Who is really funding Brazil's fintechs?

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I have a confession: I am completely seduced by the glamorous side of venture capital.

Give me the blockbuster acquisition, the nine-figure funding round, the valuation that somehow doubles in a matter of months - and the eye-watering returns accruing to the Silicon Valley firms that placed the right bet early. One can only imagine the return a16z made on the seed investment it led in OpenRouter in early 2025. Or Kevin Durant on his angel bet on Hugging Face.

But that is not the real world. Not even a drop of it. The real world is FIDCs in Brazil.

A FIDC - Fundo de Investimento em Direitos Creditórios - is a Brazilian investment fund that raises money to buy receivables: the payments owed on everything from consumer loans and credit-card purchases to school tuition, solar panels and corporate invoices.

And remarkably, this deeply unglamorous instrument - or rather, the broader category of debt, FIDCs and structured credit it belongs to - has so far been the principal source of financing for Latin American technology in 2026.

In the first seven months of the year, we logged US$3.27 billion in disclosed debt, FIDC and structured-credit facilities, against US$2.85 billion in venture equity.

That is US$ 1.15 of credit for every US$1 of equity

The numbers are kind of insane. CloudWalk raised US$1.1 billion through a single FIDC in April -65% more than every Brazilian startup combined raised in equity over seven months. Then, just last week, Ume raised another ~US$90 million through FIDCs backed by Itaú, Bradesco and XP.

And then there is Mercado Crédito, the enormous credit business Mercado Libre has learned to fund through an entire stack of FIDCs. Its loan portfolio now exceeds US$16 billion - up 75% in a year - making it one of Latin America’s largest technology-enabled lenders, not some “nice to have” financial product attached to the marketplace.

I would go as far as to argue that FIDCs are the best thing that ever happened to Brazilian fintechs.

They are a huge part of the reason these companies can grow so big without accepting the hefty dilution that comes with raising equity capital - and that many of their counterparts elsewhere in Latin America still have to swallow.

Because lending fintechs have two very different things to finance.

First, the company itself: the technology, licenses, underwriting models, distribution and team.

And then the loans.

That second part gets expensive very quickly. If you use venture capital to fund the loan book, every new billion reais in credit requires another enormous equity round - and another piece of the company handed to investors.

FIDCs changed that.

Instead of selling more equity every time it wants to lend more money, the fintech sells the resulting receivables to a FIDC. Institutional investors supply most of the capital, while the fintech typically keeps the riskier junior piece and takes the first loss if the loans go bad.

And if the loans perform, the company can come back with a larger FIDC, negotiate better terms and borrow more cheaply. No new equity round. No new valuation. No additional dilution.

CloudWalk is exactly what this looks like at scale. Investors funded the company that built InfinitePay. But when CloudWalk needed US$1.1 billion to finance the receivables that company was producing, it did not raise another mega-round.

It went to Brazil’s credit market.

For founders, the implications are kind of enormous.

The next equity round is no longer necessarily the most important funding milestone for a lending fintech. The real graduation is reaching the point where institutional investors are willing to finance the loans - and then returning a year later to find them willing to finance more of them,

for longer and at a lower price.

That changes how these companies should be built.

The funding strategy cannot be something the CFO figures out once the loan book gets big. From the first loan, the data, contracts, underwriting and collection infrastructure need to be good enough to turn those receivables into an asset someone else will buy.

The institutions providing that capital need to see exactly how each cohort performs. They need to understand who received the loans, how quickly they repay, where defaults appear and how much protection exists when things go wrong. The cleaner and more predictable that history becomes, the cheaper the next pool of capital can be.

It also changes what “fundable” means.

A great founder can persuade a venture investor to believe a story. A FIDC investor needs to believe the loans will repay.

And that is a very different kind of discipline. Growth is no longer rewarded simply because it is fast. It is rewarded when the credit produced by that

growth performs well enough for someone else to keep financing it.

And mind you - growth investors LOVE FIDCs in Brazil.

Why wouldn't they?

They get to own the equity in the technology, underwriting and distribution engine without having to keep financing every loan that engine produces. The FIDC brings in credit investors to fund the loan book, while the fintech keeps growing without returning to its shareholders for another massively dilutive equity round.

For existing investors, that means their ownership remains intact while the company becomes larger. Expensive equity can be reserved for product, talent and expansion instead of sitting inside receivables waiting to be repaid.

The FIDC also provides a kind of outside validation. Every time institutional investors agree to finance another pool of loans, they are effectively saying that the underwriting works. And when they return willing to provide more capital, for longer and at a lower price, that signal becomes even stronger.

