Argentina Startup Scene is a funny story. It has been the innovation hub of Latin America for a decade despite a strong economic crisis that still has consequences as we’re speaking.
Today, the competition for being Latin America’s most attractive tech scene is growing, even nearby, in Chile. But Argentina could remain the central hub of Latin America thanks to a whole network of talents and investors, created around the success of some tech companies in the early 2000’s, notabily MercadoLibre, Despegar.com and Globant, a software development firm which successfully launched an IPO in the NYSE. The old startup scene helps the new one, it made possible the creation of the leading private accelerator of the whole continent, Nxtp Labs.
It could as well remain a story between argentinians only. Very few are the incentives for international startups, entrepreneurs and investors to come to Argentina. The economy is highly instable, and has coped with hyperinflations many times, even lately. The protectionist governement fixed an artificially high change rate, leading to the creation of a large black market on international currencies. Yet businessmen must deal with the official rate which makes everything more expensive than it should be on the international market.
Entrepreneurs also need to comply with the importations restrictions. And even if they do comply, they’d better know the money made from any investment in Argentina cannot be taken out the country without paying a prohibitive fee, nore can it be changed in dollars or euros. In practice, an investment made in Argentina, whether a startup or a house, will stay in Argentina. Add to this a corrupted administration, a strong legal uncertainty, and a tendency to mistrust, and you get quite a nasty picture of Argentina.
But far from stoping entrepreneur to undertake, such complexity is said to stimulate and strengthen them. In order to make it, they must deal with problems few people know. It was true for the group of successful entrepreneurs of the late 1990’s early 2000’s, whose success story stem from a financial crisis of several years. And it is likely to be true even today, especially considering argentinian entrepreneur think about going worldwide from day One.
We won’t say Argentina is to avoid because of reccurent financial issues. It is definitely a complex country, but it is also one thriving innovation place to look at in the future.
PROS
- Historical innovation hub of Latin America
- Buenos Aires is the HQ of the largest tech companies in Latin America
- The old startup scene is helping the new one
- Talented engineers and entrepreneurs
- Thriving startup economy
CONS
- Highly unstable economy
- Corruption (ranks 107 on 174 in Transparency International Corruption Index)
- Recurrent trust issue
- Strong bureaucracy
- High taxes on international activities, especially investments
TOP STARTUPS IN ARGENTINA
This software development company registers about USD 200 millions in sales, and launched an IPO at NYSE in 2014.
E-commerce and online auction platform. One of the largest internet companies in Latin America with over USD 470 millions of revenues.
Spanish speaking social network, mainly used in Latin America. With 27 millions users, it ranks 681 in Alexa’s list.
Mural.ly is an online brainstorming, synthesis and collaboration tool. The project started during a StartUp Weekend.
TOP PEOPLE TO KNOW IN ARGENTINA
Martin Migoya
CEO and co-founder
Globant
As the CEO of Globant, he is one of the most successful tech entrepreneur in Latin America.
Martin Vivás
Global Facilitator
StartUp Weekend
Martin is a startup mentor in Argentina (Nxtp Labs, StartUp Weekend) and beyond (Innova Bolivia).
Matías Bari
CEO and co-founder
SatoshiTango
Matías is an argentinian bitcoin entrepreneur, dedicated to make bitcoin easier for the average internet user.
Andres Chomczyk
Legal Officer
Bitcoin Argentina
Member of the commission on legal matters at Bitcoin Argentina foundation.
Marcos Galperin
CEO and co-founder
Mercado Libre
Marcos Galperin founded Mercado Libre in 1999, now one the largest internet company in Latin America.
Roberto Souviron
CEO and co-founder
Despegar.com
Roberto Souviron founded Despegar.com while he was finishing an MBA in the USA. It is now the first online travel agency in Latin America.
ARGENTINA
| GDP (in billions USD): | 610 |
| GDP per capita (in USD): | 14,715 |
| Population: | 41,450,000 |
| Population in 2050 (est.): | 53,511,000 |
| Internet Penetration: | 60 % |
| Mobile Penetration: | 163 % |
| Banking Penetration: | 50.2 % |
| Credit Card Penetration: | 44.2 % |