Five Latin American and Caribbean countries stand out in the startup ecosystem

The 2021 annual report by the Global Entrepreneurship Network platform and the Start Genome project released the Global Startup Ecosystem Report 2021, the most comprehensive and widely read research that analysed 280 ecosystems and registered more than three million startups.

Startup is a term used to define companies that are young or recently created and have a high probability of growth due to their business models, innovation and digital immersion.

Among the main criteria for this ranking, startup ecosystems are classified in seven success factors, with the most relevant being tax incentives for companies that generate intellectual property and the academic background of the workforce in the cities, including performance and talent. The report also highlights 140 leading ecosystems in the world, including five countries in Latin America and the Caribbean: Brazil, Mexico, Colombia, Argentina, and Chile.

Sao Paulo's vibrant entrepreneurship and innovation ecosystem is getting more international investors to set their sights on the country's startups. According to KPMG, Brazilian startups raised a record US$ 2.7 billion in the second quarter of 2021 as it is the South American home of tech powerhouses such as Google, Uber and Airbnb, and digital banks are growing at an average rate of 147% annually in Brazil.

Colombia ranks as the 32nd largest market for e-commerce globally with total revenues of US$6 billion from startups in that country. Rappi raised US$ 500 million at a valuation of US$ 5.25 billion in July 2021. Bogota has one of the largest workforces in Latin America, with 6.3 million economically active workers and 2.5 million people aged 15-28.

In Chile, the number of Fintech startups increased by almost 60% between July 2019 and March 2021. The LATAM platform raised US$ 60 million in June 2021, and the number of digital technology startups applied to agriculture increased by 144% between December 2019 and July 2021.

In Argentina, startups providing financial services are growing rapidly, as the country has a high level of distrust in the traditional banking system. Nearly half of the population is unbanked or has no access to banking services. Among notable startups is the free mobile banking company Uala, which has raised a total of US$ 544 million.

Jonathan Ortmans, founder and president of Global Entrepreneurship Network, says that “it is encouraging to see a growing democratisation of entrepreneurship, with emerging ecosystems climbing the rankings as others join it for the first time.”