Valor's 10th Annual Summit Recap
Last month Valor hosted its 10th Annual Summit. After a 2-year hiatus of the in-person version of our summit, we were glad to have portfolio founders, investors, our own team and the broader Valor network in New York.
We were able to hear from industry leaders on a variety of topics, from the future of Crypto after FTX to the main trends in Climate Tech and the investment landscape in US, Brazil, Mexico, and broader Latina America.
Below are the main insights from each of the panels we had at the conference:
Leadership in the Spotlight
Our session started with a great fireside chat between Scott Sobel, Valor’s Managing Partner, and Mike Kirban, founder and CEO of Vita Coco. Mike shared his experiences in building and scaling a successful consumer brand in the US, providing valuable lessons to our founders. “Hire attitude over experience, especially in the early days. You want people that adapt and move the way that you move”, said Kirban on hiring your founding team.
Mike also told the audience how Madonna – the singer – became a partner at Vita Coco and how it helped the company’s marketing strategy throughout the years. “Having a celebrity as an investor can be an amazing opportunity. Instead of only being compensated for the marketing campaigns they make, they really have skin in the game.”
The talk ended with Mike sharing a few war stories from Vita Coco’s early days, as well as some final insights to the founders in the room, explaining the extreme importance of resilience in the journey of a founder. “The ability to just keep going is what allows entrepreneurs to do and achieve what seems impossible”.
https://npw.gpe.temporary.site/wp-content/uploads/2022/12/filipwolak-valor2022-0779-2785-scaled.jpg
The Future of Crypto
Our Crypto panels took place right after the first news of FTX’s insolvency started to emerge. Our two panels on the topic, “Institutionalization of Crypto” and “Crypto Reshaping the Financial System and Payments”, couldn’t be timelier.
The first panel was moderated by Brian Brooks, the former US Comptroller of the Currency, and had the presence of Ricardo Marino, CEO of Itau Latam, Mike Novogratz, CEO at Galaxy Investment Partners and former Goldman Sachs partner, and Rep. Trey Hollingsworth, House Representative for Indiana’s 9th district.
Mike Novogratz pondered on how FTX’s then imminent insolvency would impact the ecosystem in the long run. Mike believes that the reasons why cryptocurrency will thrive haven’t changed because of FTX’s failure.“The space isn’t going away, there is an inevitability to it in many ways. We are seeing an increasing number of institutional investors looking at the space as well as tech companies building on top of blockchain”.
There were also great discussions involving the regulatory landscape in Crypto and how it will evolve, with focus on stablecoins. Rep. Hollingsworth, while recognizing that DC sees Crypto in general as highly unstable area and that Americans still have some gap in terms of education around crypto-related investment products, believes that the country can make iterative progress toward a coin. Mike echoed the optimism towards stablecoins in the US:“Imagine if the US Dollar competed not only on liquidity and store of value, but also on utility anywhere in the world”.
Ricardo Marino provided great insights into the Crypto adoption in Latin America.“Clients, ranging from large institutions to retail and private investors are demanding crypto solutions, despite the current state of the market”, claimed Marino regarding the organic adoption of crypto being seen in Brazil and Latin America. Finally, Marino also described what he believes are the conditions for true institutionalization of Crypto in a country:“Regulation, governance / risk management and task clarity are critical points of development for any nation to develop institutionalization of Crypto”.
Crypto and the Revolution in the Financial System
The second Crypto panel focused on the new payment and investment solutions that are arising from blockchain-enabled solutions. Jack Mallers, founder of Strike, Thomas Bohner, founder of Credix and João Reginatto, VP at Circle, took part on the panel moderated by Michael Nicklas, Managing Partner at Valor.
Mallers elaborated on how Crypto is now profoundly changing the way payments – especially international remittances – are made.“Bitcoin is one of the biggest innovations in the last 50 years. It enables payments to be made at the speed of light at no cost.”. He further elaborated on the Lightning Network, used by Strike “The Lightning Newtork is the equivalent of transferring anything of value across the world”. And finished with how crypto enables financial inclusion with instant payments technology. “There is no opportunity for innovation if the collective financial system deems a person unworthy of credit because of the place he or she lives in the world”.
Thomas Bohner built up on the argument, indicating that Crypto and DeFi are enabling credit concessions to smaller agents of the economy:“If there is no data standard on what assets really look like, things can go wrong very quickly. Now we can create data standards around assets and move them globally at almost no cost”.
