Fynsa
Capitalizarme is a real estate investment marketplace and a leader in the Chilean market that aims to become a unicorn—that is, a startup valued at over USD 1,000 million.
This week, FYNSA launched its Venture Capital II Investment Fund, a fund structured—initially—for a three-year term that will invest in a significant stake in Capitalizarme, with the expectation that the company’s Series A round will appreciate in value. The initial objective is to support the startup in achieving its most immediate goal: expanding into Mexico and then becoming the leader in the Latin American market.
In 2014, business engineer Gabriel Cid founded this platform, which uses advanced technology to select the best investment opportunities on the market and simplifies the process so that small investors can make responsible investments. Currently, the company has more than 5,000 investors and 10 million UF in real estate investments.
One of the co-founders of this marketplace is Paolo Colonnello, who currently serves as CPO (Chief Product Officer) and chairman of the company’s board of directors. Passionate about technology and the growth of startups, he is also a mentor at Startup Chile and has been involved in other initiatives related to the world of entrepreneurship and venture capital.
Cornershop, Levita Magnetics, and Colektia are successful companies he has advised and invested in. For 18 years, he was also the co-founder and CEO of Blue Company, a startup incubator focused on technology that has worked with both the public and private sectors.
Colonnello likes to approach things with a strategic vision and a focus on objectives, taking a fully “investor-centric” approach, with a clear emphasis on ease and transparency. We spoke with him about his views on investing and entrepreneurship, the Proptech industry in general, and the present and future of Capitalizarme.
What factors do you consider when making your investment decisions?
First and foremost, the team—because businesses change, and you need a team that can adapt, learn, and know when to ask for help when it can’t solve problems or adapt on its own. Second, the industry must be large enough to support different players with different solutions. Third, the business model: how value is created, who is willing to pay for that value, and what that will look like in 5 or 10 years. Startups are driven by technology, which is what allows them to grow exponentially, and technology is driven by Moore’s Law, which states that the cost of technology halves every 18 months. So the question is: Will this still be possible in another 5 or 10 years?
When it comes to local entrepreneurship, how do you see the outlook in Chile and Latin America for the coming years?
I see it as a mature market:we have a $3.5 trillion success story over five years—Cornershop—we have NotCo backed by Jeff Bezos, and startups in Series A, B, and C rounds funded by SoftBank, Sequoia, or Tiger. We’re already reaping the rewards of what Startup Chile and local funds and angel investors sowed years ago. Today, local startups have a real opportunity to achieve major exits—and these aren’t just pipe dreams like they were 5 or 10 years ago.
Capitalizarme operates under the motto “Invest simply and quickly” because it is a Proptech company—that is, it uses new technologies applied to the real estate sector. According to Colonnello, this is an industry whose popularity is on the rise.
Why have Proptech companies become an attractive industry for investors?
It is one of the few investments that allow the average investor to use leverage, which is very attractive. Furthermore, it provides a hedge against inflation and generates both cash flow (in the form of rental income) and capital appreciation.
How big is the Proptech market, and how advanced is it?
The real estate industry is massive, worth about 300 trillion dollars worldwide and about 20 trillion in Latin America. About 15–20% of that is for investment. Proptech companies are small by comparison, but they are growing rapidly and disruptively, quickly rendering traditional players obsolete. It is currently one of the industries with the highest growth and the most opportunities.
How scalable are these products to the rest of Latin America and the world?
A lot. The real estate industry—especially the investment side—follows similar principles everywhere. It is in emerging markets where we see the most opportunities, due to the lack of information and the expected growth in property values, compared to established markets. But the logic behind buying, taking out a mortgage, renting, or selling is similar everywhere.
It is in this context that Capitalizarme has achieved unprecedented success. Since 2019, the real estate investment marketplace has sold more than 4,200 properties and has accumulated US$520 million in GMV and US$24 million in revenue.
How did the idea to create Capitalizarme come about?
Capitalizarme was founded by my business partner, Gabriel Cid, through bootstrapping (starting a business using only the resources at hand, with little to no capital) and by selling investment opportunities that real estate agencies offered to his friends and acquaintances. It grew little by little, and a couple of years ago, he realized that the opportunity was greater than he had initially thought, so with the onset of the pandemic, he began selling apartments online. That’s when he invited Luis Fuentes and me to join the project and turn Capitalizarme into a multi-asset, multi-country marketplace.
What advantage does it have over the traditional market?
The traditional market is not very tech-driven. We streamline the process and turn a property (apartment, warehouse, land, etc.) into an investment asset, providing specific information on returns, risks, mortgages, leases, and more. The traditional market is also entirely focused on housing, not on investment, and that’s where we really stand out.
What are your next goals?
Today we’re focused on Mexico; entering a new country is quite a challenge—we need to understand what we need to adapt, what new opportunities exist, and how to take advantage of them. We can only achieve that through action: by being there with our customers, understanding their needs and their way of thinking. We’re also building a range of financial services, such as secured leasing, paying the down payment on mortgages in installments, and—coming soon—commission payments for real estate agents and brokers. Aleix Radmilovic is leading this effort; he comes from a background of managing $6 trillion in real estate assets in the institutional sector and is truly a genius when it comes to building our Fintech layer.
Tomás Latorre, AGF Team
