In a show of fresh confidence in the region amid a funding slowdown, payments behemoth Visa Inc agreed to purchase Brazilian fintech platform Pismo for $1 billion in cash on Wednesday.
The Pismo acquisition is both the largest publicized startup exit thus far this year and the largest fintech exit in Latin America since Nubank went public in late 2021.
This is Visa, the largest payment processor in the world’s first significant acquisition since 2021 when it paid $2.2 billion for both the British cross-border payments company Currencycloud and the European open banking platform Tink.
Pismo, a Sao Paulo-based company, offers the technology through which clients can issue Visa and Mastercard cards. Pismo’s cloud-based platform for financial institutions supports more than 70 million accounts and handles more than $200 billion in transactions annually.
It was earlier this year that Mastercard reportedly expressed interest in buying the company’s banking infrastructure. A request for comment was not immediately met with a response.
According to data provider Sling Hub, the acquisition coincides with an 82% year-over-year decline in venture capital in Latin America in May as high-interest rates and concerns of a recession rattled up global markets and lowered tech prices.
Pismo will keep its present management team as part of the agreement, which Visa said is anticipated to finalize by the end of the year.
Entrepreneurs Ricardo Josua, Daniela, Juliana, and Marcelo Binatti started the seven-year-old business. In addition to these regions, it also operates in Southeast Asia, India, and Latin America.
Pismo has garnered about $110 million from investors including Japan’s SoftBank Group Corp, Amazon.com Inc, startup capital firm Accel, and Headline, which initially invested in the seed round and owns roughly 30% of the company.
