The VAT Trap: Why Is Chile’s VAT System So Poorly Setup?

Category : Chile, Entrepreneurship
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Chile’s VAT system doesn’t make sense. Once you are in the system, the reporting system is world class and has been ranked in the top five in the world for ease of use. The Chilean IRS’ website works incredibly well, is fast, reliable and makes paying your taxes a breeze. It blows the US system out of the water and it’s not even close.

But getting legally approved by Servicio Impuesto Interno (the Chilean IRS) is a bureaucratic, capricious, time consuming process that doesn’t make any sense. After the long and complicated process to incorporate and get a bank account (that I’ve talked about before), you need to get your boletas (receipts) and facturas (official invoices) so that you can legally sell and pay your taxes. (more…)

Full Stack Startups in Latin America are a Massive Opportunity

Category : Chile, Entrepreneurship, Latin America Startups and Investing
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Latin America is the perfect market for full stack startups. I’m convinced of it after living and working in Latin America for the past four and a half years and am even more convinced after having met, worked with and reviewed over 600 startups in the past year and a half as managing partner of Magma Partners in Santiago, Chile.

So what is a full stack startup and why am I convinced that Latin American entrepreneurs should be exploring full stack startup business models?

First, lets start with a definition. Chis Dixon coined the term Full Stack Startup in a blog post in March 2014. He says that a full stack startup is a  “…complete, end-to-end product or service that bypasses existing companies.” It bypasses the old, existing hierarchy to be able to control the entire experience. According to Dixon:

Prominent examples of this “full stack” approach include Tesla, Warby Parker, Uber, Harry’s, Nest, Buzzfeed, and Netflix. Most of these companies had “partial stack” antecedents that either failed or ended up being relatively small businesses.

So why are companies following the full stack method instead of the old school method of partnering with large companies? (more…)

Chile Restaurant Guide: Best Restaurants in Chile

Category : Chile
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I’ve lived in Chile for four and a half years now and have had an ample chance to sample Chile’s many restaurants. Although Chile’s restaurant scene has made incredible strides since 2010, unlike places like New York City, San Francisco, Buenos Aires or Madison, Wisconsin, Chile isn’t a place where you can walk into a random restaurant and find a great meal.

The average Chilean restaurant isn’t that great. You’ll likely end up with some meat and potatoes with little flavor, low quality food or overpriced fare with little connection to value for money. I’ve created a list of the restaurants that I actually like and go to regularly. Please enjoy my favorite restaurants in Santiago and Chile.

I’m always looking for new restaurants to add, so please post any ideas or feedback in the comments! (more…)

Impunity and Vautrin’s Law in Chile and the US

Category : Chile, Personal Thoughts
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I’ve noticed an interesting phenomenon as I’ve worked in Chile more deeply over the past two years building companies. Many, if not most, Chileans believe they don’t have much influence on events in their lives and in their country.

I see it all the time in multiple contexts: business, politics, customer service and corporate bureaucracy. I’m very familiar with this feeling in politics, as I feel the same way about non-local US politics, but at first I didn’t understand it in the other contexts.

For example, in business, if Chileans get screwed over, they are less likely to take to social media or write a blog post detailing their experience than people in the US are. When there was an issue with a Chilean business incubator, it festered for months before a foreign entrepreneur shared his experience and only then did nearly a dozen Chileans corroborate their experiences. I asked some of the Chilean entrepreneurs why they hand’t said anything before, and they all said that they didn’t think they could do anything to fix the situation and that they didn’t want to rock the boat. (more…)