Historically, Brazil has been the powerhouse in Latin America when it comes to venture capital funding. But in the second quarter of 2025, Mexico emerged as the leader in terms of dollars raised in the region, per Crunchbase data. It’s the first time since the second quarter of 2012 that Mexico startups brought in more venture dollars than their Brazilian counterparts in Latin America, our data indicates.
Mexico-based startups raised $437 million in the second quarter, up 85% year over year and 81% quarter over quarter. Brazil-headquartered startups brought in $350 million, down 23% year over year and a 14% dip quarter over quarter.
The largest raise in Mexico — and Latin America as a whole — was announced on June 30, the last day of the quarter. That was a $170 million Series C round for Mexico City-based fintech startup Klar — believed to be Mexico’s largest digital bank —- that valued the company at $800 million.
In general, a boom in late-stage and growth funding helped buoy the region for the period, Crunchbase data shows. Startups in Latin America raised a combined $961 million across seed- through growth-stage deals in the second quarter, up 16% year over year and 13% compared to the first quarter.
Of that total, $547 million went into late-stage and growth deals, up 102% year over year. That’s nearly exactly double the $273 million in late-stage and growth financings the region saw in the first quarter of this year.
For perspective, we charted out total investment, color-coded by stage, for the past 10 quarters below.
Round counts declined sequentially and year over year across angel, seed and early stages. We expect the Q2 deal counts to rise somewhat over time, however, as seed rounds in particular are commonly reported weeks or months after they close.
Table of contents
Late-stage boom
While Klar’s venture round was the largest financing in Latin America, it was not the only nine-figure raise the region saw in the second quarter.
Kavak, a Mexico City-based startup that operates a pre-owned car marketplace in Latin America, secured $127 million in a growth funding round co-led by SoftBank and General Atlantic.
New Wave, a Rio de Janeiro, Brazil-based company developing “sustainable and low-cost” technologies for the mining-metallurgical sector, raised nearly $120 million in a growth financing led by Orion Resource Partners.
Other large deals included Chilean fintech Toku raising $48 million in a Series A round and Mexican e-commerce aggregator Merama’s $45 million raise.
Investor POV
Funding in Latin America is certainly down compared to 2020-2022. However, there are some investors who remain loyal to the region.
Miguel Armaza, co-founder and general partner at New York-based Gilgamesh Ventures, believes that investors who’ve exited LatAm were often tourists, and not truly committed to the region.
Armaza blames the reduced appetite on LP preferences for investing in the U.S. and the lack of IPO activity in Latin America, something he predicts will improve “notably in the next 12-18 months.” For its part, Gilgamesh is still investing in the region, he said, but acknowledges that it’s seeing “a bit more activity in the U.S.”
The firm backs startups focused exclusively on Brazil or Mexico because, in his words, “these markets have the scale to deliver VC-sized outcomes.”
“However, over the past couple of years, we’ve increasingly invested in a newer category: startups designed from day one to operate regionally or globally,” he told Crunchbase News. “Unsurprisingly, many of these newer ventures are AI-first, and we’ve already backed a number of AI-centric startups in the region.”
Armaza also argues that the investment pace in LatAm is roughly aligned with 2019-2020 thanks mostly to regional investors.
“The pullback of certain international and U.S.-based investors has been partially offset by new local funds stepping up,” he said. “Today, most strong founders in Brazil can raise their seed rounds entirely locally, often within just two to three neighborhoods in São Paulo. This local ecosystem strength is a significant positive.”
Mike Packer, partner at Alexandria, Virginia-based QED Investors, said his firm still sees “incredible opportunity” in the region, especially in Brazil and Mexico, but also in countries like Argentina.
“Because of the liquidity cycle and the general lack of exits in the ecosystem, companies are trying to figure out how to think bigger earlier,” he told Crunchbase News. As such, companies are increasingly learning from other geographies. For example payment companies such as Ebanx and dLocal are expanding to Africa and Asia.
