Why we invested in Flink

I remember my feeling going out of ALLVP’s office on a Sunday morning, the 25th of October 2020.

Flink is now bigger than the entire retail market in Mexico and is growing rapidly.

Traditionally, buying and selling stocks for a retail investor has been expensive, outsourced, and/or inaccessible in Mexico. Only 300,000 investors were active ending 2019 according to the CNBV, representing less than 1% of the population having an investment account. And yet, Sergio, Ricardo, and their amazing team acquired one million (!!) new users on their brokerage product in less than 8 months after lunch. Most were first-time investors. By offering a product that wasn’t accessible before, Flink suddenly became one of the fastest-growing fintech startups in Mexico and even reached the #1 position in the Mexican Google Play store in January 2021.

We believe Flink is different from players in more established markets because of the maturity of its customer base: Flink is creating a market.

Robinhood’s success story, as well as its peers around the world, has been well documented and is well-known in the fintech industry. It would be easy to put Flink in the same category. However, we believe that challenges and opportunities they face tend to be different than for players in the US for example, where 32% of the population already has an investment account. As we mentioned, this proportion used to range below 1% in Mexico, and most people had never invested before. With Flink, they were suddenly able to invest in the stock market starting from 30MXN! We believe this approach is going to be transformational for personal finance management across LatAm, and create a whole new market.

Flink is in the business of making sophisticated tools and value creation opportunities available to a market that has never had access to these offerings until now. It is a huge opportunity that also comes with a lot of responsibility to do it right.

By transforming the way people invest and by creating a new market, Flink truly has the potential to reshuffle the cards of financial inclusion in LatAm. This comes with considerable responsibilities, like educating their customers, allowing them to navigate the markets, and giving some guidance when the market dynamics could put its Flinkers at risk. We were proud to witness Flink’s reaction to GameStop’s recent volatility, and the markets’ as a whole a few days ago.

We believe our market opportunity with Flink extends beyond Mexico to other emerging markets like Chile and Colombia.

The preconditions are now in place for us to offer this quality of service across all markets. Smartphone penetration has been growing at a huge pace in the past decade, reaching 90%+ in LatAm. There are now financial services platforms to tie into, and the market has been seeking savings and investment solutions. Every day, Flink is receiving demands from customers from places like Chile, Colombia, and Central America, and intends to seize the opportunity and the challenges that will come along with it.

02.02.2021 — Celebrating one million (!!) users

VC @ALLVP, Investing in Fintech in LatAm

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