A new era for startup investing in Latin America

Startups in Latin America are using creative solutions to address not just local but also global problems. For investors outside the region, the prospect of working with these startups can appear attractive, yet complicated. Investing in early-stage startups in Latin America can present challenges; however, despite the challenges, time and time again I’ve found it can be well worth the effort.

When I first came to Santiago, Chile in 2010 as part of the pilot round of Start-Up Chile, there was hardly any talk of startups. Most people didn’t even know what startups were. Within nine months of returning to the U.S., the company I co-founded was acquired. So I decided to go back to Chile to look for more opportunities in this emerging market.

Over the next couple of years, I taught entrepreneurship in Chile, mentored local entrepreneurs and eventually started investing in Latin American companies myself. I’ve now invested in more than 30 early-stage companies in Latin America, and I firmly believe the time to help early-stage startups in Latin America has never been better. Here’s why.

Pioneer VC firms have paved the way for others to invest confidently in the region

Some of the earliest VC firms established in the region, such as NXTP Labs in Argentina and Vox Capital in Brazil, have paved the way for others to find success. In a region that is traditionally very averse to risk and tends to condemn failure, these firms took a chance on budding ventures long before others dreamed of doing so.

These pioneer VC firms in the region faced plenty of challenges. First, they had to educate and develop the expectations of local entrepreneurs so that they realized that Latin America is not Silicon Valley, with easy access to venture capital and U.S.-style valuations. But their successes and failures have served as exemplary models…

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