The South American entrepreneurial community is no longer a small band of companies vying for attention. Instead, it is a full-fledged movement with an ecosystem that is creating new connections for the economies of Argentina, Brazil, Chile, and the rest of the world.
These entrepreneurs represent a movement now. They are the “TechnoLatinas,” and their growing strength became readily apparent this past week at Disrupt San Francisco 2012.
Ignacio Peña is a Buenos Aires entrepreneur who coined the TechnoLatinas term to help define a movement whose growth plays off a combination of factors:
Mercado Libre is Argentina’s biggest success story. The eBay-style company is now trading on the NASDAQ. Its founder, Hernan Kazah, started the Buenos-Aires based Kaszek Ventures, which is now the biggest fund in South America. Kaszek made its most recent investment in Restorando.com, an online reservation site for Latin America.
Buenos-Aires based Mariano Suárez Battán sold his gaming company, Three Meolons to Playdom in 2010. Walt Disney acquired Playdom for $763 million four months later. He has a new startup called mural.ly, which he described to me as a cross between Pinterest and Prezzi.
In an interview at Disrupt, Battán said he credits Argentina’s success of late to the first and second generation of startups who are now mentoring a younger group of entrepreneurs.
Battán said one of the biggest struggles is acceptance by Silicon Valley investors who are still skeptical about the stability of the Argentinian startup ecosystem. Battán said he incorporated in Delaware to help boost confidence in his startup. Mural.ly launched at TechCrunch Disrupt. It has raised $775,000 in seed funding from Intel Capital, Alta Ventures, 500 Startups and angel investors.
“This will change once we have more talent,” Battán said.
As a signal of its support, the Buenos-Aires government brought 32 companies to Disrupt San Francisco. Peñasays the city promotes development through the creation of incubators, conferences, a dedicated tech district, and tax exemptions.
“We don’t give money to entrepreneurs,” said Enrique Avogardo of the Buenos-Aires city government in an interview at Disrupt. “We give them space to work, soft credit lines and grants.”
In an interview also at Disrupt, he said he views Argentina as a great place to hire developers but Brazil has the ecosystem.
After the dot-com bubble burst in 2002, Brazil’s tech scene focused on IT. The shift to startups started to show its first trickles in 2006. In 2008, the first angel investors arrives from the United States. The first accelerator opened its doors to entrepreneurs. And Microsoft Biz Sparks opened a number of innovation centers to connect developers with businesses.
And the infrastructure is emerging. Amazon Web Services opened a data center in Sao Paulo last December. Google is now building a data center in Chile.
As for Chile? They are the underdogs who have captured the world’s attention with Start-Up Chile. Companies like Suede Lane from Toronto have moved to an entirely new part of the world to be a part of the entrepreneurial community that Start-Up Chile has developed. Peña says Chile is leveraging its open, stable and low friction economy to become the tech hub for Latin America and put in place a host of measures to materialize this vision, including financial support programs, grants, competitions, mentor networks, and improved legal and procedural frameworks that make it easier to launch and run a startup.
The South American startup scene is representative of a global startup culture that had its start in San Francisco and the Silicon Valley. A culture that has its roots in free thinking about what the world can be is not something that is just solely the enjoyment of tight community in California. It’s something people across the globe embrace.
The challenge for the region is not about getting people excited about startups. It’s more so in the development of the ecosystem and the infrastructure. That’s the challenge of any developing country. But more so than ever before, it’s a chance for South America to take a leapfrog ahead and establish itself as a leader on the world startup stage.
The Kekanto is the social network of online word of mouth online where you exchange reviews and recommendations on places and services.
Mercado provides a commerce-specific search engine for online retailing. The company provides software used to manage e-commerce operations, including merchandising, searching, catalog management, and browsing functions. Mercado provides eCommerce professionals with a platform on which to execute merchandising strategies and drive revenue growth.
Restorando.com is the leading online reservation website for Restaurants in Latin America. The company was founded by Frank Martin, Franco Silvetti, Andy Freire and Santiago Bilinkis in October 2010, aiming to address the lack of efficiency in the reservation process at Restaurants. The company has operations in Sao Paulo, Buenos Aires and Santiago de Chile, planning to expand to new gastronomic clusters in the region.
Kaszek Ventures is the leading Latin American venture capital firm investing in high-impact tech entrepreneurs. Led by Nicolas Szekasy, MercadoLibre’s former CFO, and Hernan Kazah, MercadoLibre’s co-founder, the firm actively supports its portfolio companies through value-added strategic guidance and hands-on operational help, leveraging its partners’ successful entrepreneurial backgrounds and extensive network.