Few months ago Colombia was revolutionized by the arrival of the creator of Facebook, Mark Zuckerberg, and his meeting with President Juan Manuel Santos. Within the framework of that meeting, Colombia became the first American country and fourth in the world to join Internet.org, an application fostered by Zuckerberg, which allows people with low resources access the network.
The visit of Mr. Zuckerberg left no doubt: Colombia is strongly stepping into the global technological scenario; but there is more data to confirm it. According to the last report issued by the World Economic Forum, Colombia ranks fourth on the list of countries with the highest number of innovative enterprises in initial phase, right behind Chile, Denmark and South Africa.
On the other hand, Massachusetts Institute of Technology (MIT) by means of its head of Technological Innovation, Enterprise and Strategic Management, Shari Loessberg, placed emphasis on the importance that is being given to technological innovation as a pillar of Colombia’s economy.
President Santos is leading this transformation. In 2012, he approved the creation of iNNpulsa as a governmental institution to support and promote the extraordinary entrepreneurial growth, which entails fostering high-impact innovation and enterprise, as well as fast-growing business.
Three key pillars have been developed by the entity over the past three years, with great results: mind change, market failure correction and the strengthening of actors throughout the country.
“We realized that we had to give entrepreneurial growth and high-impact enterprise a boost. Colombia has spent years supporting enterprises, science, technology and innovation, but there was no specific program aimed at those new companies that could be able to extraordinarily grow. That’s basically what iNNpulsa stands for” Catalina Ortiz Lalinde, General Manager of the entity, explains.
“This program was created because we have identified the existence of a more-dynamic entrepreneurial growth that requires different state support. In only three years, we have gone from a nearly null presence on the world entrepreneurial map to the first positions according to the latest report of the World Economic Forum”, Catalina Ortiz recalls.
Likewise, she points out that the program does not exclusively target tech startups, although there are many of them in the Colombian ecosystem. “It’s all about companies with growing potential above average in their sectors, which can compete in the Venture Capital realm. We also work with scale labs, with special emphasis on corporative enterprises” Mrs. Ortiz says.
The last point is especially relevant when it comes to financing companies. “In developed countries the capital is in the financial sector and the knowledge border is in universities, but in emerging countries like ours you find the knowledge border in companies and we don’t have an industry to fund those companies in early stages. That’s when the enterprise plays a leading role, its funding is a vehicle to support the growth of these companies” she says.
As for the target companies, the executive details the profile they look for: “More than enterprises, we’re looking for extraordinary entrepreneurial growth. That’s the reason why we don’t look at the experience of the company or the sector, but the growth potential.”
The mind and culture of the people have been some of the main axis and challenges that have had to be faced, specifically to change the way the think. “In order to carry out this transformation, the first challenge targeted the existence of an enhanced mentality and culture, because we found a lot of barriers and the lack of ambition was the most important one. Colombians are now more ambitious when it comes to building their company” Mrs. Ortiz underscores.
The market gaps in terms of the financing industry were another line of work. “These companies grow in a peculiar way, other financing instruments are required, and accelerators are needed in the country. From iNNpulsa we have helped complete a scenario with better financing for initial stages” she details. Several pieces of news related to this matter were received in January. For instance, Mexico’s IBBA Investment Group is interested in supporting enterprises in Colombia in 2015 and the Bancóldex Group will be backing up companies with growth potential.
Another aspect that required work was the diversity among the country’s different regions, especially the difference between urban and rural. “We have had different instruments for each maturity level in the regions. In some places we were ready to apply accelerators with the most ambitious mentality, but there were other places where we had to start from zero, plan what and how to strengthen the region and identify companies with potential” she explains.
Part of the excellent results achieved is reflected on the portfolio of “The Best Colombian Startups to Invest”, which includes nearly 40 companies with great potential.
“The companies apply and we renew it every three months. We also have a pipeline made up of about a thousand companies that could eventually join the portfolio” the executive says and adds the “there are interesting companies in all industries, with special mention to those linked to the biotechnology, bio-agriculture and food, such as Factoria Quinoaand Solar Ciencia Agrícola, among many other.”
Ortiz Lalinde highlights that several successful entrepreneurs have somehow returned to the country. “Andres Barreto, for example, has developed an enterprising career and has returned as an investor and accelerator. The same happens with Alexander Torrenegra who has succeeded with his Voice Inc. in US, but is also in Colombia with Torrenegra Labs and is an investing angel too. We have Juan Roldan with his valuable Mentez Labs and he is a serial entrepreneur that revitalizes the local ecosystem. An encouraging sign, many successful Colombians are returning to the country, investing here” emphasizes.