Colombia’s Entrepreneurial Ecosystem: Interview with Carlos Castañeda

My next stop in Bogotá was to speak with Carlos Castañeda at Wayra. By now, you should all have a pretty good idea of what Wayra does as I’ve chatted with the Wayra teams in Chile, Argentina, and Peru before making it to Colombia. (If you’re just starting to follow Startup Nomad you can go back and take a look at the interviews with the other Wayra leaders here, here, and here. Instead of rehashing the Wayra discussion, Carlos and I jumped right into talking about what sets Colombia’s ecosystem apart from the others in the region and the world.

**Please note, my interview with Carlos was conducted in Spanish and I’ve paraphrased some of what he said.**

According to Carlos, a lot has changed in Colombia over the last 2.5 years. Previously, neither the government nor the private sector invested in startups so an entrepreneur who really wanted to build a new company had to go to a different country. In the last 2.5 years that has changed a lot, however, not only because of Wayra or because of the support of the government, but also because new investors have arrived in the country.

“We still don’t have an ecosystem that is fully developed,” he told me, “but we have one where we’re growing much faster than other countries on some metrics…

The number of people who are thinking about startups is greater and the talent is developing their technical capacity more…the coders are more skilled, the business people understand better how to get venture capital…

We’re raising the level…I’m confident that we will be the new hub in the region.”

Despite the rapid development, however, Carlos mentioned the same couple of issues that have continued to pop up with the majority of the people I spoke with throughout the region.

“The difficulty here is that we don’t have success stories and we don’t have access to capital,” he told me.“The investors here are more interested in traditional investments. They want to buy another building or something like that, not invest in a risky startup…[and] in Colombia there are very few people with a track record. Cases of major success don’t exist. We don’t have a rock star.”

Colombia is also still at the stage that many of the budding startups are still copy-cats of successful companies in other parts of the world. Carlos noted that it’s logical that there would be a lot of copy-cats because the development of things like e-commerce in the country are very low, even the adoption of the internet is very low. As Colombians gain access to and confidence in using these technologies, the opportunities are there for the copy-cats.

“It’s very different to build a startup here than to do it in San Francisco or in Tel Aviv. You have to understand the Latin American culture,” Carlos told me.

We also talked about the rivalry and differences between Bogotá and Medellín, Colombia’s two startup bastions. “I’m from here, I live here, I love it here, but I’m fascinated by what’s going on in Medellín,” Carlos said. From his perspective, Bogotá has a much larger population and the people know a little more about startups and the startup process but Medellín now has a program from the city government [Ruta N – you can read that interview here] to support the development of entrepreneurship. Additionally, in Bogotá, the majority of entrepreneurs are still Colombian. Unlike in Medellín where there is a huge population of foreign-born entrepreneurs, foreign entrepreneurs are just starting to arrive in Bogotá. Plus, Medellín is very small and all of the entrepreneurs congregate in one area so if you visit, you will see tons of them. In Bogotá everything is more spread out and there are many more people, so you won’t see the density of foreign entrepreneurs even though they are coming.

And Carlos’ advice for aspiring entrepreneurs? “The first thing is to think like your customer. Think like your customer and how your product will solve their problems. Why would they spend their money or spend their time for your product or on your platform?”

 

Do you have experience with the entrepreneurial ecosystem in Bogotá? Let me know what you think of Carlos’ thoughts in the comments section below. 

Peru’s Entrepreneurial Ecosystem: Interview with Luis Lira

Next stop in Peru: Wayra. By now I’m sure you’re all familiar with Wayra as I’ve already posted interviews with the Wayra teams in Chile and Argentina. In Peru I got to meet with Luis Lira who was gracious enough to give me a tour of the Lima offices and share his insights on the entrepreneurial ecosystem and startup scene in Peru.

Peru’s Entrepreneurial Ecosystem: Interview with Arturo Cánez

My next interview in Lima was with Arturo Cánez, the Director of Lima Valley and Co-Founder of Startup Academy. He’s also a mentor for Wayra Peru and is incredibly involved in the entrepreneurship community in Lima in many ways. Through his various initiatives, he works to provide events that both foster a community of entrepreneurs and offer training to aspiring entrepreneurs.

While Lima ranks high when it comes to entrepreneurship on measures like those used by the Global Entrepreneurship Monitor, much of the entrepreneurship in the country has historically been that of necessity and wasn’t the high-growth, technology-driven entrepreneurship that gets lots of press. Therefore, even though Peru actually ranks very high in entrepreneurial activity, its startup ecosystem is still a bit behind those in other countries. However, people like Arturo are helping to change that rather rapidly.

“The ecosystem now is better than just one year ago,” Arturo said.  “We have the fastest growing entrepreneurial network in Latin America…What other countries did in 5 years we did in 1 year and we did it without the support of the government.”

