MEXICO CITY, Mexico: The venture capital firms, Spain's Seaya Ventures and France's Cathay Innovation, have established a joint fund aimed at investing in innovative startups across Latin America.

In April, the two firms officially combined and have since opened an office in Mexico City, where they will manage the "Seaya Cathay Latam Fund" worth $125 million, focusing on Series A and B investments, and with reserves for follow-on rounds.

Beatriz Gonzalez, founder and managing partner of Seaya Ventures, said the connection between Spain and Latin America remains strong.

"There were not many funds (in Latin America) when we started in 2013, and today the market is competitive. You cannot just bring funding to the table, you have to have funding, network and support," she said, as reported by techcrunch.com.

Federico Gmez Romero, who previously led LatAm activities for seed fintech fund Accion Venture Lab, will manage the fund locally.

The fund will focus on consumer and enterprise companies developing technologies in areas such as fintech, proptech, mobility, healthtech, food, agriculture and cybersecurity.

It will also utilize Cathay's corporate ecosystem as investors and strategic partners.

The team made its first investment in September, contributing to Chilean fintech Xepelin's $230 million round.

As individual venture capital firms, both have invested actively in the region, including in Mexico's Kueski and Lana, Brazil's Facily and alt.bank, and Colombia's RobinFood and Chile's Fracttal.

According to Jacky Abitbol, managing partner of Cathay Innovation, the fund will make investments in 12 to 15 companies of between $5 million and $10 million, stressing that it made sense for his firm and Seaya to come together.

"Our intentions are to be a global player, and we saw opportunities to be part of the local ecosystem. We share a lot of values and the same way of thinking, so we decided to partner to support bigger tickets and put to work a platform we built with an initial investment to support founders," he added, according to techcrunch.com.