Brazil’s fintech provider Sinqia acquires software tech startup NewCon for $75 million

Sinqia, a Brazilian fintech company that offers IT solutions to financial institutions, including banks, insurance companies, has acquired NewCon, a small tech startup and local developer of software for consortiums, in a transaction worth $74.73 million (422.5 million reais). The deal, which is Sinqia’s largest acquisition to date, includes a cash payment and five annual installments.

Founded in 2003, Newcon Software S/A is a Brazil-based software startup company with 190 employees. NewCon develops software for Brazil’s consortium market. Due to the high cost of big-ticket items, companies in Brazil create consortiums that allow members to collectively save by making monthly payments to buy big-ticket items like apartments and cars.

Through raffles, members are awarded letters of credit to make cash purchases, instead of having to pay interest in financing plans. Today, Brazil currently has over 130 consortium administrators that traded 181.8 billion credits from January to October this year, an increase of 38% over the same period last year, according to the data.

NewCon serves 80 consortiums created by financial conglomerates, carmakers, and other companies, “including those from the main financial conglomerates and car manufacturers, as well as independent managers,” Sinqia said in a statement.

Sinqia is one of the fastest-growing companies in Brazil and was selected in the years 2017, 2018, 2019, and 2020 as one of the 100 largest Fintechs in the world by the International Data Corporation (IDC).

Since its inception in 2005, Sinqia has made 22 acquisitions and currently has 410 customers and 110,000 shareholders. Sinqia offers four software platforms (Sinqia Banks, Sinqia Fundos, Sinqia Previdência, and Sinqia Consortiums) and two service platforms (Sinqia Outsourcing and Sinqia Consulting).