There’s still a lot of work to be done, however, to transform Peru from a country built on entrepreneurial necessity to one with a thriving culture of entrepreneurial innovation.

“For the stage our country is at right now, we have a lot of copy-cat ideas,” Arturo noted. “95% are maybe imitation and the other 5% are innovation.”

This preponderance of copy-cat companies is step one in the growth of a new startup hub and truly innovative companies are bound to come soon once entrepreneurs fully commit to their new ventures. According to Arturo, lots of entrepreneurs in Peru have a day job and are working on their startup on the side. “There are a lot of innovative ideas, innovative companies here in Peru and in Latin America,” but people are scared to leave their jobs and do their startup full time.

Additionally, Arturo argues that

“today, it’s easier here in Peru to get funding than in a different country or even in Silicon Valley…there is a lot of private capital but that capital is not necessarily focused on technology companies.”

He also believes that more accelerator programs focused on technology startups are needed to help anchor the entrepreneurial community in Lima and that the community shouldn’t focus solely on tech and business experts.

“We believe that a new venture, a new company, works better with different skills,” Arturo said, “not only business and technology…so that’s why we promote a multidisciplinary community.”

Finally, Arturo sees the future of the entrepreneurial ecosystem and startup community in Lima intimately tied to the other hubs in Latin America.

“You have, here in Peru, markets that are growing so fast,” Arturo said. And “at this time we need to detect what we are doing different than the other countries…[However], I think it’s so important that new entrepreneurs focus not only on their own country and take not only a local view…We want to focus on our local community but we’re connected to more developed countries…and we believe that those connections help to create a stronger environment.”

In fact, Arturo sees these connections as the future of the ecosystem.

“I think that in 5 years we’re going to have Latin America connected, a lot of countries linked, and a lot of startup entrepreneurs doing their jobs in different countries. In 5 years I think we will have a Latin America with an ecosystem similar to Silicon Valley.”

 

 

Argentina’s Entrepreneurial Ecosystem: Interview with Juan Melano

My next stop in Buenos Aires was to speak with Juan Melano, one of the original organizers of Palermo Valley and the Founder of Comenta.tv, which is a portfolio company of the Wayra program in Argentina. Juan is a cancer survivor and after that experience he knew that he needed to find a way to have his dream job before he died, which is how he ended up in entrepreneurship.

Juan shared with me that Argentina’s biggest asset when it comes to entrepreneurship is its talent pool.  “If you’re starting your company here the good thing you’ll get is the human resources here…very good people who are very good at what they do,” he said. He continued:

“There are a lot of talented people here – very well-educated, very capable, very creative – and not very expensive compared to the United States…[Unlike in other countries, in Argentina] there is a lot of talent everywhere – a very good mix of engineers, of business people, of designers. It’s a very good mix to create.”

Because he recognized this talent pool in Argentina, Juan was one of the original supporters of Palermo Valley back in the mid-late 2000s. Through Palermo Valley, he said, Buenos Aires started to develop a real community of entrepreneurs. Before that there wasn’t a community and people didn’t share and communicate but Palermo Valley was able to start connecting people and an ecosystem began to develop. However, there was still a lack of capital because venture capitalists were the only source and they would only invest in copy-cats of U.S. based companies with already proven business models and that were designed to be quickly acquired when those U.S. companies decided to expand into Latin America. Truly innovative new companies didn’t have the opportunity to start or grow until more recently.

When Wayra, government programs, and other sources of capital started to come in to fund these truly innovative companies, it wasn’t long before the community really took off. “Now we have another problem,” Juan said, “that there are a lot of startups trying to raise an additional amount of money…We do have a great local ecosystem and I think everything is because of what happened in those early meetings at Palermo Valley…

…In 2011 we [people in the Argentinian entrepreneurship scene] took a trip to Silicon Valley and they were like ‘Who are these guys?’ Now they know who ‘these guys’ are.”

And since Argentinian entrepreneurs are now recognized, “VCs are no longer investing only in clones but also in original ideas.” Plus,

“there is a lot of angel investing as well that wasn’t happening before and is contributing to the growth of this ecosystem.”

On the negative side, however, Juan said that government regulations aren’t very “open-market friendly.” To open a company and get everything up and running will take six months so Juan actually wouldn’t recommend starting a company in Argentina unless there is a clear strategic reason to do so. He would recommend a country with a more streamlined process for opening a business, like Chile. However, these regulations could change at any moment with the whims of the current politicians.

“That’s the thing in Argentina,” he said, “you never know.”

So what’s Juan’s advice for aspiring entrepreneurs? First he said, jokingly but seriously,  “it’s a nightmare, don’t do it.” He continued on, however, to say, “but if you’re really passionate about it, it’s the best thing that can happen to you because it’s like a little baby that you see grow up and it’s an extension of yourself.”

