Following a brief spike in dollars last quarter, funding and deals to companies in Latin America continue to contract in the first quarter of 2023.
Latin America venture funding stopped at $0.6B in Q1’23, marking a 54% drop, and falling below the $1B mark for the first time since Q1’20.
Deals also dropped by 28% QoQ, falling from 218 to 157. 
Other Q1’23 highlights across the LatAm venture ecosystem include:
- While Brazil saw its venture deals and dollars stabilize in Q4’22, the fundraising environment continued to slow down in 2023. Startups here raised $0.2B across 71 deals, marking a 67% drop in funding, and a 35% drop in deal activity compared to the previous quarter.
- Mexico-based startups raised $72M in Q1’23, down 44% from the previous quarter. This was the third quarter to see a sharp drop in funding — Q4’22 saw a 49% drop, following a 59% decline in Q3’22.
- The Latin American IPO market remained frozen in Q1’23, with zero IPOs. That’s down from only 4 in 2022, and from 18, the peak, in 2021.
- Latin America saw 98 M&A deals last quarter, up 13% QoQ, and the first increase in M&A activity since 2021. As the venture market (and valuations) continue to cool off in the region, more startups are predicted to choose the M&A route.
CB Insights clients can see all the latest investment data for Latin America and the Caribbean by signing in and downloading the full report using the sidebar. Dig into investment trends from around the world in our global State of Venture Q1’23 Report.