Finally, João Reginatto gave his views on the social importance that stablecoins, enabled by Circle, have.“Stablecoins just reinforce the strength of the Dollar. Dollar stablecoins have been an incredible phenomenon around the world – when currencies collapse, people have a super easy access to holding Dollars”.
The Macro Landscape in Brazil
Our crypto session was followed by a great discussion on the future of the Brazilian macroeconomic landscape. Jes Staley, former CEO of Barclays, Henrique Meirelles, former Governor of the Brazilian Central Bank, and William Waack, Brazilian journalist, joined Amb. Clifford Sobel on the discussion.
Jes Staley initiated the discussion highlighting what he believes are the greatest strengths that Brazil has. “I have long believed that one of Brazil’s greatest assets is the diversity of its population. Brazil has shown an ability to manage diversity in a great way. Diversity is one of the criteria for innovation and innovation is one of the criteria for the creation of technology and economic development”
Henrique Meirelles showcased his extensive knowledge of the Brazilian macroeconomic space, claiming for productivity-focused reforms and agendas so that Brazil can sustain prolonged periods of sustainable growth“Productivity reforms are necessary so that the growth potential can be improved. I think that the conditions are here for Brazil to grow. Brazil had a debt problem for years and this problem was addressed and resolved, bringing important fiscal stability for the country”.
William Waack pondered that while there is a great opportunity for Brazil to grow, the new government to initiate in 2023 will need political articulation and savviness to execute a true growth trajectory.“The window of opportunity is there – it requires a lot of political wisdom, and the main lever for this is fiscal responsibility. Fiscal and social responsibility are effectively the same.”
https://npw.gpe.temporary.site/wp-content/uploads/2022/12/filipwolak-valor2022-0991-3250-scaled.jpg
The Mexico Opportunity
We believe there is a strong opportunity to be captured in Mexico with its booming startup and talent ecosystem, in an extremely relevant market for Latin America and the World. Our panel, moderated by Phillip Trauer, Principal at Valor, had the presence of Amb. Gerónimo Gutiérrez Fernández, former Mexico’s Ambassador to the US and Javier Alejandro García Queiroga, Director at FEMSA Ventures.
Javier mentioned how the current geopolitical can indeed help Mexico become an industrial powerhouse:“The concept of nearshoring and ally-shoring is a bipartisan issue in the US. The intent of US players to do more nearshoring is there and will be there. Mexico has a growing middle class with increasingly better preparation for higher value jobs”.
Amb. Gerónimo Gutiérrez expanded on what was mentioned by Javier, indicating that“the Mexico – US trade agreement gives Mexico a competitive edge in comparison to other countries in the world. This relationship will keep on existing”.
https://npw.gpe.temporary.site/wp-content/uploads/2022/12/filipwolak-valor2022-1162-3668-scaled.jpg
Climate Tech: The Next Big Investment Theme
Brazil and Latin America are highly strategic when it comes to investments in Climate Tech. The region is home to some of the most biologically diverse ecosystems in the Planet, being at the same time an agricultural powerhouse that helps feed the world. Antoine Colaço, Managing Partner at Valor, moderated an engaging panel on Climate Tech. He was joined by David Friedberg, CEO and founder of the Production Board, Irene Arias, CEO of IDB Lab, and Matt Harris, Founding Partner at GIP.
Irene opened the panel explaining the role of IDB in Latin America:“Our role at IDB is to make more investments to flow in high-potential sectors that can drive meaningful change”.She expanded on that, explaining why investing in change in Latin America is of extreme importance:“The social needs in the region are gigantic – by 2030 we could have 60m people going into poverty. At the same time, Latam has many priorities – this naturally makes the change from fossil to low-emission economies harder, for example”
David Friedberg explained why he is personally excited about the space:“The cost of DNA sequencing has fallen more than what Moore’s law would predict. We can finally see what is going on in the microbial world around us. In every teaspoon of soil there’s over 100 billion organisms.”
Matt Harris used his expertise in energy and infrastructure to give us his view on the industry going forward, indicating that new forms of energy generation will take over for simply economic reasons:“Why should any one of us pay the cost of a massive transmission system when we can generate it right at our rooftop?”
We are extremely excited to keep investing in the defining tech companies of Latin America and believe there are many reasons for us to be so. The emergence of talent, new investment themes and of a high-quality ecosystem composed of great companies is just beginning, and we are happy to be part of it. This summit, after 2 years of remote conferences, helped us renovate our excitement about the space – we’re sure this will be the case in one year from now, in our 11th Annual Summit.