Cauris is a mission-driven debt fund with a focus on financing the very best Fintechs in the Global South. We’re leveraging the power of DeFi to support Fintechs that are increasing access to financial services for the traditionally underbanked.
It feels very special: we are all part of a movement building new systems to broaden access to financing. This benefits not only exciting, high-quality Fintechs, but also their end customers—consumers and small businesses who gain access to life-changing financial services.
As Q2’ 2022 drew to a close, we had a chance to reflect on two topics that are top of mind: the state of Fintech and our experience working with DeFi credit protocols.
On the one hand, Q2 ushered in a wave of optimism. As we visited both current and potential customers, we identified a consistently positive trend: our Fintech partners had used the hardships introduced by the global pandemic to strengthen their underwriting. They had improved lending policies and practices, fortified risk models and decreased delinquency and default rates. Consequently, loan portfolios—on whole—were stronger than they were pre-pandemic.
Our partners continue to scale services and to deliver results. We personally find it rewarding to see the financial inclusion impact each Fintech is achieving, such as enabling neighborhood store owners in Mexico access the capital they need to grow their businesses.
Consequently, Fintech remains an extremely sound investment opportunity. In fact, in many markets, Fintechs are innovating and out-competing traditional financial providers to meet the needs of a growing global middle class and to fuel economic growth.
But Q2 also introduced volatility into TradFi and DeFi markets. Yet from our perspective, conditions only reinforce DeFi credit protocols’ value proposition and Cauris’s investment thesis.
DeFi credit protocols provides a platform that efficiently connects capital to businesses with historically low access to capital. Cauris provides DeFi investors with opportunities to access high risk-adjusted yields that are sheltered from crypto’s volatility because they are underpinned by quality, real-world, productive assets. It’s a great partnership with a clear use case and real utility.
So what are we seeing just a few weeks into a new quarter?
Our portfolio companies remain robust, underpinned by strong fundamentals, proven business models and large addressable markets. Our Fintech pipeline is growing in every corner of the globe. Our partnership with the Centrifuge Community—for which we’re grateful—is strong.
Consequently, we remain bullish on Fintech as an investment class and DeFi credit protocols as ideal conduits to help close the global Fintech financing gap and to extend financial access and agency across the Global South.
We appreciate your continued support. Please see below for our Q2’22 investor update.
