ARGENTINA Trends and Developments Contributed by: Manuel Tanoira, Lucía Rivas O’Connor, Luis Merello Bas and Dolores Nazar, TCA Tanoira Cassagne
Overview of the Venture Capital Market in Argentina History and evolution of venture capital in Argentina The venture capital (VC) market in Latin America is relatively new, taking shape in the late 1990s and early 2000s during the dot-com bubble. In Argentina, VC grew with globalisation and tech - nological advancements, attracting both local and international investors. However, economic instability and financial crises limited its sus - tained growth. Initially, the government, NGOs and private organisations (such as Endeavor, IAE Business School, and Universidad de San Andrés, among others) played a key role in fostering innovation and entrepreneurship. As the region was – and continues to be – developing, both countries and entrepreneurs learned how to create, finance and scale global companies. From 2010 onward, with partial economic recovery and the prolif - eration of tech start-ups, Argentina’s VC mar - ket strengthened, supported by unicorns like Mercado Libre and Globant, which proved the potential of the sector. Between 2020 and 2022, Argentina experienced significant growth in VC investments. In 2020, approximately USD330 million was invested in Argentine start-ups. This amount surged in 2021, reaching a record USD2.1 billion across 27 deals, more than a sevenfold increase from the previous year. However, investments declined in 2022, with 54 financing rounds totalling USD480 million. This trend was consistent with the global landscape, where VC investments also experi - enced a downturn during the same period. Throughout 2023, VC activity slowed due to a global liquidity crisis. Funding declined, valua -
tions fell and start-ups struggled to close rounds. In 2024, Argentina saw a partial recovery. Impact of the global crisis and venture capital recovery in Argentina During the pandemic, the massive liquidity injec - tion from the US to drive digital transformation inflated fintech and tech valuations. The subse - quent rise in inflation led the US Federal Reserve to tighten monetary policy, reducing available capital. Latin America, one of the least-funded VC regions, was hit hard as limited partners (LPs) scaled back investments. In Argentina, the downturn was most severe from late 2022 to 2023, with many funds pausing investments until market conditions stabilised. The expected 18-month correction extended to 24–36 months. By 2024, Argentina’s VC ecosystem began to show signs of recovery, driven by strategic sec - tors such as biotechnology (biotech), agritech and foodtech. Corporate funds such as SF500, GridX, CITES and Sancor Seguros Ventures remained active. Additionally, The Yield Lab secured significant funding from Bimbo and Nestlé, driving its fund III and injecting liquidity into the agrifoodtech sector. However, not all industries recovered equally. Blockchain, for example, suffered a severe drop in valuations, while fintech adjusted its multiples. Despite a general slowdown in bank invest - ments, players like Galicia Ventures and BYX Ventures (BYMA) remained active. In early 2024, VC activity picked up, but uncer - tainty around the US elections slowed new fund and capital commitments. However, Argentina gained traction as an investment destination, especially in lithium, oil and gas, mining and the knowledge economy, leading to increased cor - porate and VC interest.
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