Tiger Global Invests $25M in LatAm Fintech Swap

Swap Secures $25 Million Series A Funding

São Paulo-based BaaS startup, Swap, has recently announced the completion of a $25 million Series A funding round, spearheaded by Tiger Global Management.

The company reports that this financing round was significantly oversubscribed. To date, Swap has raised a total of $28 million since its founding in October 2018.

Investor Participation

This latest investment round saw participation from a diverse group of investors. These include Endeavor, Justin Mateen – the co-founder of Tinder – partners from DST Global, ONEVC, Global Founders Capital, and Flourish Ventures.

Previous investors, such as Canary, Ariel Lambrecht – co-founder of 99, Brazil’s first unicorn – and Guilherme Bonifácio, iFood’s co-founder, also contributed to this funding success.

Swap's Core Mission

Founded by Douglas Storf, Ury Rappaport, and Alexandre Takinami, Swap is dedicated to enabling businesses to revolutionize their financial processes. The company provides APIs that deliver the necessary infrastructure for a variety of financial solutions, empowering users to monetize their platforms effectively.

The genesis of Swap stemmed from the founders’ experiences at 99 (formerly 99Taxis). Storf and Rappaport identified a need for financial products tailored to the transport app’s driver partners, recognizing a broader market opportunity for an infrastructure service.

Impressive Growth Trajectory

Swap has demonstrated substantial growth in recent times. Over the past year, its customer base has expanded by an impressive 300%.

Furthermore, the company has consistently achieved a monthly growth rate of 30% and a year-over-year increase of 7,500%, with profitable results reported in the third quarter of the year, according to CEO Douglas Storf.

“We are successfully demonstrating product-market fit and are actively assisting an increasing number of companies in integrating financial offerings into their products,” Storf stated.

Expansion Plans and Specialization

Currently operating within Brazil, Swap intends to utilize the newly acquired capital to broaden the scope of its services within the country.

The company’s strategy centers on specialization, both from a market and a technological standpoint.

“Our goal has always been to provide a comprehensive, integrated solution that allows companies to launch their fintech ventures quickly and efficiently,” explained Storf. “We go beyond simply processing cards, offering a complete solution tailored to specific segments, acting as their bin sponsor, card processor, partner bank, and providing all essential core infrastructure.”

A Full-Service Approach

The CEO emphasizes that this full-service approach distinguishes Swap from other BaaS providers in the market.

Swap also prioritizes addressing the specific challenges faced by different segments. For instance, the launch of Multiflex in early 2021 catered to flexible benefits companies, followed by the Swap Credit platform in September 2021, designed for companies in the credit sector.

Ultimately, the company aspires to become “LatAm’s fintech factory.”

Current Clientele

Swap currently serves 15 customers, including Swile, Portão 3, Z1, BMP Money Plus, and A55.

Future Outlook

Storf anticipates that as its customers expand into other Latin American countries, a natural progression will be to extend Swap’s reach into new markets beyond Brazil.

The company began 2021 with a team of 27 employees and has since grown to 60. It plans to double its workforce in 2022, focusing on hiring across product development, operations, and sales.

Industry Perspectives

Alex Cook, a Partner at Tiger Global, notes the significant increase in the number of fintech companies and use cases in Latin America, leading to reduced costs and improved experiences for both consumers and businesses.

“We are excited to collaborate with Doug, Ury, and the Swap team as they develop a modern card issuing and banking infrastructure platform for the next generation of financial services companies in Brazil,” Cook stated.

Fabricio Pettená, Partner at Global Founder Capital, highlights that this is their third investment in Swap, emphasizing that Swap has “completely reinvented banking as a service in Brazil, extending beyond card acceptance to include credit and vertical solutions.”

Bruno Yoshimura, general partner and co-founder of ONEVC, points out that Swap currently offers two key products: card-as-a-service and credit infrastructure.

“Their next step is to actively listen to customer needs and develop additional building blocks,” Yoshimura said. “With three former CTOs on the core team, I am confident they possess the right expertise to build an AWS for fintechs in LatAm.”