The turnover of used cars is about 400 billion reais ($100 billion) a year, and investors are hoping for an aggressive turnaround. More than 14 million used cars were sold in 2018.
Monashees Capital and Canary also invested in Volanty in this round after last year providing 19 million reais ($4.8 million), as well as 2.5 million reais ($630,000) in 2017, Reuters said.
Launched in 2017, Volanty digitally connects second-hand car buyers and sellers. It also has brick-and-mortar dealerships where the cars are traded.
“We will have hundreds of centers around the country in the coming years,” Volanty Co-founder and CEO Mauricio Feldman told Reuters.
Volanty said the funds will help it speed up expansion efforts with new appraisal centers planned in Sao Paulo. New staff will also be hired, including industry executives.
SoftBank launched a $5 billion Latin America fund in March, the largest investment of venture capital funds the region has seen. It also rolled out a $2 billion fund that will target Latin American technology companies. Planned are investments in eCommerce, FinTechs and healthcare. Funds will also help existing portfolio companies expand in Latin America.
SoftBank already invested $100 million in 99, a Latin American ride-hailing company that was acquired by Didi Chuxing. Earlier in March, Softbank led a $4.5 billion investment in the Southeast Asian ride-hailing startup Grab.
While cash remains king in Latin America with around two-thirds of consumers preferring it over credit, the FinTech market is starting to expand, presenting opportunities for venture capitalists and startups. It is home to more than 630 million people and has important economies, including Brazil and Mexico.
Latin America still doesn’t have its own version of Silicon Valley, but the region is making progress in the digital space with FinTech startups leading the push. With roughly half the population in Latin America unbanked, it presents an opportunity for FinTechs to create solutions, such as mobile payments that can bring greater financial inclusion.