Kavak has secured $300 million in fresh equity. The round was led by Andreessen Horowitz, better known as a16z, which committed $200 million. Another $100 million came from investors, including WCM Investment Management, which co-led the deal, and Foxhaven Asset Management.
According to PitchBook data, companies in the Latin American region attracted about $6.2 billion last year, the strongest tally since 2022, as investors cautiously returned after higher US interest rates cooled pandemic-era exuberance.
From marketplace to financial engine
Founded in 2016 in Mexico by Carlos García Ottati, Loreanne García and Roger Laughlin Carvallo, Kavak built its name by formalising a fragmented used-car market. Customers can browse inventory online, visit physical showrooms, trade in vehicles and access servicing, all under one brand.
Its financing arm, Kuna Capital, has become a powerful growth lever. After securing $400 million in debt facilities early last year, Kavak accelerated lending. It now runs at an annualised pace of roughly $600 million in loans, underscoring how credit is central to its model.
This blend of commerce and financing gives Kavak tighter control over margins and customer experience, while unlocking recurring revenue streams often absent in traditional dealerships.
A reset after the boom
At the height of global venture enthusiasm in late 2021, it reached an $8.7 billion valuation in a $700 million round. Rapid expansion across Latin America and into the Middle East followed, but consolidation proved challenging as capital tightened.
Last year, the company’s valuation fell to $2.2 billion in a subsequent funding round. The latest raise was completed at a higher valuation than that prior round, though CEO Carlos García Ottati declined to disclose the exact figure.
He insists the business is now on sturdier ground. December marked Kavak’s first month of consolidated profitability. After years of aggressive investment and cash burn, the company has recalibrated operations and sharpened execution.
Why big bets on Kavak?
The deal represents the first Latin American investment from Andreessen Horowitz’s a16z Growth fund, led by general partner David George, and stands as the firm’s largest bet in the region to date.
Part of the attraction lies in how Kavak deploys technology across pricing, inspection and customer service. García Ottati said the investors were drawn to seeing how advanced systems operate at scale in everyday transactions in the mechanics of buying and financing a car.
Kavak achieved unicorn status in 2020. Today, with capital secured and profitability within reach, it says it is structurally prepared for a public listing when timing aligns, though not this year. For now, the focus is on disciplined growth and proving that Latin America’s largest used-car platform can thrive beyond the boom cycle.
“We’re able to finance more users because we have data that allows us to understand our users better,” Carlos García Ottati stated. “With that data and using AI, we can make more bets on people than we could a year ago. It feels like day one for us. Now we can finally start building what we set out to build when we started the company.”