So his real advice?

  1. “Just do it.”
  2. You need to build a team that you can really care about because you will be with them every day and every night.
  3. “At the end of the day it really doesn’t matter where you’re based but how you deal with the different markets and how you build your company.”

Finally, some parting words of inspiration from Juan:

“[Entrepreneurship] is not about the money. It’s about really being passionate about something: about an idea, about something you want to change, you want to do, you want to create and you make it possible, and by making it possible you are living the dream.”

 

 

Argentina’s Entrepreneurial Ecosystem: Interview with Lorena Suarez of Wayra

My first stop when I arrived in Buenos Aires was at Wayra to speak with Lorena Suarez. Having visited the Wayra offices in Santiago when I was in Chile I knew that the people at Wayra in Argentina would be super well plugged in to what was happening in the ecosystem and might be able to point me in the direction of some great events and/or people to talk to so I was psyched that Lorena agreed to sit down with me and chat.

Lorena came to Wayra after working in telecommunications for a number of years and she transferred from another group within Telefonica (the telecommunications company that owns Wayra) to Wayra. She has a background in economics and business and has been with Wayra for 2 years.

According to Lorena,

“Argentina has a very strong entrepreneurial culture.”

There are a lot of large internet companies created in the lates 1990s and very early 2000s that are still up and running in Argentina. After 2001 the activity stopped but nowadays the activity is growing again. “The quality and amount of startups in Buenos Aires today is significant and interesting,” Lorena said. “We’re seeing more and more major projects with major teams and balanced teams…We evaluated almost 3,000 projects [this year].”

Lorena noted that while “the political and economic context is not very simple for entrepreneurs [in Argentina],” this instability has actually aided the entrepreneurial ecosystem in some ways.

“Fortunately or not, we are trained to handle uncertainty and perhaps that’s why Argentinian entrepreneurs can be so creative: because uncertainty is something that’s been present in our history and our economy,”she said.

She also noted that Argentina has a lot of talent to offer and “talent is the most valuable asset.” Entrepreneurs that start their companies in Buenos Aires have access to people who are well-educated and can find talented and experienced engineers, designers, and others.

On the negative side, however, starting a company can require a massive amount of patience as you’ll need up to 2 months to wade through the regulations and processes necessary to open a new business there.  Additionally, as with many countries in Latin America, there is a lack of funding available for startups – especially at the early stage after seed funding but before they’ve created enough traction for a Series A round. “After finishing at an accelerator the companies already have clients, they’re already at break-even, they have a clearer idea of where they’re going but they don’t yet have enough traction to go to a VC for a series A,” Lorena says. “We are starting to see people filling this space but, for me, there is still room there for people to fill that space.”

Lorena continued:

“Investment is also something that needs to be created and developed. 50% of investments in Argentinian startups came from abroad, from foreign investors. I believe that it’s a matter of time all over Latin America but we still need to mature in this area.”

“At the beginning, we needed to explain what an accelerator is here in Buenos Aires and it’s very, very new how to pitch, how to deal with an investor, how to present yourself, what an investor looks at, what you need as a team, all of those things. Nowadays I think we’ve improved a lot but at the beginning we needed to explain.”

So what advice does Lorena have for entrepreneurs just starting out?

  1.  “Focus on traction. Don’t fall in love with your ideas, just go out and try to communicate with your customers. Customers or users are the ones who really say that what you are creating has value.”
  2. “Focus. It’s really easy to get distracted…I prefer to see a company that does, in an excellent way, 1 thing and not a lot of things in an average way.”
  3. “Give back. We are all players, not only the venture capitalists, accelerators, and other investors but also the entrepreneurs. If we want to create an ecosystem we need to understand that we are all key players, entrepreneurs too…Creating a very strong and very creative entrepreneurial ecosystem in Buenos Aires is something we all need to keep in mind.”

Chile’s Entrepreneurial Ecosystem: Interview with Claudio Barahona of Wayra

If you know anything about entrepreneurship in Latin America you know that Wayra is an incredible powerhouse in the space. Owned by Spanish telecommunications giant Telefonica, Wayra is an incubation program with locations in numerous countries in Latin America and Europe. I was lucky enough to speak with a few of Wayra’s representatives along my journey through Latin America and my first introduction was with Claudio Barahona, the Business Development Manager for Wayra’s Santiago, Chile office.

Claudio was kind enough to let me pick his brain about Wayra and the work it does as well as about Chile’s entrepreneurial ecosystem. He also gave me a tour of the offices and we chatted with entrepreneurs from Crowdsourced Testing and Thinker Thing about their experiences in Startup Chile, Wayra, and Santiago’s entrepreneurship scene more generally.

The video is a long one this week but trust me, it’s well worth it. Check out what Claudio and some of Wayra’s entrepreneurs had to say and then let me know your thoughts: