Marathon Ventures injects more capital into Colombia's startup ecosystem
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Loading... - Helena Foster
- 03 Feb 2022
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Brazil and Mexico are most known as Latin America’s hot startup ecosystems, but other countries, like Colombia, are gaining visibility and interest from investors.
One of the investors seeing promise in this country is Marathon Ventures, which closed its first fund of $26 million, touted as one of the country’s largest funds to date.
Alejandro Echavarria and Leon Papu, both managing partners, co-founded the venture capital firm in 2020 with Pablo Navarro, operating partner, to focus on early-stage, business-to-business startups in emerging markets. Their plan is to fund about 20 companies in fintech, SaaS and marketplaces.
Echavarria has a background in finance and construction while Navarro was previously with Amazon. Echavarria says Latin America is traditionally viewed differently by investors.
“It’s a different paradigm,” he added. “Only a few years ago, you would have to be introduced to 100 funds before you could get a term sheet.”
As angel investors, Echavarria and Papu would often be approached by seed founders seeking introductions to strategics and key hires. This was around 2016, Echavarria said, when there was a recognizable funding gap at the seed stage. After that, they began seeing the first cohorts of startup alumni founding their own businesses.
“We thought that would change everything, and with their history, would help global investors warm up to the region,” he added.
Then the global pandemic hit, and the trio thought there needed to be more concentrated seed investors with the bandwidth and time to support the founders.
They started Marathon initially as a company builder in 2020, which is how they ended up investing in Tul, ​​a B2B e-commerce marketplace that optimizes the construction-material supply chain for hardware stores across Latin America. In January, Tul announced a $181 million Series B round at an $800 million valuation.
They then pivoted to be a fund, though they continued to leverage their previous knowledge and network. Echavarria says Marathon invests in talent at the earliest stages, even before there is a pitch deck.
“One of the biggest pain points, where Pablo is actually an expert, is creating a top-of-the-line team and developing markets,” he said. “In fact, 50% of our team is focused on helping scale.”
In addition to Tul, the fund has invested in eight companies and is already seeing an approximate two-time return over the total fund size to date. Marathon’s portfolio includes companies like Estoca, Meru, Neivor, Sprout, Sumer, Welbe and Wonder Brands. Read More…
