Bloomberg Línea — An entrepreneur since the age of 15, João Sobreira is now 22 and raised $3 million in a round led by Upload Ventures for his new company: Tipspace. Sobreira is just one of the founders who has managed to raise funds at a time when investors are being more cautious and demanding profitability plans.
These are the Latin American startups that raised funds this week:
It all started with League of Legends. From Goiânia in Brazil, João Sobreira almost was a professional player. He received an offer to join a big team, but he didn’t have the minimum age of 17 required to play professionally.
Invited to set up a League of Legends team for Flamengo, he saw an even bigger opportunity. “We spoke to several brands, and all the brands wanted to understand games, but at the time nobody knew anything,” Sobreira told Bloomberg Línea in an interview. “That’s where we started, and we set up an agency to position big brands in e-sports and games.” He left high school to become an entrepreneur, but when he turned 18 he finished school with a supplementary education.
Thus began Cursor Esports, which early on received an invested from the Go4it agency, whose clients included athletes such as Gabriel Medina, Thiago Silva and Leticia Bufoni.
Cursor and Go4it merged to create Go4it Games, where Sobreira was head of games, and he set up Flamengo’s team, won an e-sports award, and worked with influencers, media and brands.
After setting up professional team Rensga, Sobreira pivoted the business to Tipspace as he saw a big opportunity in the last year with ‘play-to-earn’ games.
“People were actually playing games to earn money, but they were being forced to play bad games to earn money, while the whole industry is playing other games, and they’re not managing to monetize. The idea of Tipsace is to transform those games and create a way to monetize them,” Sobreira said.
Tispace is a software application installed on a computer. The games work through a local API. According to Sobreira, Tipspace operates as a front-end software company that pulls information from a local back-end API, which is installed on each user’s computer.
“We use this information for our platform to run,” he explained. The player creates an account on Tispace and connects to the game account, selects who they are willing to play, and the platform matches them with a proprietary algorithm to pair up close-level players.
The player pays an entry fee, and Tipspace finds a person of the same level who wants to enter with that same fee. The match is played and when one of the two players wins, they take the entire amount, just like in poker.
But, according to Sobreira, the platform is not a game of chance, because it does not depend on a third party and the bet is not made against the house, and neither does it depend on luck.
“We are in the middle of these two talent-based gaming businesses. If you are better, you will win,” he said.
It is a category that, according to Sobreira, still does not have specific legislation in Brazil, and operates in a loophole.
To start playing, a user needs to pay the platform at least 0.50 reais, but there is no maximum value. Tipspace earns 8% of the total amount of the game. So, if each player bets 10 reais, the total amount is 20 reais. Tipspace keeps 1.6 rwais, and the rest is distributed to the winner of the match.
The player can transfer money to and from the platform by Pix, credit card, or digital transfer through integration with LatAm Gateway, a company that also runs the payment gateway in Brazil for Binance.
Tipspace’s idea, which begins operations this month, is to transact $17 million in a year and capture more than 100,000 players in Brazil.
“In five years we want to have one million users in Brazil, the United States, and Mexico,” said Sobreira.
Minteo, a startup that wants to bring Web 3.0 closer to Latin America through NFTs, closed a seed investment round for $4.3 million, led by investors who have funded companies such as TikTok, Sorare, and Coinbase.
The investors include Fabric Ventures, Dune Ventures, CMT Digital, Susquehanna Private Equity Investments, Impatient VC, OpenSea Ventures, FJ Labs, SevenX Ventures, Big Brain Holdings, G20 Ventures, and Alliance DAO, among others.
Minteo seeks to simplify the experience of buying and selling NFTs by making them available to any Latin American with a smartphone through an app.
By having a strong focus on creators and han enterprise offering, Minteo hopes to facilitate access to NFTs for thousands of digital content creators and companies who want to start participating in Web 3.0 and the metaverse economy.
Founders Santiago Rodríguez, Javier Lozano, William Durán, and Sebastián Salazar have created companies such as Vlipco, the company that ran Wompi and which was sold to Bancolombia in 2021; and Easy Taxi, which was acquired by Spanish transport app Cabify.
Mexican fintech startup Solvento, which builds payments infrastructure for Latin America’s trucking industry, closed a $5 million round led by Texas fund Ironspring Ventures, in which Quona Capital, Proeza Ventures, Dynamo Ventures. Susa Ventures, 9yards Capital and Supply Chain Collective.
Solvento has built a payments infrastructure and financial operating system for the logistics and road transport sector on a single platform. Founded in 2021 by Jaime Tabachnick and brothers Pedro and Guillermo Bosch, the startup secured the investment a year after raising a $1.5 million pre-seed round, led by Dynamo Ventures, and in which Wollef Ventures and Zenda Capital also participated.
The current round also included angel investors with entrepreneurial backgrounds, such as Felipe Capella, CEO of Loadsmart, a logistics unicorn in the US, and Alexis Patjane, founder and CEO of Mexican logistics startup 99minutos.