Entrepreneurship is not a new concept in Bogotá. From the amateur rapper who hops onto a buseta for an unsolicited performance, to the thousands of small-business owners who work hard to keep their doors open, people here commonly take personal risks to run their own money-making show.
However, a new kind of Colombian entrepreneur is emerging: the Internet startup. Initiatives sponsored by Bogotá’s Chamber of Commerce and the Universidad Nacional, with ‘Startup Weekend’ are based on offering specialized courses where skilled strangers can meet, brainstorm, program, design, and plant the seeds for an original Internet-based—and more importantly, Colombian-based—company.
Despite a lack of sleep, participants during October’s ‘Start up Weekend’ were fired up until the very end, eager to prove to themselves and to the judges that they could provide salable solutions to their country’s problems. It was hard not to admire the passion in the room and the overwhelming support for each fellow competitor. According to Pedro Medina, president of Yo Creo en Colombia (yocreoencolombia.com), the October sessions represented the Colombia he “dreams on,” where trust, talent, and tenacity come together to make a big, potentially global impact.
No, Bogotá won’t be the next Silicon Valley—no other city in the world has yet been able to foster the culture that has made onetime startup companies like Google or Facebook thrive. But for Colombians the startup community in Bogotá could indeed become something special.
Medina also remarked that while Colombia has always been rich with natural capital—the country, for instance, ranks first in the world for biodiversity per square meter—and is also sufficiently endowed with human and physical capital, the one thing still lacking is social capital, the ability to trust each other and to work together. Internet startups, by their very nature, fill that gap.
Startups, he says, are a product of the empowerment Colombians have discovered in just the last decade or so. “They are representative of a country that is learning to fly free, and a country that is learning to shorten the idea-action gap,” Medina says.
With its advancing economy and increasingly global perspective, Colombia is at a crossroads. In Medina’s words, Colombia can choose to be “a country full of copycats and people that reproduce other people’s knowledge, or a country that creates knowledge, that creates opportunities.” If Startup Weekend Bogotá was any indication, the sentiment among young entrepreneurs certainly swings toward the latter.
However, this may just the beginning for Colombia. It still has a long way to go to catch up to the United States or its regional neighbor Argentina, to name a few industry leaders. According the judges, while ideas and willpower are readily present among Colombians, resources and execution often come up short.
Dan Gertsacov, the current regional CEO of Lenddo, a social-media-based financial lending site, points out that Colombia’s Internet penetration is now where the United States’ was circa Y2K. Even so, it’s a start. “We know where the story ends,” Gertsacov told me, noting that entrepreneurs here can use the U.S. tech boom as a model for growth. Not to mention, Colombians now have the advantages of social media and mobile access that U.S. companies didn’t during the earlier dotcom days.
Like those first U.S. startups, Colombian companies must really swim upstream to find success.
Financing, for one, remains somewhat elusive. Investors don’t throw money at Colombian-based enterprises like they often do at those based in the San Francisco Bay Area. And with the limited IPO market, there haven’t been too many stock market victories in the Colombian tech world, nor have there been enough big-time acquisitions to nourish a cycle of angel investment, yet.
There’s also less industry expertise to go around. Most of the twenty-something designers and programmers are just starting out and don’t quite know yet how to make their ideas globally scalable and lucrative. Fortunately, mentors at the Startup Weekend are beginning to change that as they return to Bogotá to share the strategies and best practices they learned elsewhere.
Colombian Internet entrepreneurs also face an interesting cultural obstacle—lack of trust. This is especially an issue for marketplace-style endeavors that require money exchange. It’s the reason, in part, why a company like Craigslist, while rampant in U.S. cities, hasn’t really taken off here. Latin Americans are generally more hesitant than their other Western counterparts to exchange cash and goods with unknowns in the Internet space. Likewise, credit cards and online banking are still not as widespread as they are elsewhere.
Still, for more social endeavors, the domestic market—which includes roughly 22.5 million Internet users—is there. Colombia, with over 17 million accounts, ranks 16th in the world for in Facebook users (even higher if you consider hours spent signed in). Twitter is also wildly popular. In that sense, the enthusiasm of Colombian Internet users offers a lot of hope.