FinTech unicorns thrive as LatAm growth outpaces global tech, led by Brazil and Mexico

By Puja Sharma

LatAm region poised as best source of tech unicorns

With growth in LatAm, particularly with Brazil and Mexico, outpacing global tech potential, FinTech unicorns are thriving in the region more than ever

Once overlooked by the global tech industry, 2024 marks Latin America (LatAm) as the best region for tech “unicorns”, and particularly FinTech start-ups, to emerge as game-changers and industry leaders. Worldwide, businesses are realising the advantages of the region’s emerging tech talent and market potential and are flocking to be part of the exponential growth in the region.

The region’s recent rise can be attributed to mass venture capital investment in recent years, with almost $15 billion raised in 2021. This funding comes mainly from companies in the US that have recognised the power of the region’s growing IT sector, accessible FinTech tools and acceptance of financial inclusion solutions via industry regulators – a factor that is extra important in driving FinTech. 

Brazil and Mexico currently lead with the most unicorn companies valued at over $1 billion, and this growth is set to continue throughout 2024 and beyond, as already shown in the recent rise of QI Tech to unicorn status in the region.

“It is clear that the LatAm markets cannot be underestimated when it comes to their place in the tech industry,” said Jeremy Baber, CEO of Lanistar. “By investing in fast developing FinTechs, LatAm is quickly securing itself as the next big leader when it comes to talent and potential for developing companies.”

Where once the region was struck off as immature, in 2024, many should be looking to LatAm, particularly Brazil and Mexico, as leaders in FinTech investments and technology advancement. Growth in LatAm is already outpacing more established regions, particularly in the FinTech sector driven by the need for financial inclusion solutions.

Baber agrees that the attribution of the popularity and growth of the region is due to a combination of its tech-driven workforce and its proximity to the US. Gen Z and Millennial demographics are not only in favour of new FinTech developments for their convenience. Their demographics are also more tech-savvy than previous generations, and hungrier to embrace the future of technology and further careers in IT.”

“Similarly, real-time collaboration with the US is easier due to the same time zones, meaning greater investment towards a more local region in comparison to outsourcing across the globe. Business relations become stronger when there is a greater ability to interact within work hours.

LatAm governments and regulators have proven to be more supportive of FinTech, crypto and new finance developments, as seen previously with El Salvador. FinTech needs an appetite for change and the next big technology to thrive, and thus the region’s alignment with those values has made it particularly powerful for FinTech unicorns. 

This is clear for Brazil, which is leading the pack as a great source of the best in FinTech developments. No doubt, with greater ongoing support from improved education, government initiatives and encouraging digital innovation will the country see even more growth in their FinTech scene for the market to capitalise on.