XP Inc. (NASDAQ: XP) disclosed that it has decided to invest in Virgo which is a financial solutions and capital markets services firm. To fulfill this the firm has purchased the minority stake in Virgo. Presently, Virgo has more than 105 institutional investors gearing up to offer capital to small and medium-sized firms. It will also enable them to fundraise more than R$50 million in less than 12 hours.
The securitization platform of the firm named Virgo Securitization Company is likely to benefit from the investment. At the moment, the platform is the largest agricultural and real estate securitization firm in Brazil, with a 38% market share in issuance volume in 2021, and a supervised portfolio of over R$35 billion.
In addition to this, the investment of XP will enable Virgo to speed up its scheme to build the largest capital markets access marketplace for small and medium-size firms and projects in Brazil. Moreover, Virgo is also planning to utilize the profit for team hiring, technology investments, and the development of new products and solutions.
Furthermore, it has been disclosed that Virgo disclosed that its main aim is to combine Virgo Financial Solutions into the largest hub for the allotment of high yield and complementary products for institutional investors.
The investment of XP Inc highlights the struggles of the firm and demonstrates that it is pursuing in the right direction. It also underscores and that it has the correct strategy and talented team to continue on its journey separately, but with additional resources to help it speed up expansion plans. The governance and independence of each firm will remain unaffected.