Latin America is experiencing a surge in software-as-a-service (SaaS) companies, with the industry growing rapidly in recent years.
According to a report by Latitud, SaaS is a rapidly growing market, with the top 100 global SaaS companies worth close to 20% of all the world’s unicorns combined.
The report also highlights that Latin America is experiencing its best moment ever in SaaS, with Brazil creating as many unicorn startups in 2022 as it had in the past 20 years.
Growth of SaaS Startups and Companies in Latam Statistics
The SaaS in Latam industry has seen a 30% growth in 2020, with an annual growth of 8% predicted between 2020 and 2026, according to Newtopia.vc.
The pandemic accelerated the growth of SaaS in Latin America, with segments such as human resources management, cybersecurity, and e-commerce enabling software benefiting the most.
Factors contributing to growth
One of the key factors contributing to the growth of SaaS in Latin America is the increasing availability of high-quality talent and resources.
The region has a large pool of tech talent, which is being utilized by both local and international companies. Additionally, favorable government policies and regulations have also contributed to the growth of the SaaS industry in Latin America.
Comparison of Latin America’s SaaS industry to the rest of the world
Compared to the rest of the world, Latin America’s SaaS industry is still in its infancy, but it is growing rapidly. According to a hub on Crunchbase, as of 2021, there are more than 4,000 SaaS companies in Latin America.
This is still a small number compared to the number of SaaS companies in North America and Europe, but it is growing rapidly.
The region’s SaaS industry is also unique in that it is developing localized solutions to meet the specific needs of the SaaS Latin American market. According to the report by Latitud, Latin American SaaS startups are predicted to evolve drastically in a short period, especially those in segments with less global competition and more need for localized solutions.
Recommended Lecture: The State of the SaaS Market in Argentina 2023
SaaS Startups in Latin America
Software-as-a-Service (SaaS) startups are emerging as a key driver of economic growth in Latin America. These startups are creating jobs, attracting investment, and developing innovative solutions that are transforming the region’s economy.
SaaS startups are companies that provide cloud-based software solutions to businesses and consumers. These solutions are typically sold on a subscription basis, which provides a steady stream of recurring revenue for the company.
In Latin America, SaaS startups are becoming increasingly important as the region’s economy continues to grow. These companies are developing solutions for a wide range of industries, including finance, healthcare, e-commerce, and logistics.
Investment in Latin American SaaS Startups and Companies
SaaS investment is a form of venture capital funding that is used to finance the development and growth of SaaS startups and companies.
This type of investment is typically provided by specialized investors who have experience in the industry and understand the unique challenges and opportunities that it presents.
The growth of SaaS investment in Latin America has been driven by a number of factors. These include the region’s large and growing pool of tech talent, favorable government policies and regulations, and the increasing availability of capital from both local and international investors.
Funding for Latin American SaaS startups and companies
There are a variety of funding sources available for Latin American SaaS startups and companies. These include:
- Venture capital: Venture capital firms provide funding to early-stage startups that show promise for growth and profitability.
- Angel investors: Angel investors are wealthy individuals who provide funding to startups in exchange for equity in the company.
- Accelerators and incubators: Accelerators and incubators provide funding and support to startups in exchange for equity in the company.
Examples of Funded Latin American Saas Startups and Companies
There are many SaaS startups in Latin America that have received funding from investors. Some examples include:
- Nuvemshop: Based in Argentina, Nuvemshop provides a platform for building e-commerce websites. The company has raised over $130 million in funding, according to Crunchbase.
- Loft: Based in Brazil, Loft provides a platform for buying and selling real estate. The company has raised over $665 million in funding, according to Crunchbase.
- Kavak: Based in Mexico, Kavak provides a platform for buying and selling used cars online. It offers a convenient and transparent process for individuals to purchase pre-owned vehicles directly from the platform, eliminating the traditional hassle of dealing with dealerships or classified ads.Kavak also provides services such as financing, warranty options, and vehicle inspections to ensure a seamless and trustworthy buying experience for its customers.With its innovative approach, Kavak has gained significant popularity in the Mexican market and has expanded its operations to other countries in Latin America, becoming a prominent player in the region’s automotive industry.
SaaS e-commerce – Pre Series A
Alephee helps companies with thousands of products, such as General Motors and Bosch, to increase their revenue in Latam, by listing their inventory on large e-commerce sites like MercadoLibre and Amazon and improve their B2B supply strategies.
SaaS Proptech – Seed
Properix empowers neighbors and gives scalability to Property Managers in one solution. With the vision of incorporating embedded finance and insurance into the homes of millions of latin american households.
