to make sure no other company suffers that same pain point in the future.”
Initially, Yuno’s focus is on Mexico, Brazil and Colombia. It then plans to expand throughout Latin America and other regions of the world.
Naturally, its investors are very enthusiastic about the company’s prospects.
Marcelo Lima, partner at Monashees, noted that Latin America’s payment ecosystem has been through a “radical” digitization process in the past couple of years.
“However, there are still huge pain points in how merchants get paid, how these payments are orchestrated and how to provide a seamless experience for customers,” he said. “It’s a multi-billion dollar problem in the region.”
Monashees’ Fabiola Quinzanos echoes Lima’s points, adding that online commerce penetration in particular is growing very fast in the region. As such, she added, “a solution that addresses the main problems associated with the suboptimal payments and customer experience that many platforms offer – such as low approval rates, long and broken processes and poor fraud management – is certain to gain a lot of traction.”
She lauded the founders’ extensive experience in payments, saying they have been “battle-tested” at Rappi, one of the most remarkable high-growth stories in LatAm.
“They’re bold, they’re magnets for talent, and have chosen a very attractive market with huge pain points to be solved,” Quinzanos added.
Kaszek Partner Nicolas Berman describes the startup as “an extraordinary and unique company, given the level of experience, technical expertise and audacity to go after big opportunities.”
Nazca, Latitud, OneVC, Opera Ventures, Saurabh Gupta, partner of DST Global and angel investors including Simon Borrero, Co-founder and CEO of Rappi, Ricardo Weder of Justo, Sujay Tile of Merama, Gerry Giacomán Colyer of Clara, Enrique Villamarin of Tul, Maria Echeverri of Muni and the Bilbao brothers also invested in Yuno.
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This article was originally published on TechCrunch.com. Read More on their website.