Following a strategic split at Upload Ventures, former managing partner Carlos Simonsen has launched Upstream, a new asset management firm targeting growth-stage companies. The new venture is distinguished by its innovative hybrid investment model, which combines both equity and credit instruments to offer more flexible capital solutions. This unique approach is designed to address a specific need in the market for promising companies seeking to scale their operations without facing immediate shareholder dilution.
A New Chapter After Upload Ventures
The dissolution of Upload Ventures has strategically resulted in the creation of three independent and highly specialized firms, allowing each founding partner to deepen their respective focus. Rodrigo Baer now leads 14B, which is dedicated to early-stage startups, while Mario Moraes heads UVP to manage a growth fund anchored by corporate partner TIM. Simonsen, along with the entire former growth team, established Upstream to pioneer a new vertical of financial products that move beyond traditional venture capital frameworks.
An Innovative Hybrid Financing Model
Upstream is moving beyond conventional financing by championing a hybrid investment thesis that artfully blends the benefits of equity and credit. This model provides shorter-term capital injections that include an equity upside, specifically designed for companies needing to accelerate growth without the immediate dilution of a pure equity round. The firm aims to build long-term, supportive relationships and offer a vital alternative to traditional bank financing, which often relies on metrics unsuitable for innovative startups.
Responding to a Competitive Market
This forward-thinking strategy directly responds to a shifting landscape where intense competition for top-tier equity deals in Latin America has significantly narrowed the funnel for exceptional opportunities. Simonsen notes that while the top five percent of companies remain strong, Upstream aims to focus its pure equity investments on the absolute top one percent. The hybrid model, therefore, addresses a critical market gap by providing capital to a wider set of high-quality, scalable businesses that need a different kind of fuel.
The Role of AI and Future Focus
While the firm's core is its hybrid model, pure equity investments remain a priority, especially in the transformative field of artificial intelligence. Simonsen views AI not just as an investment thesis but as a fundamental tool for enhancing operational efficiency across the board. Internally, Upstream already leverages AI to significantly boost productivity in its due diligence processes, allowing the team to analyze opportunities more deeply and quickly than before.
Outlook and Fundraising Plans
Looking ahead, Upstream is currently validating its innovative model through a series of pilot projects before launching a new, dedicated fund targeted for 2026. The firm’s initial geographic focus will be on the Brazilian market, seeking companies with validated products and a clear need for capital to scale their operations. Simonsen remains optimistic, believing that an expected decline in global interest rates will create a more favorable investment environment for quality companies ready for growth.
The official launch of Upstream marks a significant and timely development in the Latin American venture capital ecosystem, reflecting a growing demand for more sophisticated and adaptable financing structures. By offering a flexible hybrid of equity and credit, Carlos Simonsen's new firm is well-positioned to support a new generation of growth-stage companies on their path to success. This innovative approach provides a crucial pathway for startups to scale efficiently within an increasingly complex and competitive global market.
Source: Startups.br.com