Introducing Magma Partners: My New Seed Stage Fund in Chile

I’m excited to announce a new project I’ve been working on for the past six months: Magma Partners, a new seed fund in Santiago, Chile that invests in startups and high potential small businesses. Along with two Chilean partners, Francisco Sáenz and Diego Philippi, we’ll invest $25,000-$75,000 in 8-10 high potential entrepreneurs each year for the next three years. Some press: Andes Beat (en), Fayerwayer, Diario Financiero, Pulso Social, Pulso Social (en).

Our goal is to then provide follow on investments in the successful companies. We held our launch event last night where we announced the fund and our first two investments and it was a great time.

I’m excited to announce  our first investment, Propiedad Fácil, a property portal and real estate service provider in Chile. I think Magma Partners represents an opportunity to help keep the Chilean entrepreneurial ecosystem’s momentum going since the Startup Chile burst onto the scene in 2010.

Ever since trying to raise money for Entrustet in Chile in 2011, I’ve seen an opportunity for a Chilean early stage seed fund that operates using best practices from the United States. Chile is a very conservative country, so most investors still treat startup investing as if they were investing in a bakery or a bank and try to get as much equity as possible in the first capital raise, killing startups in the process.

I strongly believe that a higher percentage Chilean entrepreneurs fail than they should because the nascent Chilean entrepreneurship ecosystem lacks high quality mentorship, people willing to connect startups to existing businesses and access to capital using US industry standard terms. The best Chilean entrepreneurs get their start and quickly move abroad to find funding.

Our fund aims to fill the niche of high potential entrepreneurs who are starting their business in Chile with the goal of expanding across Latin America. We promise to be transparent, use US industry standard terms, give real mentorship and help you connect with potential clients and investors in Chile, Latin American and abroad.

But we’re aiming much higher. One of the things that I like about Chile is that it’s small. With about 17m people, you can have a nationwide impact fairly easily. Our plan is to not only help the entrepreneurs we invest in, but also to be a real help to those who we can’t invest in. I believe that if we execute our plan, we may be able to change the culture in Chile.

We’ve partnered with the Kauffman Mindset program to give mentorship to both companies that we invest in and Chileans who are interested in starting a business.

If you’re an entrepreneur with a business based in Chile who’s looking for funding, please check out our site, fill out our application form and a partner will get back to you within 48 hours with a “no, it doesn’t meet our criteria and here’s why” or a “yes, we’re interested, lets set up a meeting!”