Lemon Cash wants a crypto revolution and Valor just joined it!

July 27, 2021

We are excited to announce our Series A investment in Lemon Cash, an Argentinian startup whose mission is to make crypto cool and usable in Latin America. The investment is part of a $16.3M round, one of the largest Series A in Argentina, led by Kingsway Capital with the participation of Coinbase Ventures and other investors.

In simple terms, Lemon Cash offers blockchain powered financial services. Lemon’s main product is a crypto wallet that allow users to: (i) Send and receive money between Lemon Cash wallets; (ii) Send and receive payments through a link, QR code or credit and debit cards; (iii) Buy, hold and sell crypto assets (e.g. Bitcoin, Ethereum, etc).

Let’s us share some of the key points of our investment thesis:

Impressive traction: in less than a year the company has created the second largest crypto community in Argentina, obtained >20 thousand users, acquired >700 merchants, overcame multiple regulatory challenges to put the company into the works, issued the first crypto card in Argentina, with a 60 thousand waiting list and virtually created a crypto digital bank.

Crypto team: Lemon has a strong technical team, with an agile mindset that hustles their way through problems and challenges. E.g. The Lemon team got 700 merchants to accept the Lemon Cash payment solution by going store by store in San Martin de Los Andes, a small city with a population of 31 thousand that served as test ground for their payment solution. They move fast, are super ambitious and are the type of entrepreneur we like to back.

Product: Lemon has developed products and features we have not seen even in other global markets companies. E.g. Automatic interest payments on crypto balance with weekly liquidity and APR of 3.5% on BTC, 4% on ETH and 7% on dollar stablecoins. To be able to get a 7% dollar-denominated return in Argentina is as good of a product-market-fit as it gets.

Ecosystem approach: with the success of companies such as MercadoLibre and Rappi, we have come to believe the Chinese ecosystem approach (e.g. Alibaba, Tencent) works well in Latin America. Lemon’s founders are not shy about their ambition, they want to be the dominating player in the Latin American crypto scene and offer a full suite of products, which leads us to our next point.

The most impressive crypto product roadmap we have seen in Latin America: Lemon has an exciting product roadmap ahead which includes:
Lemon Card: Argentina’s first crypto credit card, with a cashback in BTC.
POS: hardware to accept crypto payments.
Crypto collateralized loans: users will be able to get loans using their crypto as collateral.

When we add the product roadmap to the existing wallet, payment solution and savings account, we get the full picture: Lemon is turning into a full stack banking solution. Lemon is literally the 1st company in the region to provide every single one of the major financial services value propositions.

Argentina is a great test ground for a crypto services: last month the country was removed from multiple indexes by MSCI and considered to be a “stand-alone” economy, which is lower than Emerging or Frontier market. In other words, the country became not worth considering at all by the MSCI, which translates to harsher conditions to have access to international financing and enhances the economical isolation of the country. However, in parallel to this, Argentinians face challenges to access dollars, send and receive strong currency in the country. Crypto brings a range of solutions which may help address some of these challenges.

Typical Valor Cross-Border investment: although Argentina is a key market, at some moment to win in Latam a startup must enter Brazil. To help tier-1 teams to enter Brazil has been at the core of our cross-border investments. As Lemon Cash’s CEO, Marcelo Cavazzoli, said: “Valor Capital Group’s addition to our investor ranks is a symbol that Lemon’s regional expansion is imminent. Having Valor’s vision, input and experience in a market as full of opportunities as the Brazilian market will accelerate us to reach our goal in record time: to bring usability to cryptocurrencies throughout Latin America.”

We are super excited about what the Lemon team will do first in Argentina and later in the rest of Latin America. Lemon Cash wants to start a crypto revolution..and Valor has just joined it!