9 Startups Focused on the Development of Children and Teenagers That Attract Investment in Latin America

Meet the companies that are improving living conditions for childhood and adolescence with technology and innovation, and that have received investment from regional venture capital funds

Latin America is one of the most unequal regions in the world, and the numbers show it. More than 12 million children and teenagers do not have access to education, according to Unicef data. This is one of the problems that make children’s development in the region harder, and it has caught the eye of venture capital in Latin America.

Investment funds have focused on companies that contribute to the wellbeing of children and teenagers, especially EdTech startups that make educational resources easier to access, improve the quality of learning and guide parents in their children’s upbringing.

In this way, education has become an attractive sector for venture capital funds in Latin America, because of the size of the market and the needs that exist in the population.

Investment in EdTech startups is rising. In 2021 alone, EdTech broke the investment record with 299 million USD, almost four times more than was raised in 2020, according to Holon IQ figures.

Investment in Latin American startups is growing

In Latin America, educational inclusion is not the only challenge facing the children’s market. There are other problems such as poverty, obesity, malnutrition and bullying that entrepreneurs are addressing with innovative technology-based solutions.

They even help foster the development of STEAM skills, financial education, and the emotional, physical and mental development of both children and teenagers.

These types of startups fall into different categories such as HealthTech, FinTech, FoodTech, FamTech or EdTech, all sectors that are relevant to private equity funds.

For example, in 2020 investment in HealthTech grew 5 times more than in 2019, totaling 99 million USD invested in Latin American startups, according to Pitchbook data.

FamTech, companies that make parenting and parents’ family life easier through technology, is another sector gaining momentum with private investment.

According to Crunchbase data, 500 million USD have been invested in this type of company worldwide since 2013.

Among the most active funds in Latin America that have invested in companies that look after children’s wellbeing are ALLVP, Wayra, Endeavor Catalyst, Dila Capital, 500 Startups, Ignia and Kaszek, among others.

In fact, Unicef has also invested in this type of early-stage startup since 2016 through its own fund, Unicef Ventures. To date, it has invested more than 10 million USD in 126 cutting-edge technology solutions.

Winning investment bets

The children’s and youth market is a very broad sector that still has many opportunities available for new technology ventures. In this sense, there are startups that in recent years have managed to get funding and make their way in the industry. Here are 9 of them and their success stories:

1. Kinedu

This is a platform that gives educational resources and tools such as videos and games to parents, educators and preschools to boost the upbringing of children in early childhood. More than 8 million families use this technology.

It was founded by Mexican Luis Garza Sada in 2013 and currently operates in Mexico and Brazil under a freemium business model with subscription plans.

Kinedu uses algorithms and machine learning to provide personalized educational plans and activities. To date it has raised 16 million USD through investment funds such as Endeavor Catalyst, Ignia, 500 Startups, Dila Capital, Stella Maris Partners and Social Capital from Promotora Social México.

In 2021 it received the Tecnos Award given by the government of Nuevo León in Mexico, and it is backed by Harvard’s Center on the Developing Child.

2. Storybook

This is an app that offers parents bedtime stories, songs and massage techniques to combat children’s sleep disorders and so encourage their development.

Daniela Vega and Francisco Cornejo are the creators of this Ecuadorian company, which gained more than a million users in 60 countries in its four years on the market. Both are part of the global community of high-impact entrepreneurs created by Endeavor.

The company has raised three investment rounds totaling 2.9 million USD, which involved several Silicon Valley funds and the well-known American investor Jason Calacanis.

3. BabySparks

Colombians Gustavo Rodríguez and Juan Pablo Mejía founded this company with the purpose of supporting parents in their children’s development. It is a platform that offers virtual parenting classes for children in early childhood from 0 to 36 months, as well as a catalog of activities personalized with the help of technology according to each child’s needs.

This company operates on a subscription business model with which Gustavo and Juan have earned the trust of more than seven million parents around the world. In total they have raised 3.8 million USD in different investment rounds with the support of funds such as Lat VC, Miami Angels, Verve Capital and K50 Ventures.

