Kavak raises $300M as AI reshapes used-car lending
What's the deal? Kavak, a Mexico-based online used car dealer, has raised $300 million in an equity round led by Andreessen Horowitz. The firm invested $200 million, with another $100 million from investors including WCM Investment ManagementDealroom has a profile for this one. Try Dealroom → and Foxhaven Asset ManagementDealroom has a profile for this one. Try Dealroom →.
Kavak operates showrooms and an online platform for buying and selling cars, and it has ramped up lending through its financing arm, Kuna Capital. The company said it is now issuing loans at an annualised pace of around $600 million, using data and AI to assess borrowers.
Why now? The deal points to renewed investor interest in Latin America. Andreessen Horowitz said it was drawn to Kavak’s use of AI in consumer finance, applying the technology beyond software into everyday markets.
It is also the firm’s first Latin American investment through its Growth fund, run by general partner David GeorgeDealroom has a profile for this one. Try Dealroom →.
What could go wrong? Kavak is still recovering from rapid expansion that left it struggling to consolidate operations. Its valuation peaked at $8.7 billion in 2021 before dropping to $2.2 billion in a round in 2025.
The company posted its first month of consolidated profitability only in December, and chief executive officer Carlos Garcia OttatiDealroom has a profile for this one. Try Dealroom → said there is no IPO window this year.
The signal: The round marks the first investment in Latin America by Andreessen Horowitz’s a16z Growth fund and the firm’s largest investment in the region to date.
It points to renewed conviction in Latin America’s scaleups after a pullback in venture funding, especially when paired with clearer paths to profitability and practical uses of AI in traditional sectors such as autos and lending.
Sources:
Andreessen Horowitz
Bloomberg
Forbes
NeoFeed
J.V.
