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Galixo is a partner of Seedstars World, a global Startup competition focused on emerging markets. This interview is the third one part of a series to explore with Seedstars World the different startup ecosystems and cultures in three very different parts of the world: Middle East/Africa, Asia and Latin America. SeedStars World just hold regional startup competitions in Mexico City, Santiago, Buenos Aires and Rio de Janeiro. They have now left Brazil to go back to Switzerland where the Final Competition will take place in February.
So what are your views and impressions about startup ecosystems in Latin America? What are the strengths and weaknesses of Latin American startups you’ve come across?
The ecosystem is very dynamic and present in all cities that we have visited across Latin America. They are at different stages, Mexico City being the most recent. All four cities we have visited have been or are starting to receive government support, which is helping to create and foster the tech scene.
In the region, it is commonly said: “The institutions are in Chile, the entrepreneurs are in Argentina and the market is in Brazil”. Indeed the most “stable” country we visited was Chile, while the culture in Argentina is by definition entrepreneurial and the numbers in Brazil (200 million people) push all startups to launch in this market.
Overall, government support is very strong. For example, in Chile the Startup Chile initiative gives grants of up to USD 50 000 to entrepreneurs from all around the world (80% of startups from this program are foreign) to come and accelerate their startups in Chile. The government also supports incubators in Universities and promotes innovation with strong international campaigns. For instance, 2013 being the year of Innovation it organized a flagship event called FIIS where speakers from all around the world (including guests like Jimmy Wales from Wikipedia) came to speak about Innovation and more specifically social innovation in an atmosphere of live music concerts and endless workshops.
We also witnessed the launch of the City of Buenos Aires innovation program that invited the Singularity University teachers and ambassadors to come and speak about the latest trends and breakthroughs. The city’s hope is also to promote entrepreneurship at an educational level, as early as high school. We are looking forward to see the actual implementations of this plan in the years to come.
Finally, after the big international buzz of Startup Chile, Brazil has launched its own program, Startup Brazil, that promotes accelerators and incubators by financing accelerated/incubated startups to up to USD 100 000 (grant). The country is also promoting strongly the link between Universities, entrepreneurs and big corporations with semi-private initiatives such as Open Innovation Week.
Are startups you met in Latin America ready to ‘Go Global’ from day one?
Most startups usually focus on a niche market for their products and tend to start with their local market. In countries like Chile and Argentina, where the population and purchasing power is relatively low, a lot of startups fail to think global or at least international. It’s a pattern we witnessed in the other regions as well. They think local because they don’t have the investment structure that is well developed to think global. But in many countries, the local market is not sufficient to scale. The most successful startups in Latin America are testing their product locally, but have quickly understood they must enter the Brazilian market to grow to the next level. Example: MercadoLibre.
Overall Latin America is much more directly influenced by Silicon Valley than the other continents that we have visited.
Tell us about the winners in Mexico, Chile, Argentina and Brazil? Why have they been chosen? What is their unique offering?
Pingstamp: Their startup had all factors to potential succeed locally: “a loyalty program that helps small & medium merchants understand and reward customers who love their business.”
Totus Power: This startup is part of the Startup Chile acceleration program, tackling a local problem globally for emerging markets. A great global project: “Schools lacking power in the 3rd world now have a battery power pack that is 10X cheaper & 6X more powerful. Totus Power is making this a reality by reusing Lithium Ion technology from electric cars.
Wideo: this is a new concept, but it has a lot of traction around the world. A tool to quickly help you make animation video. A great solution: “A “Do It Yourself” on-line tool to create animated videos and share feelings, ideas, products or knowledge with the world.”
Kudo: This startup has strong expertise on children education; it is a user-friendly interface education platform. Kudo is the fun, easy and effective way for preschoolers to learn a second language! Rosetta Stone meets Dora the Explorer for the iPad.
These startups are not unique in terms of innovation but they have a unique way to respond and tackle existing local and global problems.
Regarding financing, is there a big community of angels investors, VC firms?
The community is rather small and not really structured. Investors are not used yet to the risks related to early stage investments and on the other side the quality of the startup ecosystem is still at its beginning.
However, the government, correctly, is acting as pioneer to educate the ecosystem by facilitating investors to come and invest in their local scene and providing support to accelerators and financing to startups.
Now it’s been almost a year you’ve been travelling the world meeting startups in so many different regions globally. What are the big lessons learnt? How do you project the future of startups in emerging markets?
Now all regional competitions have taken place and all the regional winners will meet in Geneva for the Final competition. Can you tell us about the process in judging the startups? Also about the jury, will it represent the diversity brought together in this global competition?
- A 3 Day Bootcamp bringing together 20 selected startups who took part in our regional competitions to prepare them for the final event on the 4th and also to pre-select the top startups (we are partnering with universities and accelerators like IMD, EPFL as well as Galixo).
- All 20 startups will showcase their startups to the guests and only one will receive the title “Seedstars World Best Startup”
- This event is for people who are interested in discovering, collaborating and/or investing in startups in emerging startup scenes around the world.
- To buy a ticket go to www.ssw.vc
Galixo community will receive a 30% discount on the Standard ticket – Promotion code: Galixo30offSSW13
Tell us about Seedstars World 2014. What are your plans? Will the global startup competition expand in new regions and countries?
Our global competition Seedstars World is a yearly edition, so we are excited to announce Seedstars World 2014. Next year, we plan to expand and hold regional competitions in 30 countries including more cities in North Africa, Eastern Europe, SEA and Central America, so in total 10 more locations that in 2013. We will have a new team on board that will travel around the world.
Finally we have exciting news. We will be creating a Network Platform for all the 2013 selected startups from all around the world. More details about this new project soon. Keep checking Seedstars World website.