4. Yana

A HealthTech company of Mexican origin that provides specialized care to fight depression, anxiety and low self-esteem through a virtual assistant.

The platform is aimed at teenagers, young people and adults who suffer from any of these emotional disorders. It was founded by Andrea Campos in 2016 and today has more than 5 million users.

In 2020, the “App Store” distinguished this app as a life-saving tool, and after the recognition, the platform reached one million downloads. To date it has raised more than 1.5 million USD from venture capital firms such as 500 Startups, Magma Partners and ALLVP.

5. Beereaders

This app helps improve reading comprehension in primary and secondary school children through a game experience. It can even be used without an internet connection once installed, since the content stays preloaded at all times.

So far it has benefited more than 70 thousand students in Chile, Mexico, Peru and the United States, the countries where it currently operates.

Luis Gringras and Ruben Arias brought Beereaders to life at the end of 2019 in their native Chile. In 2020 it was chosen as one of the 10 best educational technology companies at the ASU-GSV Cup.

The company’s growth also gained momentum with investment from University Venture Fund, New Age Capital and Ewa Capital, among other funds that have invested a total of 4.2 million USD.

6. Crack the Code

This is an educational technology company founded by María Veléz in 2017, specialized in Spanish-language programming classes for children and teenagers from 5 to 18 years old.

For now the platform lets parents sign up for this service through a subscription, although the company plans to implement a B2B business model. It currently operates in Mexico, Colombia and Peru, and has 1,300 active students in more than 22 countries.

Thanks to this technology solution, Crack the Code raised a 2.7 million USD investment round led by the venture capital fund Kaszek. It is the first company of Peruvian origin to be part of this investment firm’s portfolio.

7. Papumba

Papumba supports families in children’s education, through a platform with children’s games that help improve the quality of learning, reading, numbers and soft skills.

The solution is designed for children from 2 to 7 years old and includes content in 18 languages adapted to the culture of different countries. Parents have unlimited access through a freemium payment scheme.

The EdTech was founded in 2017 by Argentines Pablo Capurro, Santiago Capurro and Gonzalo Rodríguez, who raised a seed round of 2 million USD. Among its investors are funds such as Wayra and Mana Ventures.

So far they have more than 15 million downloads in Latin America, Europe, China and the United States. The company won Kidscreen Awards and Mom Choice Awards and was a global finalist at G-Startup Worldwide.

8. Egg

This company’s solution lets teachers, tutors, coaches and principals of primary, secondary and higher education schools form high-performing teams.

To achieve this, Carolina Pérez and Ignacio Gómez, from Argentina, developed a platform that analyzes students’ interactions and strengths in their daily life at school. This makes it possible to choose the members of each team strategically, to improve the quality of learning.

More than 15 thousand students use this platform, which attracted investment from funds such as Kaszek, DraperCygnus, Alaya Capital, and from Roby Souviron, founder of the travel company Despegar. Together they have injected 2 million USD in three rounds of capital.

With this solution, Ignacio and Carolina won the Scale Up to UK program to start operations in the United Kingdom, run by Wayra and the British government.

9. Theia

Caring for women during pregnancy is the focus of this Brazilian company, founded by Flavia Deutsch and Paula Crespi in 2019.

They developed a platform that provides informational content and access to medical care with psychologists, doctors, nurses and other health professionals who give support during pregnancy, breastfeeding, nutrition, health and the development of babies, children and mothers.

Its app also lets users keep a precise record of the medical appointments they need to attend. It operates under a business model based on the B2C (Business to Consumer) scheme, although it acts as an intermediary that connects pregnant women with health professionals.

To date this company has raised more than 8 million USD in different investment rounds led by funds such as Kaszek, Maya Capital, 8VC and Canaan Partners.

Venture capital, key for childtech startups

The 9 startups you have just met are a clear example that entrepreneurs play an important role in solving the problems faced by children and teenagers in Latin America.

They also show the interest investment funds have in this type of innovation, and the importance of building synergies with different stakeholders in the entrepreneurial ecosystem to leverage startup growth.

If you want to expand to Mexico and your startup creates an impact on childhood and youth.

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