Category: Latin America Startups and Investing

Latin American Shipping: Opportunities for Startups

Category : Latin America Startups and Investing
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In 2014, the US government launched an initiative called “Look South” to show companies in the United States the benefits of shipping to the Latin American market. Despite numerous trade agreements between Latin America and the US, 58% of US companies at the time were exporting to only one other country: Canada or Mexico.

Latin America is a close US trading partner, yet the complicated shipping logistics in most Latin American countries – whether by air, water, or overland – are hurting the region’s supply chain.

The challenge of automating and streamlining shipping logistics in Latin America is becoming more pressing as e-commerce and other B2C delivery businesses take hold. Not only are large corporations dealing with sending and receiving bulk cargo across the region, but individual consumers want more on-demand services that require better organization and logistics.

Latin America still lags behind in the development of its shipping industry. The World Bank reported that in 2014, no Latin American country was in the top 25% of the Logistic Performance Index global rankings. In 2016, this figure hardly changed; Panama is the top-ranked Latin American country for logistics and shipping, yet it comes in 40th on the LPI global rankings. Chile is next at 46th, with Mexico and Brazil ranking 54th and 55th, respectively.

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The Funding Rounds of Latin America’s 9 Tech Unicorns

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Latin America’s tech ecosystem is maturing rapidly. 2017 was a standout year for foreign investment in Latin American startups, with investors in the US and China taking an interest in tech companies that are solving both local and global problems. Not only are the startups in the region becoming more numerous and innovative, but the older tech companies that started in the mid-2000s are reaching high valuations that allow them to compete globally.

Over the past decade, the number of tech startups reaching billion-dollar valuations, known as ‘unicorns,’ has grown considerably. At least nine of these unicorns were founded in Latin America, concentrated in Argentina and Brazil.

There is a lot to be learned from tech companies that can reach a billion-dollar valuation in a challenging market like Brazil or Argentina. What’s more, building a billion-dollar business in Latin America does not happen overnight.

Here’s a look at how each of Latin America’s billion-dollar tech companies reached their current valuations. (more…)

5 Habits of Exceptionally Successful Distributed Teams

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Not too long ago, teams almost always needed to be in the same physical location to work effectively. But today, it’s no longer unusual to work with team members spread across different time zones, countries, or even continents. In fact, remote work is on the rise, with more and more organizations opting for 100% distributed teams. Dell, Apple, U-Haul, Microsoft, and Buffer are just a few notable companies that have had a great deal of success operating with distributed teams.

Having the right communication and collaboration tools in place is vital to streamlining your processes as a remote team; however, managing a geographically dispersed team isn’t without its challenges. If you’re struggling to keep your team motivated and unified, there are ways to get your team back on track. I spoke to a few entrepreneurs to get their advice on how they’ve been able to manage their distributed teams successfully. Here’s what they had to say.

Create a repeatable onboarding process

When a new team member joins your remote team, it’s important to eliminate any feelings of isolation and set clear expectations from day one. Establishing an onboarding process is an essential part of this step. (more…)

Why Latin American Startup Valuations Have Been Lower than Silicon Valley Valuations

Category : Latin America Startups and Investing
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I wrote an article on The Next Web about a topic that comes up weekly at Magma Partners: valuations in Latin America. I hope Latin American founders take a look at this article before they start talking with venture capitalists, so that we can start a conversation. I also hope that more US, Chinese and Latin American investors get in the market, and that more US, Chinese and Latin American companies start making acquisitions so that this valuation gap can change. From the article:

Latin American startups haven’t had the same valuations as Silicon Valley startups. This frustrates many Latin American entrepreneurs seeking investment, as they don’t understand why Latin American VCs aren’t doing deals at Silicon Valley valuations.

There are important reasons why Latin American early-stage investment valuations are lower. For one, there are few acquisitions in Latin America, and when acquisitions do happen, they tend to be at lower valuations than their counterparts in other parts of the world. VCs need to make returns, or they’ll be out of business. Therefore, if exits are lower, the initial price that venture capitalists pay must be lower.

But what other reasons are there for this? Why are there still so few Latin American exits and why are they at lower valuations compared to their international peers? Here are just a few of the reasons.

Read the rest of the article 6 reasons why Latin American valuations are lagging behind Silicon Valley on The Next Web and if you have any feedback, would love to hear about it in the comments here.