This is Part 2 of Brazilstrat’s series about the Brazilian Unicorns. Links to the other parts can be found here: “Part 1 – Introduction and Summary”; “Part 3 – Wildlife Studios”; “Part 4 – iFood”; “Part 5 – Loggi”; “Part 6 – QuintoAndar”; “Part 7 – Ebanx”; “Part 8 – Loft”; and “Part 9 – Gympass”.
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The digital-only bank Nubank was founded in São Paulo in late 2013 by David Vélez (CEO) together with Cristina Junqueira (VP Branding) and Edward Wible (CTO). Only six years after being founded, Nubank reached 13 million clients across all of Brazil’s 5 570 municipalities, making it the country’s sixth largest financial institution and the world’s largest independent digital bank by number of clients.
Nubank began its international expansion by opening an office dedicated to infrastructure and data engineering in Berlin, Germany, in 2017, and in 2019 it opened offices for its consumer facing operations in Mexico and Argentina, two other Latin American countries with high potential for improved user experience in the banking sector. According to a LinkedIn ranking, Nubank was the most popular startup to work for in Brazil in 2019.
David Vélez, originally from Colombia, got a bachelor’s degree in management science and engineering and later an MBA from Stanford University. He spent his early career as an analyst at Goldman Sachs and Morgan Stanley in New York before joining the New York-based venture capital firm General Atlantic as senior associate with responsibility for the firm’s Latin American investment programme. General Atlantic later invested in Brazilian unicorns QuintoAndar and Gympass as well as the now publicly traded Arco Educação. Continuing in venture capital, Vélez started working for Sequoia Capital, a firm based in Menlo Park, California, in parallel with his Stanford MBA. He moved to São Paulo as responsible for Sequoia’s Latin American investments in 2011. The idea of Nubank came as a result of Vélez experiencing the bureaucracy of opening a bank account in Brazil. Nubank’s first product, a no-bureaucracy, zero-fee credit card with everything being managed from an app, was launched in September 2014. In the early years of Nubank Vélez sat on the board of another Latin American unicorn, the Argentinian online travelling agency Despagar which is now listed on Nasdaq. He has also invested in other Brazilian startups including Loft.
Edward Wible, an American, studied computer science at Princeton University before working two years as an associate at The Boston Consulting Group (BCG) in New York, followed by three years in London with the same title at Francisco Partners, a technology-focused private equity firm. Wible got his MBA at INSEAD in France before joining Vélez as co-founder and CTO in April 2013.
Originally from Ribeirão Preto in the state of São Paulo, Cristina Junqueira moved to Rio de Janeiro with her family as a baby. She returned alone to São Paulo – this time the state capital – at the age of 17, where she combined a bachelor’s degree in industrial engineering at the University of São Paulo (USP) with internships at Brazil’s biggest bank, Itaú, and Allen Hamilton, a management consulting firm. Her master program, also in industrial engineering at USP, was combined with almost three years as an associate consultant at BCG. After getting her master’s degree, Junqueira was selected for a one-year accelerated MBA Program at Kellogg School of Management in Evanston, Illinois. Back in Brazil she returned to the Itaú system in São Paulo where she worked as a superintendent at Unibanco, Head of Marketing and Products at LuizaCred, and finally Credit Card Portfolio Manager at Itaucard before joining the Nubank team as co-founder and later VP Branding in May 2013.
Sequoia Capital, David Vélez’ previous employer, led Nubank’s $2 million seed round in June 2013 where Kaszek Ventures, originally from Argentina, also participated. Nubank has received a total of $909 million between eight rounds (including seed). Unicorn status with a valuation above $1 billion was achieved when $150 million was raised in a series E round in February 2018, and Nubank became Brazil’s first “Decacorn” and Latin America’s most valuable startup with a valuation above $10 billion in its $400 million F round in July 2019. Amount and investors in each of the eight financing rounds are listed below.
- Seed: $2 million in June 2013. Investors: Menlo Park, California-based Sequoia Capital and Buenos Aires and São Paulo-based Kaszek Ventures.
- Series A: $15 million in August 2014. Investors: Sequoia Capital and Kaszek Ventures.
- Series B: $30 million in May 2015. Investors: New York-based Tiger Global Management; Sequoia Capital; Kaszek Ventures; and Alexandria, Virginia-based QED Investors.
- Series C: $52 million in January 2016. Investors: San Francisco-based Founders Fund; Tiger Global Management; Sequoia Capital; and Kaszek Ventures.
- Series D: $80 million in December 2016. Investors: Hong Kong-based DST Global; Sequoia Capital; Founders Fund; and Tiger Global Management.
- Series E: $150 million in February 2018. Investors: DST Global; QED Investors, Menlo Park, California-based Redpoint Ventures; Palo Alto, California-based Ribbit Capital; San Francisco-based Dragoneer Investment Group; and New York-based Thrive Capital.
- $180 million raised in October 2018 from Singapore-based Tencent.
- Series F: $400 million in July 2019. Investors: Menlo Park, California-based TCV; Tencent; DST Global; Sequoia Capital; Dragoneer; Ribbit Capital; and Thrive Capital.