LATAM's fictional unicorns

By Claudio Barahona Jacobs

The Realistic Optimist is a paid newsletter covering the globalized startup scene.

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Biography

Claudio Barahona Jacobs is the managing partner at Alaya Capital, a VC based in Chile.

He previously led Wayra, the corporate venture capital (CVC) arm of Telefónica, a large Spanish telco conglomerate.

Was 2021’s funding fury a net positive or negative for LATAM’s startup ecosystem?

From a purely financial point of view, it wasn’t good. 2021’s roaring enthusiasm led to over-optimistic investments and outlandish valuations. Many VCs will not return the multiples they promised and many founders won’t exit their company for the valuation they were given. Financial expectations won’t be met and there will be a lot of disappointment. 

That being said, 2021 put LATAM’s ecosystem on the map. It gave the region’s startups unprecedented resources to blitzscale, try new things… Play money for founders to cut their teeth on various topics. 

But too much of anything is noxious. 

You talk about the concept of “papercorns”. Can you elaborate?