For its part, in the first half of 2025 QED focused on seed and Series A financings but it has also expanded its focus to include more Series B companies.
“The best companies here look really healthy, they’re growing fast, they’re close to profitable, if not already profitable and they’ve proven a level of scale that gives us lots of comfort about execution abilities and market size,” he said.
Nicolas Szekasy, co-founder and managing partner at São Paulo-based Kaszek, said his firm’s investment pace has accelerated in 2025 compared to the previous two years.
“The evolution of the Latin American tech ecosystem over the past 25 years has been extraordinary — from almost nothing to a vibrant, robust environment,” he told Crunchbase News. “Yet, when you look at the data, the region is still massively underpenetrated.”
And, despite Mexico’ s unusually good quarter, Szekasy still believes that Brazil remains Latin America’s largest and most mature ecosystem, and that São Paulo “is arguably Latin America’s tech capital.” However, Kaszek invests across the region — half of its investments are in Brazil, followed by Mexico, then Argentina, Colombia, Chile and the rest of the region.
Szekasy also believes that investors have not necessarily backed off from LatAm.
“Some firms have been consistently active in Latin America for years,” he said. “Others came and left, and new ones are arriving now.”
Still, Szekasy acknowledged that 2021 was “a global VC bubble” with some investors participating during that time indeed being more “tourists.”
Looking ahead, in his view, the resilience of Latin American founders is part of what makes the region so attractive.
“They’ve been building through volatility for decades — navigating recessions, inflation, currency devaluations and regulatory swings,” he said, citing MercadoLibre and Nubank as prime examples.
“Both were born in adversity and are now worth a combined $200 billion in market cap,” he said. “Their opportunity ‘signal’ was far stronger than any surrounding ‘noise.’ ”
Going in earlier
Brian Requarth, general partner at early-stage-focused Latitud, said his firm has maintained its investment pace from recent years, closing 25 deals this year so far.
“What has changed is that we’re going even earlier,” he said. “Some of our investments are at the pre-inception stage, where we back exceptional founders before they’ve even landed on a thesis.”
While Latitud remains sector agnostic, Requarth acknowledges that nearly every investment the firm has made in 2025 “has some AI angle.”
Like Gigalmesh and QED, Latitud has invested heavily in Brazil, but also in companies based in Mexico, Colombia and Argentina. One recent shift in the firm’s strategy is to allocate more capital to Latin American founders who are building companies in the U.S.
“We’re seeing world-class talent from the region moving to San Francisco and launching globally ambitious startups,” Requarth said. “That’s a wave we’re leaning into.”
Overall, he believes “this is a moment of recalibration” in Latin America, “not retreat.”
He added: “For those who are close to founders and understand the dynamics of the region, there’s still an enormous opportunity.”
Methodology
The data contained in this report comes directly from Crunchbase, and is based on reported data. Provisional data reported is as of July 3, 2025.
Note that data lags are most pronounced at the earliest stages of venture activity, with seed funding amounts increasing significantly after the end of a quarter/year.
Please note that all funding values are given in U.S. dollars unless otherwise noted.
Crunchbase converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historic spot price.
Glossary of funding terms
Seed and angel consists of seed, pre-seed and angel rounds. Crunchbase also includes venture rounds of unknown series, equity crowdfunding and convertible notes at $3 million (USD or as-converted USD equivalent) or less.
Early-stage consists of Series A and Series B rounds, as well as other round types. Crunchbase includes venture rounds of unknown series, corporate venture and other rounds above $3 million, and those less than or equal to $15 million.
Late-stage consists of Series C, Series D, Series E and later-lettered venture rounds following the “Series [Letter]” naming convention. Also included are venture rounds of unknown series, corporate venture and other rounds above $15 million. Corporate rounds are only included if a company has raised an equity funding at seed through a venture series funding round.
Technology growth is a private-equity round raised by a company that has previously raised a “venture” round. (So basically, any round from the previously defined stages.)
Illustration: Dom Guzman
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