CHILE Law and Practice Contributed by: Francisco Barreda, Barreda Legal Tech
1. Trends 1.1 VC Market
15%, and agtech and foodtech with 11%. These figures were provided by the ACVC (Chilean Ven - ture Capital Association).
In 2024, approximately USD514.7 million was invested across 95 funding rounds, with an aver - age ticket size of USD1.7 million per start-up. This information was provided by the Chilean Venture Capital Association (ACVC) to the media in Chile (as of the date of this writing, the 2025 Impact Report, which covers the funding rounds from 2024, has not been published). Among the main funding rounds of 2024 were: • over USD20 million: Botanical Solution, Top - sort, and Wild Foods; • over USD10 million: PhageLab; and • over USD5 million: Fintoc, Toku, Colektia, Kilimo, and AgroUrbana. 1.2 Key Trends Due to the lack of liquidity in the market, invest - ment rounds are taking longer to close, and there is increased competition among start- ups for funding. As a result, valuation caps in investment contracts (typically SAFEs) have decreased, which benefits investors in the event of a future equity conversion. At the same time, investors are seeking more solid and well-jus - tified valuations, leading to more thorough and lengthier financial and legal due diligence pro - cesses. Finally, given the heightened competi - tion among start-ups, investors are now able to secure governance clauses – even in early-stage deals – that grant them some influence over the start-up’s day-to-day operations. 1.3 Key Industries The industries that attracted the most capital in funding rounds were greentech and cleantech, accounting for 43% of the total. They were fol - lowed by fintech and insurtech companies with
2. Venture Capital Funds 2.1 Fund Structure
They are typically structured through private investment funds managed by an administra - tor registered with the Financial Market Com - mission (CMF). Currently, there are corporate venture capital funds, family offices, and con - ventional VC funds. Some of these funds are composed entirely of private equity, while oth - ers combine equity with debt obtained through a CORFO credit line (ranging from USD6.7 million to USD89 million). It is also common to form a joint stock company (SpA) to pool capital, which is then invested in start-ups. In parallel, a sepa - rate SpA is often created to manage the fund and bring together the general partners and the VC team. 2.2 Fund Economics In general, fund principals participate in the fund’s economics by first charging a manage - ment fee, which typically ranges from 1% to 2.5% of the capital managed throughout the duration of the fund. On the other hand, they share in the fund’s success by receiving a car - ried interest, which is generally around 20%. Finally, it is common and preferred for the gen - eral partner(s) to also be contributors to the fund (due to tax limitations, they usually hold no more than 20% of the fund’s capital as contributors). 2.3 Fund Regulation There is no specific regulation for venture capital funds. Both private and public funds are gen - erally regulated by the Single Fund Law (No 20,712). However, there are certain specific ben -
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