Blog | Startup in LATAM: Challenges and Silver Linings
By: Mack Meyer
Since I moved to Mexico approximately a year ago, I have engaged with close to 100 startups across Latin America. Over the course of these conversations I have identified several prevalent obstacles that founders confront when initiating startups in Latin America. Below is a list of a few of these challenges.
?
Access to Capital: Traditionally, there has been less venture capital available in LATAM compared to other regions like North America or Europe. This makes it harder for startups to find the funding they need to grow. However, the situation has been improving in recent years with more local and international investors showing interest in the region.
?
Regulatory Environment: Many LATAM countries have complex and sometimes unpredictable regulatory environments. This can make it difficult for startups to navigate legal requirements, taxes, and compliance issues. Additionally, bureaucracy can be cumbersome and time-consuming.
Economic Volatility: Some LATAM countries face economic instability, with fluctuating currencies and inflation rates. This can impact startups, especially those that depend on imports or have costs in foreign currencies.
?
Market Fragmentation: Latin America is a diverse region with significant cultural, linguistic, and economic differences between countries. This fragmentation can make it challenging for startups to scale across borders as they need to adapt to different market conditions in each country.
?
Talent Acquisition and Retention (Recruiting): While there is a growing pool of talented professionals in LATAM, competition for top talent is intense. The challenge for founders becomes whether they hire the candidate from other regions such as the US or Europe and pay more or hire a candidate that may not have the expertise they exactly want, but hope they can grow into the role. Additionally, this gap is most evident in areas of expertise such as technology.
?
Intellectual Property Protection: In some LATAM countries, protecting intellectual property can be challenging, which can deter innovation and investment from foreign investors.
?
Despite these challenges, LATAM also offers immense opportunities due to its large and growing consumer market, increasing internet penetration, and a rising number of success stories that are inspiring a new generation of entrepreneurs. Moreover, governments in the region are increasingly recognizing the importance of startups for economic growth and are implementing more supportive policies.
News
January 25, 2024
Argentinian fintech Pomelo raised a $40M Series B led by Kaszek. monashees, Index Ventures, Insight Partners, S32, and Endeavor Catalyst also participated in the round.
January 29, 2024
Konvex will use the funds to expand its operations in Colombia and enter new markets across Latin America.
January 26, 2024
Daki, a Brazilian digital supermarket startup, secured a $5M investment from “media for equity fund” 4Equity Media Ventures to invest in marketing strategies across different channels.
January 25, 2024
Genial Care, a Brazilian health-tech specializing in services for children with Autistic Spectrum Disorder (ASD) and their families, secured $10M in a funding round led by General Catalyst.
领英推荐
Upcoming events
Thursday gathering by Venture Café
February 1st | 10:00 am CST
Funders & Founders Networking by ATX Tech Pros: Entrepreneurs, Investors, and Professionals
February 1st | 4:30 pm CST
Fuckup Nights -Tech Startups by Monterrey Digital Hub
February 8th | 7:00 pm CST
Tarde de Fintech by csofmty
February 9th | 6:00 pm CST
What are we listening to this week?
Avril 14th by Aphex Twin
Recommended by Francisco Azcúnaga, CEO and Founder