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Visa's Pismo buy brings hefty returns for investors

Jun 29, 2023

Illustration: Annelise Capossela/Axios

Credit card network Visa agreed to buy Pismo for $1 billion in cash Wednesday, marking a hefty return for investors of the Brazilian banking and payments startup, sources with knowledge of the matter tell Axios.

Why it matters: This is a sizable win at a rough time for fintech — and a small bright spot for the battered SoftBank venture portfolio.

By the numbers: Pismo was valued around $400 million in its last 2021 funding round, per the sources, indicating the Visa deal bumps the valuation by about 150% since then.

  • SoftBank Latin America Fund, Amazon and Accel led that $108 million round.
  • Earlier investors in the company include B3, Falabella Ventures and PruVen, Redpoint Ventures and Headline (which owns roughly 30% of the business).

Context: SoftBank's famous Vision Fund has posted record losses amid the recent tech slowdown.

  • That segment posted a loss of $30.6 billion for the year ending March 2023, as bets in companies including China's SenseTime, Indonesia's GoTo and WeWork struggled. Not to mention, Zume shut down this month.
  • Bets out of its Latin America fund were not immune, shedding about $2.8 billion.

Zooming in: Visa competitor Mastercard had been in talks with Pismo, the sources say.

  • Pismo, which performs both core banking and card issuing, enables banks and fintechs to launch financial products including wallets and lending. Most of its customers are in Latin America, though the company has been expanding into India and Europe.
  • Pismo's tech will also give Visa the ability to connect its clients to new and fast-growing payment rails like Pix in Brazil, the credit card company said in its press release.
  • Brazil and India have notably been among Visa's fastest-growing markets over the last five years, Visa's then-CFO Vasant Prabhu said at a Wolfe Fintech conference in March.

Of note: Pismo and Visa declined to comment.

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