Dinie, Brazil’s pioneer API-first embedded finance fintech, announced a USD $3.8 million seed round led by Accion Venture Lab and K50 Ventures, with participation from Flourish Ventures, Domo Invest and Tribe Capital amongst other funds, and several individuals from successful companies including Bill.com, Divvy, and more. The company also announced that it has concluded its own securitization structure securing a further USD $20 million in debt financing capacity from Empirica Investimentos, a local structured debt investor, with a portfolio under management of USD $1 billion. The investment will be used to accelerate the company’s end-to-end embedded credit infrastructure and further expose its APIs to Brazil’s largest ecommerce platforms and serve more than 15,000 MSMEs with embedded products such as Dinie Credit Account (business overdraft) and DiniePay (Buy Now Pay later for businesses).
By embedding their infrastructure and services within existing platforms that MSMEs already use, Dinie is able to reach large pools of potential MSME customers. Dinie then leverages the platforms’ data to quickly approve and underwrite revolving credit and monitor cash flow and repayment behaviors to adjust credit lines and approve new drawdowns without additional paperwork. Dinie’s digital credit account further enables MSMEs to fund their working capital and to pay for their daily business expenses.
Brazil is home to more than 17 million MSMEs with a USD $480 billion financing gap and most banks are unable to effectively serve them with financial products that are bespoke to their transactional needs, convenient and cost-effective. With MSMEs massively migrating to digital business models, particularly after the Covid-19 crisis, banks will struggle to cater for their online purchasing, digital payments, integration to digital platforms and more. These changes pose an incredible opportunity in a large underserved growth market. Ecommerce for instance, Dinie’s target market, is expected to grow by approximately 20% YoY in the next four years.
“Dinie’s vision is to enable large ecosystems such as ecommerce marketplaces to potentially become the ‘bank branch’ of MSMEs, where financial products are fully distributed and contextual, and integrated with MSMEs specific business journeys. Banks are effectively becoming invisible within the MSMEs’ user experience, who will be able to use their transactional data in exchange for bespoke, cheaper and effortless financial products,” said Suzy Ferreira, Dinie’s Founder and CEO.
Born in Berlin and launched in São Paulo in 2019, Dinie has already partnered with Brazil’s largest e-commerce enabling platforms such as iFood by MovilePay, Elo7 and Uruguayan payment unicorn dLocal. In less than 18 months of activity, Dinie has granted more than 1,500 loans, having grown by 20 times in 2020, which led it to be selected by Endeavor’s Scale-up Fintech acceleration program in Brazil. With the current round, Endeavor’s fund Scale Up Ventures also becomes an investor in the Company.
“This round has shown us that we are on the right path and it has given us the confidence to continue improving our integrated solutions within large digital ecosystems to better serve small businesses,” said Vinicius Cibim, Dinie’s Co-founder and CFO.
“Affordable credit is essential for small businesses to recover from the COVID-19 pandemic, especially in the hardest-hit countries like Brazil. Dinie is embedding credit offerings in platforms that small business owners already use to provide entrepreneurs with the financing they need to keep their doors open and provide for their families,” said Michael Schlein, President and CEO of Accion.
“Dinie’s innovative business model is emblematic of how embedded finance is a more scalable, secure, and cost-effective way of lending to underserved small businesses. We’re excited to add them to the Venture Lab portfolio,” said Federico Gomez Romero, the Latin America Investment Officer at Accion Venture Lab.
Ryan Bloomer, Founder & Managing Partner at K50 Ventures, said, “Dinie is currently the only fully digital, “end-to-end” embedded finance player in the Brazilian SMB lending space. We were very impressed with Dinie’s founding team and the key partnerships they have in place and believe Dinie is uniquely positioned for exponential growth in Brazil’s massive 70 million+ SMB market.”
Arjuna Costa, Managing Partner at Flourish Ventures, said: “We are thrilled to support female founders in a country where they make up fewer than five percent of Brazil’s startups. Suzy and Andrea are redefining the perception of MSME risk and have created a win-win scenario for both underserved business owners who need access to working capital, and the platforms that work with them. A vibrant small business sector will be a key driver of Brazil’s post-pandemic recovery, and Dinie can make a vital contribution to MSME success.”
About Dinie
Dinie (www.dinie.com) enables digital platforms to provide innovative financial services solutions to underserved micro, small and medium-sized enterprises (MSMEs) in Brazil. The company takes the complexities out of the processes for any digital platform to quickly start offering instant and embedded credit-based revolving lines and payment solutions. Dinie is a pioneer in embedded lending “as-a-service” model and Open Finance, defining the future of finance for MSMEs in Brazil. The company’s mission is to free MSMEs of the banking oligarchy in Brazil and provide them with the financial tools they need to succeed and prosper. Born in Berlin and founded in São Paulo in 2019, DINIE has already granted more than 1,500 loans, growing 20 times in 2020, which led it to be selected for Endeavor’s acceleration program Scale-up Fintech.
About Accion Venture Lab
Accion’s seed-stage investment initiative Accion Venture Lab provides capital and extensive support to innovative fintech startups that improve the reach, quality, and affordability of financial services for the underserved and have the potential to scale. Backed by commercial and impact investors since the launch of its third-party fund in 2019, Venture Lab has invested in more than 50 early-stage startups that operate in 30 countries worldwide. Venture Lab is a part of Accion, a global nonprofit committed to creating a financially inclusive world, with a pioneering legacy in microfinance and fintech impact investing. Accion catalyzes financial service providers to deliver high-quality, affordable solutions at scale for the three billion people who are left out of – or poorly served by – the financial sector. For 60 years, Accion has helped tens of millions of people through our work with more than 160 partners in 55 countries. For further information, visit https://www.accion.org/venturelab.
About K50 Ventures
K50 Ventures invests in founders around the world that are on a mission to make life better for the 99%. Our thesis is simple: improve the lives of billions around the world by making health, education, finance, and housing more affordable, accessible, and sustainable. We firmly believe that the next generation of industry-changing companies will solve real problems for the masses. Since 2016, we have been an early investor and supporter of 150+ companies across the US and Emerging Markets. Some highlights of the portfolio include Self, Mammoth Biosciences, Frubana, Groww, Real, Narmi, Shef, Easyknock, and more. Visit k50ventures.com to learn more.
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