Silicon Valley style tech startups hold promise for Latin America. Several Latin American cities were hailed as a “new Silicon Valley” in the last decade. The 2020s promise to be a turning point for these emerging tech hubs. Thriving start-up ecosystems in Colombia, Chile and Uruguay, in particular, have drawn attention from the less surprising tech investments of their bigger neighbors Mexico and Brazil.
Conditions helping tech start-ups to thrive in these countries are indeed comparable to the early days of Silicon Valley. However, the way those conditions are being cultivated is fundamentally different.
The most crucial difference during the next decade will be the growing pressure because the original US tech giants are expected to advance on the region, galvanizing the local players. This is because they understand the digital direction of development in their countries and how to take advantage of it.
Uruguay stands in particular contrast to the non-specific favorability of California’s business environment. It has a 100% income-tax exemption for exports of software, which has made Montevideo a center for videogame development.
Source: Global Data Technology.
Talent is also being fostered in progressive education systems
It could be said that Colombia, Chile and Uruguay lack the world-class universities which fostered many nascent talents in Silicon Valley. This is another area, though, where the Valley’s successors in Latin America are forging their own paths.
Chile, meanwhile, boasts tertiary enrolment on a par with the US. The US Factory education and funding program for female start-up founders supplies the tech industry with ambitious graduates.
Uruguay performs impressively in education, partly thanks to its early adoption of the One Laptop Per Child initiative. Uruguay stands in particular contrast to the non-specific favorability of California’s business environment. It has a 100% income-tax exemption for exports of software, which has made Montevideo a center for videogame development.
In the coming decade, these favorable conditions will give Colombia, Chile and Uruguay huge potential. They should be able to generate their own unique innovations, even before the arrival of Silicon Valley tech giants.
In Colombia, for example, the rapid growth of internet penetration and increasing affordability of mobile devices is making self-learning through mobile apps a genuinely impactful tool. In late 2019 The Colombian Ministry of Information and Communication Technologies partnered with Coursera to offer free access to tech courses to 25,000 ambitious young Colombians.
According to a report from Global Data’s Report Store this environment is making for a uniquely innovative landscape of new tech companies. This is because they understand the digital direction of development in their countries and how to take advantage of it.
Latin America has a huge surface of over 20 million square kilometers, covering four sub-regions of North America (Mexico), the Caribbean, Central America and South America, with 33 independent countries.
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Peter Howard Wertheim & Dayse Abrantes - International Journalists
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