Diego Noriega, Managing Partner of Newtopia VC, visited San Francisco during the first week of June 2023 to build bridges between Silicon Valley and Latin America.
During his visit, he connected with VCs and shared opportunities and collaborations.
The events he attended were:
State of VC Fundraising – SF Tech Week Panel
Hosted by: Carta, Deel, Vauban and AWS Startups
Diego share his Takeaways:
- The decline in fundraising speed has been much greater than the decreases in valuations at the early stage.
- In Seed rounds, valuations have only decreased by 9% since Q1 2022, while the volume of rounds has decreased by almost 50%. According to Carta, this indicates that investors are being more cautious and selective when investing their capital, perhaps as a mandate from their limited partners (LPs).
- he time from Seed to Series A has increased by 20%, reaching almost 30 months. The same trend is observed in the transition from Series A to Series B.
- There has been an increase in Downrounds (1 out of every 5 investments). This indicates that investors are being more demanding when evaluating the growth potential and profitability of startups.
- VCs’ Due Diligence processes are also taking longer compared to previous years. Bridge Rounds: There is a significant increase in «bridge rounds,» where valuations remain similar. This may indicate a trend towards continuity of investments in established companies rather than betting on new ventures.
- AI is experiencing higher valuations. New hype or a lasting trend?
These data are about the US market.
We co-hosted an Asado in Palo Alto with 45 investors and founders.
It was an amazing day, full of laughter, deep conversations, and hugs.
«During the session, I asked a question: What can we do to get US investors to invest more in our region? How do we speed up these initiatives? Who are the most important players?
There were numerous proposed initiatives, but they all pointed to the need for a new generation of unicorns to emerge from the region.
This is the work we have to do in Latam. They won’t just come out of nowhere, but thanks to having teams with big visions.
We have the market, the challenges, the talent, and more. Sure, we may need more capital, but first, let’s have startups that generate amazing returns for the investors.»
#GovTechFuture Happy Hour!
Diego shared his expertise and had conversations with Paola Santana, Founder of Glass, during a spectacular San Francisco sunset for industry leaders, innovators, and GovTech enthusiasts.
- We discussed the importance of work, attitude, and professionalism for Latinos aiming to succeed in the US market as both customers and investors.
- It is important for us to work hard to raise our level of preparedness to be competitive in this highly competitive market.
- We delved into the key characteristics of an investable entrepreneur, whether through Newtopia VC or other colleagues in Latam and the Bay Area.
- Diego emphasized the significance of extensive communication with customers, giving them time and space.
- He shared how he fell in love with his own solution, and it was only when we started conversing with customers that we received signals of Product-Market Fit (PMF). Every entrepreneur needs to be obsessed with PMF.
- Co-designing solutions with close customer relationships is perhaps the best tool, but there’s still much to be done in this area.
- Diego also spoke with other investors. Despite some concerns about the current context, checks are still being signed, especially at the early stage.
- Many Latin entrepreneurs are building interesting things, and it’s much more feasible for them to do so from the US to serve the world.
- Your attitude, decision-making, and drive are crucial for making things happen, and investors appreciate it when these qualities are complemented by excellent execution capabilities.