Brazil is magical like that - give it an impossible credit market and it builds a FIDC.

PicPay - delivered a breakout quarter as it continues its transformation from a wallet into a profitable, diversified financial institution.

Q2 net revenue reached R$4.1B, up 67% YoY, while adjusted net income increased 135% to R$283M and annualized ROE reached 20.2%. PicPay now has 70.4M customers, processed R$167.6B in quarterly payment volume and grew revenue per active customer by 52%. Revenue from secured and partially secured credit increased 158%, while supply-chain-finance originations reached R$1.05B. The company also acquired Kev Seguros and launched integrations with the OpenAI and Claude ecosystems.

→ Picpay is no longer merely a wallet. It is becoming a highly profitable, increasingly diversified financial institution.

Solfácil - is expanding beyond solar financing into batteries and energy trading.

The Brazilian company generates approximately R$2B in annual revenue and has now launched a battery-as-a-service product while preparing to enter Brazil’s free energy market. Solfácil works with around 10,000 solar installers, has enabled more than three gigawatts of distributed solar capacity and

says it is profitable. Equipment distribution now represents roughly half of revenue. Remarkably, the company has historically raised approximately US$180M in equity - but more than R$10B in debt.

→ Solfácil started as the bank of solar energy. Now it wants to become a much broader energy company.

Primero - raised a US$12M seed round to bring enterprise AI

to Latin America.

The Mexican startup’s round was co-led by Kaszek and General Catalyst, with participation from Definition, Conviction and 8VC. Primero is building Primia, a platform that connects to companies’ existing systems and deploys AI agents across their operations. Early customers include Smart Fit, Terpel, Verde Valle and Kimberly-Clark México, as well as Mexico City’s economic-development

agency.

→ Latin America’s biggest AI opportunity is probably making AI work inside the region’s largest companies.

Nubank - crossed US$1B in quarterly profit for the first time,

sending its shares up roughly 11%.

Q2 net income reached US$1.1B, up 49% YoY, while revenue grew 39% to nearly US$5.9B and ROE reached 33%. Nubank now serves 139M customers and has built a US$39.4B credit portfolio. The results pushed its market capitalization back above US$73B - but the stock remains approximately 20%

below its 52-week high as investors continue to watch credit quality closely.

→ Nubank’s profits have reached an extraordinary new scale. Its valuation has not quite caught up.

SaaSholic - closed a US$30M third fund to back Latin America’s next generation of AI-native software companies.

Congratulations to our friends William Cordeiro and Gustavo

Souza. Great job, guys!

The new fund is three times larger than its predecessor and plans to invest in approximately 15 companies over four years, writing initial checks of US$1M-US$1.5M. Spectra anchored the vehicle with US$7M - SaaSholic’s first institutional LP - with Evertec and the founders of Omie, Neon, Hotmart and

Sympla also investing. Around 30%-40% of the capital may go toward companies exporting knowledge and business models developed in Latin America into markets such as the United States.

→ Latin America's venture spent years importing Silicon Valley’s ideas. Saasholic is betting that some of the best ideas are now ready to travel in the opposite direction.

Jusbrasil - acquired MinutaIA, a bootstrapped legal-AI startup founded in February 2025 that has already reached R$100M in ARR.

The full acquisition is Jusbrasil’s second M&A deal as the company targets R$1B in revenue this year.

MinutaIA uses generative AI to help legal professionals analyze cases and produce drafts, giving Jusbrasil another way to turn its enormous legal-data platform into actual workflow software.

→ From zero to R$100M in ARR - and an exit - in roughly 18 months. AI timelines are getting kind of ridiculous.

Listen - Travis Kalanick on David Senra.

This one is wild. Kalanick breaks down Uber’s war with Didi in China, where the company was burning tens of millions of dollars a month and, at one point, its ten largest cities were all Chinese. Come for one of the most insane expansion stories in startup history; stay for Kalanick’s very particular philosophy on leadership, pain and building an organization capable of solving

increasingly impossible problems. He also has some things to say about Bill Gurley and Benchmark. The beef, apparently, remains very much alive.

Read - Joshua Kushner on maintaining investment discipline

during the AI boom.

A refreshingly sober take from someone making an astonishing amount of money from AI. Thrive manages US$60B, concentrates roughly 90% of each fund in its 15 largest investments and has generated a 33% net IRR. And yet Kushner’s message to Silicon Valley is essentially: calm down.

Not every fast-growing company is exceptional, and not every exceptional company is a good investment at any price. Probably worth remembering right now.

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