SoftBank Joins Valor Capital in Hunt for Latin American Startups

(Bloomberg) -- SoftBank Group Corp. has teamed up with a venture capital firm to find new investments in Latin America.

The Japanese technology giant plans to invest in the region alongside Valor Capital Group. Last week, SoftBank funded gym-membership startup Gympass, a Valor-backed firm. More deals are coming.

"Our main goal is to create value together and impact by investing in the best-in-class entrepreneurs and companies in Brazil and Latin America," Scott Sobel, managing partner and co-founder at Valor Capital said in an interview at the firm’s office in Sao Paulo. "We’ll also be helping SoftBank-backed companies that are outside Brazil enter the Brazilian markets."

Valor Capital has $300 million invested in 37 Brazilian companies and U.S. firms looking to grow in the nation. Among its better-known bets are payments firm StoneCo Ltd., which went public last year, and CargoX Transportes, an Uber-like offering for truckers. Other portfolio companies include location data company In Loco, personal finance firm Guiabolso Financias Pessoais SA and education helper Passei Direto SA.

In March, SoftBank launched a $5 billion technology fund focused on Latin America, headed by Chief Operating Officer Marcelo Claure.

Valor Capital was founded in 2011 by Sobel and his father Clifford Sobel, a former U.S. ambassador to Brazil. It has offices in Sao Paulo, New York and Silicon Valley.

"As our companies mature, SoftBank will be a great kind of follow-on partner to co-invest and direct invest in our companies," Scott Sobel said.

Global venture investors put $2.22 billion into startups in Latin America last year, more than double 2017’s total, according to PitchBook data. This year, investors are on track to top the 2018 number.

"We’ve seen the market in Brazil grow and mature dramatically over the last five years," said Sobel. "But we still think there’s a lot more room for institutional capital to come in."

--With assistance from Cristiane Lucchesi and Felipe Marques.

To contact the reporter on this story: Vinícius Andrade in São Paulo at vandrade3@bloomberg.net

To contact the editors responsible for this story: Brad Olesen at bolesen3@bloomberg.net, Andrew Pollack

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