Brazil’s SoftBank-backed fintech unicorn Creditas has just published its earnings report for the fourth quarter and the whole year of 2021. Eyeing an IPO, the company posted a net loss of BRL 137.6 million (141% more than a year before) and BRL 322.4 million in revenues (a 27% increase compared to last year’s third quarter and more than double of the results registered in the fourth quarter of 2020, in the middle of the COVID-19 pandemic).
The result is due to the Latin American fintech’s aggressive reinvestment policy that, it seems, is starting to pay off.
The net loss reported now accounts for 43% of the fintech’s revenue; in 2020 the same metric represented 55% of the company’s revenue. “We continue gaining scale to cover the cost of developing our technology and growing our portfolio,” wrote the company.
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In 2021 as a whole, Creditas reached BRL 870 million in revenues, a 159% annual growth, and “the fintech’s fastest growth since 2018”, when it had less than a tenth of its current size.
At the same time, the startup reported a credit origination (loans and insurances) of just over BRL 1 billion, which means a 198% increase in the portfolio, raising the current volume of new loans granted and insurance premiums issued by the fintech to BRL 3.7 billion.
In the statement to investors, Creditas said that all its three ecosystems (loans that use vehicles, real state properties, and salary as collateral) “performed at record levels”, showing “significant progress” of cross-selling operations.
In January, Creditas reached a valuation of $4.8 billion in a new funding round. As explained by CEO and founder Sergio Furio at the time, Creditas decided to raise more capital to safeguard its growth this year and the next, as uncertainty mounts for tech companies amid concerns that the U.S. Federal Reserve will become aggressive in controlling inflation. Brazil’s stuttering recovery is even more at risk now with the yet unclear consequences of Russia’s invasion of Ukraine.
Furio has said a few times that he does not intend to open digital accounts or expand the business in such a way as to become a neobank. For him, the challenge of providing cheap and fast credit is already huge in Latin America, and solving this problem is already quite a business. Even so, over the past year, Creditas announced an investment of BRL 95 million in the Brazilian manufacturer of electric motorcycles, Voltz. According to him, this investment is due to the fact that, in the future, Creditas wants to see its portfolio linked to the new, that is, not tied to combustion vehicles.
