By Bernardo Arrospide
Latin America is currently experiencing a technology boom that is disrupting traditional industries across the region. While Internet penetration is just beginning to reach the masses in countries such as Peru and Colombia, start-up ecosystems have already sprung up in Brazil, Mexico and Chile. A rising middle-class with access to new technologies is providing the opportunity for entrepreneurs to arbitrage successful business models from developed markets, or, to develop entirely novel businesses tailored for the region. As a first year MBA student originally from Peru, I decided to forego the traditional internship path to try and build a new business in South America.
In September 2011, the Economist published an article titled “Man’s Best Amigo” about the emerging Latin American pet care market. I had been looking for the right idea for a business in South America and finally felt I’d found it. In a stroke of luck, my fellow MBA learning team member, Benjamin Lewis, was also a Penn veterinary student and a serial entrepreneur. We teamed up and began developing a business plan for a Brazilian pet care e-commerce business.
After several pivots, we are now on the verge of launching 4Vets.com.br: an online veterinary supply business for Brazil. We were able to reach this point by boot-strapping in part thanks to the Chilean government, which provided us with a $40,000 equity-free grant via its Start-Up Chile incubator. Launched in 2010, this program seeks to bring entrepreneurs to accelerate their start-ups in Chile. In exchange, the program asks participants help develop the local start-up ecosystem through community actions such as organizing meet-ups for entrepreneurs, mentoring local students and speaking at universities.
Although initially Ben and I were skeptical about moving to Santiago to work on a start-up focused on Brazil, we have been extremely satisfied and grateful for the experience. Start-Up Chile has already incubated three classes of 100 global start-ups and understands how to work with entrepreneurs whose primary market is not Chile. In fact, the program seeks to bring as many global entrepreneurs as possible to create a truly international network.
There are two unique ways in which start-ups can leverage their time in Chile. The first is to utilize the local market as testing grounds for a global product. A great example of this is SaferTaxi, a taxi-ordering service similar to Uber, but focused on Latin America, which was started by a group of HBS MBAs. Last summer SaferTaxi tested its app successfully with Chilean taxis, streamlining their system before rolling it out to larger cities such as Buenos Aires. Today SaferTaxi is venture-backed and headquartered in Sao Paulo. A second way in which Chile can add value is by leveraging the local community. Working in proximity to hundreds of entrepreneurs has been invaluable for us. Through the program, we were able to find experienced e-commerce developers who guided us on how to develop an online B2B platform cheaply and efficiently.
Besides the advice provided by Start-Up Chile, we have also continued to leverage Penn’s resources. Lippincott library gave us access to key market research reports, even for niche areas such as pet care on Latin America. Meanwhile,Brazilian MBA students helped us contact dozens of veterinary clinics across Brazil. Finally, Wharton’s network of entrepreneurs in Brazil has provided us with consistent advice and encouragement. Entrepreneurs like Davis Smith of baby.com.br and Pete Ostroske of oLook.com.br have literally blazed the trail for foreign MBA students launching start-ups in Latin America.
After several months in Brazil and Chile, I continue to feel that Latin America provides an incredible opportunity. While bureaucracy, regulation, corruption and underdeveloped capital markets remain a huge challenge; I believe that entrepreneurs with the right networks and ideas can be successful. Penn and Wharton give students a great network for navigating these challenges while Start-Up Chile provides a fantastic venue to incubate an early-stage idea. If you find yourself watching the Latin start-up boom from the sidelines and want to get involved, the resources are readily and absolutely at your disposal. All you need is a dream and the will to act upon it.
Bernardo is an MBA student at the Wharton School and co-founder of 4vets.com.br: a B2B e-commerce supplier of veterinary products for clinics, pet shops and animal hospitals in Brazil. Previously Bernardo was the Chief of Staff to the CEO of the Medicines Company, a billion-dollar market cap biotech business where he was responsible for establishing the firm’s operations in Brazil. Bernardo holds an AB in Economics from the University of Chicago. You can follow Bernardo on Twitter at https://twitter.com/thearrospider and sign up to receive info on 4Vets launch.