FAQ´s
General
What is a startup?
A startup is an emerging company based on an innovative technology or business model, that normally comes from the technology industries and has high growth potential. Startups tend to raise capital from angel investors (high net worth individuals investing in startups) or venture capital firms (specialized firms investing in startups). Founders of the startups tend to have an exit plan for the company by selling it to a strategic acquirer, or via an Initial Public Offering.
What is Venture Capital?
Venture capital (VC) is a form of private equity financing that is provided by venture capital firms or funds for early-stage startups with high growth potential. Venture Capital firms invest in these types of companies in exchange for a minority ownership and take on the risk of financing them in hopes that the startups they support will become successful from an impact and financial perspective.
If you want to understand how Venture Capital works, we highly recommend reading “Venture Capital” and “Venture Capital: What It Is & Why Use It”.
Who is Dalus Capital?
Dalus Capital is a venture capital firm (a firm that invests in early-stage startups with high-growth potential) based in Mexico that invests throughout Latin America.
Investment Thesis
What sectors does Dalus Capital focus on?
We invest in four main themes, which are Inclusion, Climate Innovation, Business Productivity and the Digital Consumer.
Does Dalus Capital focus on a specific investment stage?
We are focused on early-stage financing rounds, in startups that have a validated product and client traction. The stages in which we invest in are commonly known in the venture capital industry as Seed, Series A & B financing rounds (the later the letter, the later the financing round).
Our investment size per startup ranges from $500,000 to $6 million dollars, and we reserve capital for follow on investments, as the company raises subsequent financing rounds.
Does Dalus Capital focus on a specific region?
We are primarily focused on companies that operate in Latin America or that are strongly connected to solving problems in Latin America. We also connect Latin America with other innovative regions of the world.
What type of startups does Dalus Capital partner with?
We partner with exceptional founders and teams with a proven track record, that are targeting untapped big market opportunities. These companies differentiate themselves through innovation in technology or business models that have a clear value proposition.
Investment Process
What steps does the investment process follow?
Our investment process is structured and goes through the following steps:
- Initial Review: Every company that we come across (inbound or outbound) is first reviewed by one of our investment team members for an initial fit with our investment criteria. Our main focus is to understand if the company has an innovation through technology or business model with a clear value proposition for a clear potential customer. We also make sure that the company’s investment stage, operating sector, sales traction, and ESG/SDG alignment matches our investment thesis. For this step, we request your pitch deck.
- First Meeting: After clearing the initial review, one of our investment team members will meet with the founders either in person or through a video conference to discuss the opportunity. On many occasions, we ask the founder(s) to go over the pitch deck so as to get a first-hand experience regarding their business opportunity. It is fairly common during this step for us to ask for the monthly historical financials, key performance indicators, and financial projections. Since every company is different, we may ask for different things. Here is an example guide to preparing key resources for investors in a typical Series A financing round.
- Internal Review: Our team member(s) will discuss
the opportunity with the whole Dalus team during our weekly meeting. During the discussion, the team validates if the company differentiates itself through innovation and has a clear value proposition. The team member(s) analyzing the deal further validates the opportunity, which includes for example calls with subject matter experts and clients. - Pitch: If approved in the internal review, the founder(s) will present their pitch deck to the whole Dalus investment team. The opportunity will be further analyzed and will then be thoroughly discussed in our weekly investment team meetings, where a consensus decision is made.
- Term Sheet: After clearing the pitch and if approved by the investment team, a term sheet (a document setting forth the basic terms and conditions under which an investment can be made) is agreed upon and sent to the company.
- Due Diligence: After the term sheet is signed, and depending on the case, we normally proceed to perform a deep review of some aspects of the company (strategic, operational, tax & financial, and legal), which is commonly known as due diligence.
- Approval and Closing: Finally, our investment committee reviews the investment proposal, and once approved, the deal is finalized by drafting and signing formal legal documents.
How long does the investment process take?
The process usually takes between 2 to 3 months, but we strongly recommend companies to plan ahead and consider a typical fundraising process to last up to 6 months.
Partnering with Us
How does Dalus Capital add value to the companies it partners with?
We add value to our invested companies mainly in terms of strategy, governance, networking, and future financing.
In terms of strategy, we typically support companies with strategic planning, development, management, and even key talent sourcing. In addition to this, regarding governance, we also guide the institutionalization of its corporate governance. Furthermore, concerning networking, we are encouraged to introduce our portfolio companies to potential clients, suppliers, and strategic partners as well as to foster work relations with our investors. Also we support our company’s fundraising process for current as well as subsequent financing rounds, providing access to our extensive network of regional and global fund managers, as well as other sources of equity/debt financing that they may need.
Why should you partner with us instead of another fund?
Dalus Capital is composed of some of the most experienced early-stage investors in Latin America. We are recognized as pioneering leaders in Latin America’s venture capital ecosystem accompanied by a strong brand and team that supports us. Our two founding partners, Rogelio de los Santos and Diego Serebrisky have more than 50 years of collective personal experience in serial entrepreneurship and institutional investment management having done over 42 early-stage and growth investments.
We have a unique process we guide founders through, which we call GPS (Grilling, Polishing, and Scaling). This allows us to not only choose the founders with whom we commit but to identify the company’s core foundations and largest challenges, to help them make the best decisions going forward, as well as to attract the key resources needed to speed-up their scaling process. Partnered founders inside our portfolio are always open to share their working experience with our community of high achievers and future founders looking to partner with Dalus.
Furthermore, we are more than pleased to introduce our portfolio companies to a mix of investors that includes both institutional entities and family offices that gives the founders access to a key strategic network in Latin America and other connected regions.
Who backs Dalus?
We are backed by a diverse group of investors including pension funds, multilateral investors, funds of funds, family offices and high net worth individuals.
What is an ESG/SDG Policy?
Environment, Social and Governance (ESG) investing refers to criteria that allows measurement of the sustainability and social impact of an investment in a company. ESG analysis ranges from climate change emissions to human rights. An ESG Policy allows a company to follow certain guidelines that ensure its alignment with positive impact.
The Sustainable Development Goals (SDGs) were set in 2015 by the General Assembly of the United Nations and intended to be achieved by the year 2030. They are part of the UN Resolution and the 2030 Agenda and compose a collection of 17 interconnected goals with multiple targets and indicators to address the global challenges that we face. Goals range from tackling poverty and building strong justice institutions to protecting life on water, air and land. Promoting SDGs allows a company to create positive impact and work towards fulfilling the 2030 Agenda.