SaaS HR Tech – Seed
Lara AI is an AI-enabled conversational interface that has frequent conversations with employees, gathers insightful information to improve their experiences in real-time, and builds a unique organizational culture. Additionally, we make people’s time more efficient by automatizing time-consuming tasks such as answering FAQs, managing tickets and requirements, and sending personalized communication to employees at key moments.
SaaS Cyber Security infrastructure – Seed
illow helps companies to automate data deletion. Users request the deletion of their personal data and illow ensure the execution and control of the process. Grupo Nexpe ($NEXP3) is already our client and we are closing POC with Natura, WeWork and two big banks.
We are on a market that is projected to grow from $2.36 billion in 2022 to $25.85 billion by 2029, at a CAGR of 40.8%. We aim to be the Zapier of privacy building the biggest API library to delete data from third party apps. Founders:
SaaS HealthTech – Seed
Revai is a collaborative platform for doctors, patients and the healthcare industry. An ecosystem where all of them could enhance the generation and classification of the data, making anonymized data available for open research, while prompting citizens to become the ultimate controllers of their health data.
SaaS translation AI – Seed
«GetGloby is an AI-powered platform that instantly translates Ads Campaigns into 100+ languages with high performing results thanks to JAGA, our proprietary translation technology, which is capable of understanding the nuances of every market to adapt the original message.
Founded by former Googlers, Diego Antista & Juan Fusoni, GetGloby empowers brands to expand into new markets and improve their Ads performance in current ones, while significantly reducing their costs.»
SaaS AdTech for e-commerce – Seed
Aument is a SaaS marketing platform that helps small ecomm brands get new sales through multiple communication channels, easily.
Just 10 months after launch, +420 brands are using Aument to convert more visitors into customers, grew 12% WoW in September and we onboarded our first 52 paying customers.
We expect to hit 1000 brands by December 2022.
SaaS HR Tech / Fintech – Pre-seed
Maslow is an HR-Tech company that is rewriting the story of compensation and benefits, by giving employees the flexibility to choose how they want to be compensated, getting a better value proposition, and making companies’ investment in talent more efficient.
SaaS onboarding for Fintech – Pre-seed
Zenpli is an infrastructure focused SaaS working on putting a stop to the KYC and fraud challenge in LatAm. Through 1-single integration, LatAm fintechs and other digital innovators seamlessly onboard more good customers by accessing best-in-class data across all domains and running accurate end-to-end identity decisions supported by advanced models that are hard to spoof.
We’re rolling our product with Mastercard in Mexico in Q4 2022 with the potential to generate ~500k in ARR over the next 12-months. We’re backed by The Fintech Fund, Ralicap, Amador, Newtopia and world-class angels and advisors from C-level and VPs at Socure, EPAM, Konfío, R2 and Bureau.id.
SaaS AI adtech Beauty – Pre-seed
We transform how brands and teams interact with data. AI-powered social and visual analytics that drive industry understanding and business success. Market: Social media analytics: a fast-growing (+35% CAGR) & fragmented market estimated to reach $15 bn in value by 2025. Business Model: SAAS Dashboard Access + Customer Success Manager.
Aimo turns conversations into an effective sales channel, helping ecommerce brands sell more on WhatsApp. We help retailers use data to make the most out of their conversations, engaging customers and increasing their conversion rates.
We are building a platform that integrates a CRM and automations with WhatsApp and ecommerce platforms, while keeping track of all the steps on a client’s digital journey. Aimo’s main goal is to digitize the assisted shopping experience.
To achieve this, we are building a saas platform that allows you to: – Automate conversational sales – Create marketing campaigns – Unify all your contacts and leads into one single CRM – Keep track of your WhatsApp chats.
SaaS Wellness / HealthTech – Pre-seed
Yerbo collects data from 2-min weekly surveys and translates mental well-being results into insights that help companies understand their team’s burnout risk, the causes and track evolution over time.
Menta Tickets – Web3
Is an Infrastructure blockchain solution for ticketing companies. With their API’s, companies will add a blockchain layer to their operations, in 30 minutes (not 30 months).
Where every ticket is transformed into an NFT, creating traceable and controllable NFtickets and allowing them to receive royalties from resales. Revenue Q4: $74k, with 5 pilot agreements for 2023 generating an expected revenue of 50k per month once we reach that product deliveries.
Bonder helps B2B companies improve their new clients’ onboarding process. By creating an onboarding playbook and customer-facing onboarding pages for every new customer, Bonder’s clients can improve their time-to-value, reduce churn and create unbeatable first impressions.
