With a strategic focus on 2028, the firm aims to promote more than 250,000 small businesses and launch two new startups annually.
Addressing social problems such as inequality, unemployment and environmental deterioration through entrepreneurship is not only positive to improve the quality of Latin Americans, but also requires investments that are profitable in the medium term.
This is the case of Fundamental, a venture studio or startup factory with a socio-environmental purpose. Last month, Fundamental obtained significant financial support after receiving an investment of US$ 7.7 million and collaboration with allies such as Elea, Julius Baer Foundation, Visa and other foundations and investors from Europe and the United States. The capital will be key to its consolidation in Mexico and to execute its strategic plan for 2028, which proposes the promotion of more than 250,000 small businesses and the launching of two new startups per year.
“We work with companies that are in the informal and traditional economy (corner stores, beauty salons, agricultural producers and more),” Corentin Larue, co-founder and managing director of Fundamental told AméricaEconomía. “We are in Peru, Guatemala, Colombia and Mexico.”
According to data from the Global Impact Investing Network (GIIN), impact investment in the world reached a historical maximum of US$ 1 trillion in 2022. However, the region accounted for only 1% for this type of projects. Fundamental aims to innovate this market through a unique model that eliminates the gaps inherent to entrepreneurship in the early stages, thus offering social businesses—those with a purpose and profitable economic model—a methodology that allows them to develop more efficiently (up to four times cheaper) and an extended technology, finance and human resources team.
“They are expected to reach profitability within a three-year horizon,” Larue said.
Startups created through venture studios have a higher success rate (34%), also according to GIIN .
As Fundamental points out, challenges arise during the first three years from the start of the startup . The main obstacle lies in access to financing, since depending solely on personal savings or contributions from friends and family restricts the possibility of the middle or lower classes being able to start a business. The second are entrepreneurs who do not follow a design thinking process, so they do not check whether their hypotheses about the business idea are viable.
“The process to reach Product Market Fit, which is the milestone moment in which you know that your product has a market, takes a long time and there are times where there is no process to do it in a faster or orderly manner,” Larue explains. “We provide financing and offer a framework .”
Fundamental focuses on three areas: employability and education, opportunities in the food chain, and circular and green economy. The first seeks to answer the question “how can our ventures create employment and offer education for adults and workforces?”, while the second wants to resolve the deficiencies that affect millions of micro and small business producers. And finally, the solution to the first is evident in the third:
“We École, a company that buys from small producers in Mexico to promote local and healthy consumption of snacks. In Colombia, we have an education application for older adults with a TikTok format that seeks to help them adapt to new habits. There is also a company that includes informal recyclers who are in extreme poverty as suppliers of recycled plastic. And in Guatemala there is another that sells products and services to women who own beauty salons,” Fundamental's managing director said.
Likewise, it offers virtual training to micro business owners who are in the value chain of large companies in the mass consumption sector, such as Nestlé.
“As we have sufficient traction and have proven that we know how to create companies that have impact, are profitable and scalable, we will be considering the possibility of creating a fund,” said its co-founder, Corentin Larue, about his perspectives on the future of Fundamental. "Today our objective is to continue raising financing, which we describe as catalytic, to create those 10 companies in five years that would be added to the four we already have."
Having started operations in 2023 and founded by Elfid Torres, Corentin Larue, Maxime Braun and Omar Álvarez in collaboration with FUNDES—an international organization that promotes the competitive development of MSMEs in Latin America. By the end of this year, he hopes that his edtech in Mexico, Simón, which aims to train allies (suppliers, customers, franchisees, retailers) and key partners of companies through educational content in TikTok-style microcapsule format, will complete the financing round with institutional funds.
