Brazil’s financial services start-up Company, Nubank is launching its first MasterCard Platinum credit card manageable through an Android or iOS app following the $14.3 million raised by the company led by Sequoia Capital – the first Brazil investment in a start-up.
Getting a credit card in Brazil can take weeks, lots of paperwork and many visits to a physical bank: Nubank intentions are to swipe all of that away.
David Vélez, founder and CEO of Nubank who used to work for Sequoia specifically to help scout out investment opportunities in South America told Tech Crunch “After spending more than two years looking at technology opportunities with Sequoia in Latin America, we got convinced that there were a ton of high quality opportunities for starting tech companies in this country, but not in the sectors that most tech companies/entrepreneurs were pursuing,”. He went on to say “I decided to strike on my own because I had always wanted to be an entrepreneur, and as a venture investor I saw more interesting opportunities on the entrepreneur’s side of the table, than in the investor’s side of the table.”
There are also some more Brazil Investment advances that Nubank is tapping into. The country has been seeing a boom in broadband penetration, headed largely through smartphone growth. Today, there are 90 million smartphones in use among Brazil’s population of 200 million and growth is not slowing down.
“Our story is not about under-penetration of banking. It is about offering credit products to already banked customers that are currently completely overpaying in terms of fees and expenses, and getting a very poor experience in return,” he says. “Since we don’t have to pay for expensive [physical bank] branches or other costly infrastructure, we can pass those savings to our customers in terms of no fees products, lower interest rates, and excellent customer service. Our customers also don’t want to pay for that expensive infrastructure by the way.”
Brazil’s mortgage market grew from just 1.5% of GDP in 2007 to about 6.2% of GDP in 2012 and is still growing showing the attractiveness of any Brazil Investment