Challenges and Opportunities for Latin American SaaS Startups and Companies
While the SaaS industry in Latin America is growing rapidly, there are still many challenges that SaaS startups and companies in the region face. At the same time, there are also many opportunities for growth and success.
Challenges facing Latin American SaaS startups and companies
Some of the key challenges facing Latin American SaaS startups and companies include:
- Access to capital: While investment in the SaaS industry in Latin America is growing, there is still a need for more capital to support the growth and development of startups in the region.
- Limited market size: The Latin American market is still relatively small compared to other regions of the world, which can make it challenging for startups to achieve scale.
- Infrastructure challenges: The region’s infrastructure is still developing, which can make it difficult for SaaS startups and companies to provide reliable and efficient services.
- Talent retention: There is a shortage of tech talent in the region, which can make it challenging for startups to attract and retain top talent.
Opportunities for Latin American SaaS startups and companies
Despite the challenges, there are also many opportunities for growth and success for SaaS startups and companies in Latin America. Some of these opportunities include:
- Localization: Latin American SaaS startups and companies have the opportunity to develop localized solutions that meet the unique needs of the region’s businesses and consumers.
- Increasing demand for digital solutions: The pandemic has created a greater need for digital solutions, which has led to increased demand for SaaS startups and companies.
- Favorable government policies and regulations: Many governments in the region are implementing policies and regulations that are supportive of the growth and development of the SaaS industry.
- Growing investment: Investment in the SaaS industry in Latin America is growing rapidly, which provides startups and companies with access to the capital they need to grow and expand.
Best practices for Latin American SaaS startups and companies
To succeed in the competitive SaaS industry in Latin America, startups and companies should consider implementing best practices such as:
- Building a strong team: Attracting and retaining top talent is essential for the success of any SaaS startup or company.
- Focusing on product-market fit: Developing products that meet the needs of the local market is essential for achieving success in the region.
- Embracing innovation: The SaaS industry is constantly evolving, and startups and companies that are able to innovate and adapt quickly will be more likely to succeed.
- Developing a strong brand: Building a strong brand is essential for attracting customers and investors in the competitive SaaS industry.
Future of Latin American SaaS Startups and Companies
The future of Latin American SaaS startups and companies looks bright. As the region’s economy continues to grow, the demand for digital solutions is expected to increase, creating new opportunities for startups and companies in the SaaS industry.
Predicted growth of the SaaS industry in Latin America
According to the Latitud, Latin American SaaS startups are predicted to evolve drastically in a short period, especially those in segments with less global competition and more need for localized solutions.
The report predicts that the SaaS industry in Latin America will continue to grow rapidly in the coming years, driven by increasing demand for digital solutions and favorable government policies and regulations.
Potential for Latin America to become a global SaaS hub
Latin America has the potential to become a major player in the global SaaS industry. The region’s large and growing pool of tech talent, favorable government policies and regulations, and increasing availability of capital from both local and international investors make it an attractive destination for SaaS startups and companies.
Focus on innovation and localization
To succeed in the competitive SaaS industry in Latin America, startups and companies will need to focus on innovation and localization. Developing innovative solutions that meet the unique needs of the local market will be essential for achieving success in the region.
Continued investment in the SaaS industry
Investment in the SaaS industry in Latin America is expected to continue to grow in the coming years. As more capital becomes available, startups and companies will have the resources they need to develop and grow their businesses.
Collaboration and partnerships
As the SaaS industry in Latin America continues to grow, collaboration and partnerships between startups and companies will become increasingly important. By working together, startups and companies can share resources, knowledge, and expertise to achieve their goals and drive growth in the industry.
Latam Saas Startups and Companies Questions & Answers
Who are some successful Latin American SaaS startups and companies?
Several successful SaaS companies in Latin America include Nubank, RD Station, and MercadoLibre.
What challenges do Latin American SaaS startups and companies face?
Access to capital, limited market size, infrastructure challenges, and talent retention are key challenges.
How is the Latin American SaaS industry expected to grow in the future?
The industry is predicted to continue growing rapidly, driven by increasing demand for digital solutions and favorable government policies.
Who is investing in Latin American SaaS startups and companies?
Both local and international investors are investing in the Latin American SaaS industry.
What opportunities are there for Latin American SaaS startups and companies?
Opportunities include localization, increasing demand for digital solutions, and favorable government policies and regulations.
How can Latin American SaaS startups and companies succeed in the industry?
By focusing on innovation, localization, building a strong team, and developing a strong brand.