Digital Financial Services Firm Konfio Acquires $125M via Series E Round, including $20M from VEF

Konfio has announced a $125 million Series E round with VEF investing an additional $20 million in the company’s operations.

The team at VEF announced on Tuesday (June 22, 2021) a $20 million follow-on investment into Konfio, which is one of Mexico’s leading SME-focused Fintech firms. VEF took part in the broader Series E round of $125 million, which was led by new investor Lightrock, along with contributions from existing investors Softbank, Kaszek Ventures, QED Investors, IFC and new investor Tarsadia Capital.

VEF’s participation in the round is “not expected to have a material impact on VEF’s latest reported NAV per 1Q21,” according to the announcement.

The update also mentioned that Konfío is VEF’s second-largest holding and “represents 15% of VEF’s NAV as at 1Q21 reporting.” VEF led Konfio’s Series C investment round back in 2018 and followed on in their Series D and now Series E round.

Operating out of Mexico, Konfio is a technology-leading firm that’s focused on “boosting the growth and productivity of small and medium sized businesses, through three strategic core offerings: credit, payments, and business management tools,” the announcement noted.

As mentioned in the update:

“Founded in 2013, Konfío offers access to agile credit with an immediate decision process based on data and artificial intelligence, business-to-business payment management and financing platform, and a cloud-based system for operational, accounting, and financial business management available to both companies and accountants who provide services to businesses.”

The financing round will be channeled towards expanding the current scope of Konfío’s core offering while allowing the Fintech to be “on the outlook for acquisition opportunities that, integrated with Konfío’s platform, expand the value of the ecosystem of products it delivers to small and medium-sized businesses.”

VEF CEO, Dave Nangle stated:

“Konfío is VEF’s second largest holding and one of the breakout names within our portfolio. What really excites us about Konfio at this juncture is the continued rapid growth of their credit offering that is being increasingly complimented by the Group’s payments and ERP offering, realising a much more balanced and varied, fast growth revenue stream. This funding round is yet another milestone for both Konfío and VEF, and puts both companies in a very strong position to create value through 2021 and beyond. At VEF when we find an asset we love, we always back it harder – we view portfolio concentration as goal, not a risk, and Konfío is an excellent case in point.”

Konfio CEO, David Arana remarked:

“At Konfío, we see technology as a great enabler to level a playing field that for a long time has been uneven, providing growing companies opportunities and conditions to expand and compete successfully with larger companies – this is our purpose. As an example, in a challenging year and thanks to proprietary technological developments, at Konfío we managed to increase our loan book by 20% in 2020. Konfío’s doors have remained and will remain open to customers with no history with us, in times when credit from traditional banks has fallen in one year by more than 10% in real terms. Today, our product offering is not just credit, and stay tuned because we will continue to expand it.”

As noted in the update, VEF Ltd. is an investment firms, whose SDRs are currently listed in Sweden. The company regularly invests in growth-stage private Fintechs. The company explains that it consistently acquires minority stakes and “are active investors with board representation in each of our portfolio companies, always looking to back the best entrepreneurs in each market.”

VEF focuses on “scale emerging markets and invest across all areas of financial services inclusive of payments, credit, mobile money and wealth advisors.” VEF trades in Sweden on Nasdaq First North Growth Market under the ticker VEFL SDB.

VEF’s Certified Adviser on Nasdaq First North Growth Market is Pareto Securities AB.

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