Johanna Posada, Elevar Equity: Driving Impact in Latin America via Venture Capital, Ep 79

Category: Crossing Borders Podcast, Mexico
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Originally from Mexico, developing microfinance in Latin America and India was a natural step for Johanna Posada. With over 15 years of experience working in corporate finance, economics, microfinance and investing in emerging markets, Johanna, now based in Seattle, has long been involved in economic development. Currently, as Managing Director and Founder of Elevar Equity, an impact investment fund that focuses on fintech in both of those regions, Johanna has been able to find an intersection between work that has a social component and is also business oriented.

Elevar Equity targets investment in transformative and scalable businesses focusing on underserved customers. In this episode, I sat down with Johanna to talk about her experience and lessons learned from managing four funds with more than $270M assets under management, helping startups through multiple exits and impacting millions of people. We also cover her experience in microfinance and how the ecosystem has evolved over the years, her reasons for choosing LatAm and India, why foreign investors should be looking into the LatAm investment scene, and what the future holds for Elevar.

Check out this episode of Crossing Borders to learn about Latin America’s impact investing space, and how the Elevar investment method helps people at the bottom of the pyramid build their businesses.

Elevar’s Three Pillars of Investment

The concept of impact is unique to every company, and Elevar Equity is no exception to that. Aligning their business model to meet the needs of underserved customers is an essential part of the company’s thesis. When investing, Johanna mentions three pillars to keep in mind: the community that is being served, what is the best price-point and quality, and scale.

Check out this episode of Crossing Borders to learn more about the three pillars of impact according to Elevar Equity.

Founder Focused Investing

Johanna is a firm believer that entrepreneurs should be chosen for their skills and their drive, not their gender. Recent conversations about this topic have led her to collaborate with the IDB and other local actors to create more visibility for women in fintech. The issue is not necessarily that women are not participating in the sector, says Johanna. In fact, some studies say that 40-50% of companies have a female co-founder! However, in many cases where the cofounder is a woman, the voice of the company tends to be a man.

Although positive discrimination is well-intended, Johanna explains that opting to invest solely on women can sometimes get complicated from a fund’s perspective as it limits the pipeline from which to choose. Hear Johanna talk more about the value that a female perspective can bring to a company in this episode of Crossing Borders.

What makes LatAm interesting from a macro and micro perspective

Johanna explains why there is so much potential in regions like LatAm and India that could be interesting for investors. These reasons include changing consumer and workforce demographics, mobile phone and financial penetration, and regional macroeconomic disruptions that are turning LatAm into a powerhouse. Johanna considers that these factors combine to create resilient communities that are essential for innovation and growth in companies.

Find out how Johanna sees potential in emerging economies in regions like LatAm in this Crossing Borders episode.

Johanna Posada has had the opportunity to see the microfinance ecosystem evolve in the region throughout the past decade. She’s managed four funds, of which, one is fully divested, two are fully invested, and the fourth is in the process of investment. Whether it’s from Elevar Equity’s offices in Bangalore, Bogota, Mexico City or Seattle she strives to bring success to underserved customers.

Check out this Crossing Borders episode to learn about Johanna’s passion for combining finance with development and how she has become a leader for impact investing in the region.

Show notes:

  • [1:53] – What is Elevar?
  • [2:44] – Where in the world do you invest?
  • [3:08] – About offices in India and Latin America.
  • [5:25] – Getting into impact investments.
  • [7:27] – Microfinance ecosystem in 2004-2005
  • [9:31] – Biggest lesson learned from first $24M fund.
  • [11:49] – Staying true to the customer and client in impact investing.
  • [13:46] – What constitutes impact for a company?
  • [16:13] – After the $24M fund, what happened next?
  • [19:00] – Favorite company investments in LatAm and India.
  • [23:51] – About fintech and financial inclusion; things people in the US take for granted.
  • [26:44] – About Elevar Fund II.
  • [27:17] – Experience with exits in LatAm.
  • [28:45] – Do you see new exits coming from Asia or LatAm?
  • [30:10] – Why should we be investing in LatAm right now?
  • [31:26] – Genderless investing.
  • [34:50] – Johanna’s top resources for entrepreneurs
  • [36:03] – Johanna’s advice to her younger self
  • [37:14] – What’s next for you and Elevar?

Resources mentioned: