Why this investor abandoned setting up a startup fund in Chile(thenextweb.com) |
Why this investor abandoned setting up a startup fund in Chile(thenextweb.com) |
I get really sad when I see education policies just to increase the output nobel prize winners, no matter what. As if education and science where all about winning prizes that are highly political.
http://www.stlucianobellaureates.org/
This is quite impressive, but is more representative of how good the British system was at educating elites throughout the realm through their system of excellent local grammar schools feeding into the UK university system.
This hasn't translated so much to entrepreneurial success yet. Entrepreneurs in the Caribbean tend to come from the poorer less educated ranks or as immigrants. The successful intellectuals become European style public intellectuals or work in government.
Kingston Beta http://kingstonbeta.com/ is trying to change this culture by getting some of the extremely smart people in the Caribbean to focus on startups. I hope the best for them.
What I'm trying to say here is that education is not the only thing needed. Israel as he mentions has great universities, but it also has a completely different mentality to the mentality found in the middle classes in Latin America including Chile.
As a matter of fact many of the big success stories in China such as Wenzhou is founded on pure entrepreneurial spirit and has nothing to do with education:
http://reason.com/archives/2011/11/15/chinas-black-market-ci...
And that is exactly the point of Startup Chile. It is trying to change the mentality not of Chilean startups themselves (they are already on the program), but rather Chileans as a whole. The investors will come when the successful startups emerge. And don't count on local investors.
Local investors who have made too much money easily in an unrelated field are not good news. In Chile as he says it's from natural resources like copper.
We are fighting with this here in Miami as well. The local investors are not sophisticated enough to deal with early stage tech startups, yet there is plenty of money here. Much of the money made here was in real estate, hospitality and banking. Most people in the local startup scene are not looking for local money for that reason.
Morten Lund had a rant a few months ago in Danish http://lundxy.com/2011/08/i-have-to-get-it-our-in-danish-sor... about the Danish investors. It's much for the same reason, but with a special northern European twist. The Danish investment funds have virtually no former entrepreneurs on their boards. They consist of CEO's of large companies, trade union bosses and representatives from local government. All people used to easy money who haven't got a clue about entrepreneurship. Which is pretty much how you could describe the country as a whole.
Technically, one: http://en.wikipedia.org/wiki/Peter_Medawar
On superior education, Brazil wins slightly: http://www.topuniversities.com/university-rankings/latin-ame.... USP is also 100 positions ahead of Chile's PUC on the 2011 world university rankings.
Some of the issues cited are obvious even from researching at a distance, so it makes one wonder if he moved over without conducting basic research, just trusting that the govt invitation would make it rain? Where on earth can you expect to enter as a foreigner to raise a $40 million fund within 6 months with NO solid connections within the community or with capital providers? In a conservative environment to boot?
Now he says he wants to "help Chilean companies to invest in Asia" although he couldn't get Chileans to invest in Chile? 0_o
Other sides of the debate that I came across: Sarah Lacy http://www.sarahlacy.com/sarahlacy/2011/12/attention-world-d...
Nathan Lustig http://www.nathanlustig.com/2011/12/26/arnon-kohavi-chilean-...
Rich Yang http://thenextweb.com/la/2011/12/27/start-up-chile-entrepren...
if you wait for the entrenched families here to change, you will be waiting a long time.
But Chile's two Nobel Prizes are for Literature, which is cool but not very relevant to the author's point, so we're even.
In any case I'm not sure if even science Nobel prizes or top universities' rankings are very relevant indicators regarding web startups. Germany and Japan both have loads of Nobel prize winners and several excellent universities, but we don't see startup hubs in those countries comparable to Silicon Valley or even Israel (proportionally).
Well, if you were to assemble a small, elite team of programmers, arguably you'd have better luck in Brazil, or possibly Argentina, than in Chile, based on sheer numbers alone. On the other hand, I believe the average education in Chile is much better: for instance, literacy rate is 96.5% compared to Brazil's 90% (much less if we count functional literacy).
Overall, though, I believe Brazil probably is still the best place for investing in startups in South America. See 500 Startups for instance:
http://www.quora.com/Why-did-500-Startups-choose-Brazil (I don't completely agree with the top answer, which is a tad too generous to Brazil, but it is instructive.)
http://brazilventurecapital.blogspot.com/2011/09/dave-mcclur...
Anyway, the problems he describes are very real here in Chile, but at least we're outgrowing that. There are big bottlenecks in the way (not enough people is english-literate and not-elite education is terrible) but the will to change is there.
> Nothing will change without emphasis on science, and this is true all across Latin America – actually, Chile is even in better shape than other Latin American countries. Do you know how many Brazilians have received a Nobel Prize? Zero. Compare that with Israel, and you’ll see the difference: education.
But I agree with you, I don't think one investor giving up on Chile means anything definitive about the country's potential.
I know they were raided, i know the SII visited a lot of people at 2am asking for data. Some journalists from Canal 13 did a note about that but never got broadcasted.
They learned that they aren't going to be on TV because they are less rich and less powerful than people who wanted the plant. That knowledge made them to ask for help to some actors and then, using internet, the campaign was made public.
The sites chaopescao.cl and salvemospuntadechoros.org were asked by phone to be removed and hosting company agree with that...
I created myself an account on hn just to tell you that this maybe is not a common politics, but it still happening, specially away from santiago. You don't have to belive me and say this is what happens in chile, but it will be more than cool to keep your mind open to notice when this happens, and confront it and make it public.