Why Latitud invested and doubled down on Cometa, empowering LatAm schools with tech

This is part of our "why we invested in" series of posts – a glimpse into what we look for when writing the first check for LatAm founders building good sh*t. As investors and journey partners, we hope this series will inform and inspire other early startup creators in the region.

We’ve been deploying first checks for some years now. That means we  see portfolio companies presenting enough traction to spell out their ABCs (and even exit!).

At times like these, we love to double down whenever we can.
And that’s exactly what happened with Cometa. ☄️

In 2022, Latitud was one of the first investors to bet in the education meets software meets fintech startup, joining the seed round led by the powerhouse duo Kaszek and Reach Capital.

Cometa now raised its Series A – and we were super into doubling down and once again joining their round. Why were we so convinced?

‍(Psst, spoiler: a lot to love here.)

TL;DR: investment overview

🏫 The market: There’s a growing demand for private education across Latin America. Yet tuition represents a good crunch of a families’ budgets, and for tutors, managing these payments can be challenging (especially in economic downturns). On the other hand, schools live with manual, time-consuming processes for collection. The end result? High delinquency rates.

🔢 The startup: Cometa is all about transforming how K12 private schools in Mexico manage their finances. Through their blend of Vertical SaaS and Fintech, schools streamline payment collection, unlock cash flow, and improve student enrollment — all essential pieces for running a competitive and financially sustainable educational institution. Cometa proved its traction by conquering 300+ schools in less than two years.

💰 The round: We invested in Cometa’s seed and Series A rounds. What stood out to us the most was the state and potential of this sizable market; Cometa’s strong solution and traction; and the execution capacity of its founding team.

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Teaching efficiency to LatAm private schools

Education is a massive sector everywhere you look. Concerned with the quality of public education, more families are turning to private schools across Latin America. Brazil leads the region, with 24% of students attending private K12 schools. Countries such as Chile, Colombia, and Argentina also see growth. Although a sizable market due to the size of its population, Mexico still has a lot of untapped potential in this space: only 10% of students attend private K12 schools.

Yet private schools across the region face operational challenges that have a clear impact on their bottom line. They run on manual and time-consuming processes, such as emitting (and re-emitting) invoices and receiving fragmented payments with unclear identification.

If Cometa handles that problem for just 2% of the Latin American market, or 10% of Mexico’s K12 and university sectors, the startup can reach $50M in addressed market.

Mexican schools see high delinquency rates that can get to a staggering 34%. Cometa already provides a 52% reduction in these past-due payment portfolios.

Cometa’s breakthrough solution and expansion

1. Cometa’s solution

Cometa is the operational ally that private schools were lacking, working on both reducing losses and boosting revenue. The platform for financial management now helps schools to:

🤖 Automate tuition collection. Reminders and payments to tutors, invoicing and reporting for schools: everything is automated to save time, reduce friction, and lower delinquency in the long run.

🤝 Manage enrollment. Streamlined re-enrollment and admissions processes help schools retain students more efficiently.

🛒 Build digital storefronts. Schools can set up online stores to sell supplies, uniforms, and other items, generating additional revenue through the same platform.

This is just the beginning: there’s a huge potential to layer on more products and services down the line (more in “Future: Why we’re excited”).

2. Cometa’s monetization

Cometa has that blend between VSaaS and Fintech that we love to see here at Latitud: conquering a vertical by solving its most pressing pains.

Through a mix of managerial and financial products, Cometa acquired a control point – and is now well-positioned to improve retention and revenue every time it layers a new feature. The startup’s monetization reflects its software and financial services mix, with a blend of monthly subscriptions and payment take-rates.

3. Cometa’s ICPs

Cometa is strategically focusing on a mix of ideal customer profiles that can bring revenue both in the short and the long term:

👪 Family-run schools (~300 students): These are often run by single decision-makers, making it easier to close deals once Cometa reaches the right person.

🏫 Large schools (1,000+ students): Here, decision-making goes through boards. It’s a longer process that brings larger contracts.

💡 New customer profiles: Cometa also recently unlocked new segments, such as religious congregations and school groups, which can lead to multi-school deals over time.

4. Cometa’s traction

Cometa leapfrogged from two schools back in 2022 to 300+ today. In the past few months, it brought in a new school every day to its platform. 🚀

By the end of 2024, Cometa is aiming for $4M in signed contracts. This growth is outpacing startup competitors, while Cometa’s user-friendly platform and efficient payment processing continue to draw more schools away from legacy systems.

A strong team of operators with a vision

All of this wouldn’t be possible without a brilliant team of founders behind it, with the right balance between mission ambition and execution capacity.

Andrés Benavides, Gonzalo Gallardo, and Mateo Creamer are all Stanford GSB grads, with a mix of founder (Codeable, PeerTeach), investor (Stanford GSB Impact Fund, Techstars, Thrive Capital), and operator background (Affirm, Duolingo). Valeria Tapia Cavassa completes the co-founding team – a user experience and design expert also with experience as a startup founder (Cuidafarma).‍

Future: Why we’re excited

Cometa is set to expand to above and beyond after raising its Series A. Yeah, no-brainer.

But we have a lot more to say about Cometa’s journey to build the definitive digital infrastructure for K12 schools in Mexico, and transforming the landscape of education management in Latin America with it.

Here’s their growth roadmap in more detail:

1. Win the K12 category: The focus right now is on being the best collections platform for schools in Mexico.
   
2. Expand the product offering: Starting in 2024, Cometa plans to add more features to serve different teams within each school.
   
3. Extend across the value chain: In the next two years, Cometa is eyeing ways to help schools manage everything regarding finance and operations.

With that, we can see how Cometa is becoming more than a platform; it’s a lifeline for schools desperately needing to conquer the financial and tech infrastructure that’ll allow them to keep educating future generations in Mexico and LatAm.

At Latitud, we’re excited to back them once again, now in a growth phase, and double down on a product and team that’s already making a difference in a critical market.

Cometa’s final grade? A+. 🎓

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A quick word about Latitud

Latitud is the first-check partner for LatAm founders building good sh*t.

It all starts with the Latitud Fellowship, our program for founders who wanna kick off something big for LatAm or the US with the support from Latitud's network. Entrepreneurs in ideation bring in the vision and commitment; we bring not only initial capital but a selected community of peers, mentors, and potential next investors.

As the leading pre-seed venture capital firm in Latin America, we become partners to top entrepreneurs inside and outside that Fellowship so they get even closer connections, guidance, and intros so they go from 0 to 1.

Latitud is led by Tomas Roggio and Brian Requarth. Through Fund I and II, we've already invested in 70+ amazing startups led by amazing founders (check them out).

Our bet in Cometa is another proof of our commitment to backing early-stage startups transforming industries and bringing positive impact to LatAm.

Sounds like you? Then we'd love to have a chat! Pitch your startup here.