Credix, a Brazilian Fintech, has raised $11.25 million in Series A funding, according to a corporate statement. The Credix funding round was led by Motive Partners’ Early Stage fund and ParaFi Capital. Other investors include Valor Capital Group, Victory Park Capital, MGG Investment Group, Circle Ventures, Abra, Fuse Capital, Claure Group and private investor Ricardo Villela Marino (Chairman of Itau LatAm). In late 2021, Credix raised $2.5 million in Seed funding.
Credix said the new funding will boost advancements in the company’s technology, while investing in talent, and seeking strategic opportunities with institutional investors and borrowers.
Credix is a blockchain-based platform that aims to connect institutional investors globally with loan originators in emerging markets. According to the company, it currently has over 25 funds actively using the platform with relationships with Brazilian companies such as A55, Provi, Tecredi, Descontanet, Divibank and Adiante. These loan originators have received over $20 million in financing through the platform.
By the end of 2022, Credix expects to have expanded beyond Brazil, launching in Mexico and Colombia, and connecting with more institutional investors and loan originators, representing more than $ 100 million in assets under management.
Thomas Bohner, founder and CEO of Credix, said the Series A is truly strategic having included the “best in class” from the world of crypto and traditional finance:
“We are bringing onboard partners with deep expertise in emerging markets, private credit, and organized finance in order to build a scalable financial technology infrastructure. Furthermore, we want to scale our markets, from fintechs to themed markets, to syndicated markets and geographical markets. This investment will allow us to stay ahead of the competition and keep innovation on tech and legal aspects.”
Michael Nicklas, Managing Partner at Valor Capital Group, noted they have been investing in the Fintech sector for more than ten years and they understand the inefficiencies intrinsic in traditional finance:
“Blockchain and especially DeFi have the potential to create a more scalable, efficient, and cheaper financial markets infrastructure.,” said Nicklas. “We strongly believe that Credix is the best-positioned player to capture this opportunity”, said “With this investment, Credix will be able to accelerate its pipeline of fintech clients and institutional investors, continuing to build a next-generation global infrastructure. Bridging DeFi with traditional markets is a key component of our crypto thesis, and we are happy to be a key partner for Credix in this journey.”
Credix offers a service that connects institutional investors worldwide with Fintechs in emerging markets, such as Latin America. This is said to include both multi-billion-dollar funds and high-net-worth individuals who previously had no access to this type of investment opportunity. Users may invest actively or passively. In the first case, investors may analyze and underwrite deals one by one, for which they can anticipate a return of more than 20% per year, according to Credix. Passive investors invest in the liquidity pool, a combination of several deals with lower risk, but also lower returns – said to be about 12% per year.
Credix notes that all deals on the marketplace are screened “extensively by their team. Fintechs using the platform receive stablecoins in crypto wallets and then convert them into the local currency before disbursing loans to its end borrowers.
Thomas Harris, Vice President at Motive Partners’ Early Stage fund, said they see significant potential in developing the ecosystem to solve real world challenges:
“The Credix platform is an early mover in this ambition, providing underserved Fintech lenders with faster, more flexible access to global capital and giving global investors diversified exposure to attractive credit opportunities that are otherwise hard to efficiently access and underwrite. We have been impressed by the ability and ambition of the Credix team, and are excited to bring the strength of the Motive Partners platform to accelerate the team’s already impressive growth and help to build the first truly institutional-grade platform in this space.”
Ben Forman, Managing Partner at ParaFi Capital, commented on Credix’s goal of brining DeFi to instititional investors with a regulatory compliant fixed income market built on blockchain:
“We’ve been impressed with the team’s execution and deep understanding of institutional credit markets. We believe Credix is rebuilding an antiquated system through blockchain technology and solving a real-world problem at a critical time for the industry.”