Fluent Ventures backs replicated startup models in emerging markets

Summary

A new venture firm aims to prove that the most successful startup ideas don’t have to be born or scaled in Silicon Valley. Fluent Ventures, a global early-stage fund, is backing founders replicating proven business models from Western markets in fintech, digital health, and commerce across emerging markets. The more cynical might describe this as a clone factory, but founder and managing partner Alexandre Lazarow calls the firm’s strategy “geographic alpha.” Fluent’s premise is that many of the world’s most valuable startups are not entirely new concepts that haven’t been tried before, but more simply, local adaptations of models that have already succeeded elsewhere. The San Francisco-based firm, founded in 2023, is deploying $40 million across a fund, an incubator, and a structured co-investment vehicle with limited partners. It is writing initial checks of $250,000 to $2 million, from pre-seed to Series A, and plans to make 22-25 investments, with follow-ons. “We are contrarians at heart,” said Lazarow, who previously invested at Omidyar Network and Cathay Innovation. “We believe the world’s best innovations are not the exclusive purview of Silicon Valley.” Fluent is not exactly working in a bubble: The last decade has seen a massive decentralization in the technology industry. In 2013, just four cities had produced a unicorn. Today, that number exceeds 150. And that has been on the back of rinse and repeat, with many of the top tech players in emerging markets mirroring successful startups that have been built elsewhere, such as Amazon clones in e-commerce, Stripe clones in payments, and neo-banking apps in fintech. The first breakout neo-bank was Tinkoff from Russia. “That movement scaled globally, and [it] was one of the insights that motivated my investments in Chime in the U.S. and Banco Neon in Brazil,” said Lazarow. Lazarow insists Fluent doesn’t just copy-paste. “That rarely works, in our opinion. Local adaptation is critical,” he said. The firm points to...