Investing in Akua: Revolutionizing Payment Processing in Colombia and Spanish-Speaking LatAm
We’re proud to announce our investment in Akua, our first in Colombia. Akua is building a next-generation processing platform for merchant acquirers, starting in Colombia with ambitions to expand across Spanish-speaking Latin America. The team is capitalizing on an opportunity created by Colombia’s central bank in 2022 when they passed regulations that would open up the acquiring market to new entrants and foster more competition and innovation. (See today's coverage in Axios.)
The acquiring processing market in Latin America generates up to $10 billion in annual revenues, including transaction fees, service charges, and value-added services. However, Colombia is challenged by legacy processing systems and two incumbent operators with 80% market share. Many of these systems are bogged down by outdated technologies, resulting in higher costs, slower transaction speeds, and a general lack of flexibility to adapt to digital payments and new payment forms. In addition, the dominance of legacy systems has stifled innovation, leaving merchant acquirers in Colombia and comparable markets needing an efficient means to cater to an increasingly digital-savvy customer base.
Architecting a Modern Platform
Inspired by an era of payments market innovation in Brazil that began a decade ago, the Akua team sees the same potential now in Colombia and other Latin American countries. Akua is building a full-stack processing platform for merchant acquirers in Colombia, building on the base of acquiring processing on credit card rails to include the suite of accompanying services and extending to newer forms of digital payments including BNPL and cryptocurrency.
Akua’s team is building a cloud-native architecture that promises modern-day scalability and flexibility. This infrastructure facilitates direct cloud connections with Visa and Mastercard, ensuring lower latency and higher efficiency in transaction processing. Akua also leverages AI to enhance operations, reduce costs, and improve platform efficiency, promising to deliver at least a 10x speed advantage over its competitors.
Akua provides a suite of services—from direct cloud connections to Visa and Mastercard, transaction processing, and an API gateway for accepting transactions to settlement and clearing processes—as an enabler for payment facilitators, gateways/processors, orchestrators, and large merchants. This approach allows these entities to improve transaction reliability, reduce fraud, and streamline operations.
The Right Team with a Strong Founder-Market Fit
We were introduced to Akua through the founder of one of our portfolio companies. We were immediately impressed by the founding team’s distinctive composition, extensive expertise in paytech, and deep regional experience. Carlos Marín (CEO), Juan José Behrend (CTO), and Rodrigo Rodrigues (COO) bring a wealth of knowledge from their overlapping careers in the payments industry, having held key roles at established companies such as Mastercard and PayU, as well as in leading regional fintech innovators such as dLocal, Jeeves, and Pomelo.
At Flourish, we firmly believe that open, low-cost infrastructure fuels competitive markets, driving innovation and benefiting consumers. We are excited to have Akua join our portfolio of innovators building next-generation payments infrastructure across the globe. Our investment in Akua is driven by a belief in its potential to transform the payments industry in Colombia and Spanish-speaking LatAm. With a strong team and a clear vision, Akua is set to build a scalable solution that redefines efficiency, speed, and flexibility in digital payments.