Energy, infrastructure, AI… the forces that are transforming Latin America's private markets

From a resource base to a multisectoral opportunity

Commodities remain a fundamental pillar of Latin America’s economy. Mining, agriculture, and energy continue to attract private capital, particularly in countries like Brazil, Chile, and Peru, which have been supported by certain global dynamics such as sustained demand for critical minerals, food security, and other inputs linked to the energy transition.

These sectors offer a relevant degree of earnings visibility and downside protection based on assets—attributes highly valued by investors. However, the opportunity in private capital in Latin America is no longer defined solely by natural resources. What has changed is the breadth of sectors available for investment and the nature of value creation. Increasingly, it is oriented toward companies at the intersection of growing domestic demand, technological adoption, and operational inefficiencies—areas where active ownership can significantly transform outcomes. This shift reflects a broader recognition among investors that, while commodities continue to anchor the region, structural growth increasingly comes from services, technology, and infrastructure linked to productivity improvements—not just extraction.

Technology and fintech

Technology companies have established themselves as key drivers of private and venture capital in Latin America, with financial services at the center of this transformation.

The fintech sector stands out not only for its innovation but for being at the intersection of high unmet demand, rapid digital adoption, and scalable business models. For years, limited access to banking and credit held back consumption, business creation, and productivity. Today, that gap is closing rapidly: more than 70% of the population participates in the formal financial system, up from 50% in 2017, driven by the rise of digital wallets, neobanks, and alternative credit platforms. Smartphone penetration and internet access have enabled financial services to surpass traditional infrastructure, reducing costs, expanding coverage, and transforming distribution channels. From an investment perspective, this evolution is key. Many platforms are built on modern, cloud-native architectures, facilitating product iteration, data-driven origination, and cross-selling among payments, credit, savings, and insurance.

These factors improve profitability and operating leverage as they grow. Investment confirms this: information technology and financial services concentrate most of the venture capital in the region’s main markets. In 2025, IT led in Brazil, Chile, and Argentina, while financial services dominated in Mexico and Colombia, showing the breadth and depth of digital opportunities. Although consumer and health sectors continue to attract capital, the focus is on digital and financial platforms, which benefit from network effects, data usage, and high incremental margins. For private capital, this translates into greater interest in more established technology and fintech platforms, with robust customer bases, solid unit performance, and clear paths to profitability. Many operate in fragmented ecosystems, opening opportunities for consolidation, optimization, and regional expansion.

With stronger regulatory frameworks, deeper capital markets, and growing digital adoption, private capital is well positioned to lead the next generation of financial companies and drive productivity and economic transformation in Latin America.

Energy transition and infrastructure

Latin America is entering a decisive stage for energy and infrastructure, where its natural strengths and urgent needs shape a solid investment narrative. The region holds about half of the world’s lithium reserves, more than a third of copper and silver, and significant oil assets. It also stands out for its energy matrix: approximately 60% of electricity comes from renewable sources, thanks to abundant hydroelectric, solar, and wind energy. However, much of the energy infrastructure is obsolete, and transmission and distribution losses exceed those of more advanced markets. Many power grids were designed for a different context and now face challenges adapting to technologies such as distributed solar generation, battery storage, and electric vehicles.

Moreover, public monopolies and slow regulation often delay key investments needed to modernize infrastructure and unlock its potential. This gap between potential and reality is where the opportunity for investors arises. As cities grow and industries digitalize, the demand for modern and reliable infrastructure increases. In this scenario, private and international capital plays a fundamental role in closing the gap. Large-scale projects are already underway: the Vaca Muerta gas pipeline in Argentina, improvements in power grids and renewables in Colombia, and new gas infrastructure in Mexico and Guyana. International partners are also key.

In 2025, the Japanese agency JICA committed one billion dollars to BID Invest to boost private investment and reduce the financing gap for sustainable development in the region. These efforts go beyond building new assets: they aim to lay the foundation for the next stage of growth and innovation. With the energy transition accelerating, private capital and infrastructure funds are well positioned to lead Latin America’s transformation and turn its natural advantages into sustainable economic progress.

Understanding the risks behind the opportunity

An expanding range of opportunities does not necessarily mean a homogeneous landscape, especially in a region as diverse as Latin America. Although themes like digitalization, infrastructure, and financial inclusion are common in many countries, the conditions for investing in private capital vary considerably. Political and regulatory frameworks, tax regimes, and capital mobility rules differ substantially, and currency volatility remains a constant in the region.

These factors impact transaction structuring, financing decisions, and exit alternatives, explaining the divergence of results among countries, sectors, and investor groups. For investors, harnessing the long-term potential of private markets in Latin America requires more than identifying attractive trends: it demands effective navigation of a complex and heterogeneous operating environment. Return dispersion is high and amplified by differences in origination networks, analytical discipline, and post-investment operational capabilities. In this context, selecting managers with strong local networks, access to exclusive opportunities, and a proven track record of operational value creation is key. Those with active and long-standing presence in the region are better positioned to structure defensive transactions, manage risks, and drive concrete improvements in portfolio companies. In practice, the manager to whom capital is allocated can be as decisive as the sector or theme chosen.