Brazil’s Indicator Capital, a LatAm IoT-focused VC fund, is enlisting four new investments as it resumes allocations following market uncertainties seen in the first half of the year.
“In the last few months we have taken our foot off the gas a little, after the market turmoil, [the fallout] of Silicon Valley bank, etc. But the scenario has already improved. We already have four term sheets [preliminary deals] approved, which should be closing before the end of the year,” Fabio Iunis de Paula (in photo), co-founder and general partner of Indicator Capital, told BNamericas.
Indicator has made seven investments to date through its Fundo Indicator 2 IoT, which claims to be the largest fund exclusively dedicated to early-stage IoT projects in Latin America.
The investees were startups Monuv (smart cameras), CTA Smart (fuel logistics automation), Syos (cold-chain management platform), Rúmina (livestock digital solutions), Beegol (Wi-Fi improvement platform), InfoPrice (retail pricing solution) and IBBX (wireless energy technology).
At present, the fund has 333mn reais (US$68mn) in resources raised from investors, said Iunis, following two separate closings.
The company's first closing was for 240mn reais, with eight main investors including anchor-investors Brazilian development bank BNDES and Qualcomm Ventures, plus Banco do Brasil, Motorola, Lenovo, 3G Radar, Telefônica and Multilaser.
In a second closing at the end of last year, Indicator brought in nearly 100mn reais more in resources to the fund with FAPESP (São Paulo state research development agency), Badesul (Rio Grande do Sul development bank) and Sebrae (Brazil's SME supporting agency), among others, as investors.
A third and final closing for fund 2 is not ruled out, although in Iunis' opinion it might not be necessary.
“The more the fund matures, the less likely it is to make new rounds of funding,” he said.
Iunis sees good prospects for the IoT segment, betting on new trends such as hardware-as-a-service (HaaS), that is, the leasing of hardware by companies instead of the acquisition of the equipment.
“IoT is maturing in a way that is very transparent to users, whether they are consumers or businesses. And HaaS is a good example of this. It’s a business model for you to use IoT and have the use of hardware combined with software. An easy way to contract and employ IoT smartly.”
Another trend cited by the executive is the so-called AIoT, the combination of artificial intelligence with IoT, including generative AI.
In Iunis’ view, the generative AI boom “is also an IoT boom.”