With funding from Monashees, Latú needs to convey cyber insurance coverage to SMEs
When the Colombian Paola Neira was still in high school, she set up a fund with a group of friends to raise funds for her graduation party. Contrary to what usually happens, the crowdfunding didn’t end with the celebration — it turned into a fund of friends who started to make loans, helping small businesses in Colombia to advance resources.
After the pandemic, many of these companies began to need guarantee insurance, which caught the attention of Neira, who decided to start the business in Brazil, where the number of small and medium-sized companies is high and growing. Named Latú, the startup has just raised $6.7 million in a seed round led by Monashees and Charles River Ventures (CRV), an American venture capital firm that emerged in the 1970s.
The contribution had the participation of ONEVC, Latitud and SV Angels. Rappi’s founders (Simon Borrero, Sebstian Meija and Felipe Villamarin), Addi (Santiago Suarez and Daniel Vallejo), Tul (Enrique Villamarim) also make the list as angel investors.
“It’s a very small round for such a huge opportunity as business insurance. In Latin America, less than two companies out of ten have a policy”, said the founder of Latú to Pipeline. Meanwhile, in the United States, seven out of ten companies have some form of insurance (on average, three policies).
Graduated in economics at the Universidad de Los Andes, the entrepreneur began her career at Credit Suisse. She then worked at a Uruguayan M&A and debt firm before moving to Dubai, where she began to approach the world of technology acting as a technology and private equity analyst for Latin America Abraaj Group. Back in Colombia, Neira immersed herself in the startup ecosystem and was one of the leaders of the technology team that developed Rappi’s logistics — during this period, Brazil was one of her bases of work —, from where she recently left precisely to set up the Latu.
At insurtech, Neira will apply technology to offer a risk analysis capable of guaranteeing the existence of products such as surety bonds and against cyber attacks for digital SMEs, an unexplored niche.
In practice, the policies will be offered by partner insurers that will use the technology that has been developed by Latú. Insurance coverage should range from $10,000 to $10 million. The idea is to serve SMEs with surety bonds, cybersecurity products and policies against errors and omissions (D&O) for executives from small businesses or startups. D&O insurance, very common in large companies, is not very accessible to other businesses, a situation that a startup in Neira wants to change.
With the resources of the round, the startup will increase the team. The expectation is that the first policies with Latú’s technology should be issued by the end of the year.
Source: Value Pipeline