Uruguay Gets Its First Billionaires With U.S. Fintech IPO

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Wealth in Uruguay has historically been tied to agriculture and meatpacking, but it took a fintech startup to create the country’s first billionaires.

Andres Bzurovski, 43, and Sergio Fogel, 57, joined the ranks of the world’s richest following DLocal Ltd.’s initial public offering in New York. Shares of the payments firm they founded climbed to $32.39 Thursday in the first day of trading -- a 54% increase over the IPO price -- collectively valuing the pair at about $3.69 billion, according to the Bloomberg Billionaires Index.

A representative for the Montevideo-headquartered firm didn’t respond to a request for comment on the founders’ wealth.

DLocal allows companies including Amazon.com Inc., Microsoft Corp. and Spotify Technology SA to handle payments in 29 developing countries where international credit cards are scarce and cash is king. A 2020 investment round led by General Atlantic valued the firm at $1.2 billion, making it Uruguay’s first unicorn. A subsequent round led by Alkeon Capital in April valued it at $5 billion.

Latin America has become a hot bed for financial technology firms. The region is home to Sao Paulo-based Nubank, the world’s biggest standalone digital bank valued at $25 billion, as well as Nasdaq-listed payments fintech StoneCo, worth nearly $20 billion. They’ve thrived by offering cheaper, less-bureaucratic alternatives to traditional financial products, reaching millions of unbanked consumers.

‘A Shock’

Fogel, who has invested in more than 15 tech startups, and Bzurovski were part of the management team that created DLocal in 2016 using their own money. Reaching unicorn status “was a shock,” Fogel said at an event in Punta del Este in November. Private equity backing “is a kind of passport that opened doors for us” at banks, clients and suppliers, he said.

DLocal earns revenue from the fees it charges merchants for cross-border and local payment transactions. Sales and profit almost doubled last year to $104.1 million and $28.2 million, respectively. The company expanded into Africa and Asia in recent years, though Latin America still accounted for about 89% of its first-quarter revenue.

Bzurovski and Fogel sold at least 5,623,500 shares each, according to the prospectus. They still each own about 18% of the company.

©2021 Bloomberg L.P.

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