The innovative tech firms defining Colombia’s future are looking to invest in the U.S., and the best way to woo them is through capital and mentorship, the South American country’s ambassador said in Atlanta Tuesday.
Francisco Santos Calderón, a former vice president now posted in Washington, invited Georgia to set up a structured approach to connecting fast-growing Colombian firms with resources to help them grow globally.
“Venture capital in Latin America is hard to get. The culture of venture capital is still not there,” Mr. Santos said during a meeting with government and business leaders at the Metro Atlanta Chamber. “All of the companies I’ve talked to in Colombia have said, ‘Please bring venture capital here; we need that.’”
Colombia is fresh off the minting of its first tech unicorn, on-demand delivery startup Rappi, which announced in April an investment of up to $1 billion split between Japanese telecom giant SoftBank and its controversial Vision Fund. Rappi has ambitions of being Latin America’s super app — an e-commerce, delivery and payments solution wrapped into one.
Colombia is now seeing increased momentum in its entrepreneurial ecosystem, with educational technology and fintech as key sectors. Promising firms include Chile-founded OmniBnk, now growing rapidly in Colombia, and small-business lending platform Sempli, which has raised $24 million to date. The latter’s model seems similar to Atlanta-based unicorn Kabbage, which automates the underwriting process to help banks get new clients and companies gain quicker access to funding.
The problem, Mr. Santos said, is that few Colombian companies understand the U.S. market. They need hand-holding, especially around pitching investors here who may have an outdated view of Colombia.
The country’s 2016 peace accord may seem to be on shaky ground a glance, but the ambassador pointed to a stable democracy that has come a long way (with U.S. military aid) from its status as “almost a failed state” in the 1990s, the peak time for drug violence perpetrated by armed rebel groups.
Mr. Santos, who knows the troubles all too well as he was kidnapped during that time, said it took awhile for investors to give Colombia a second look. But the journalist-turned-politician-turned-diplomat said people finally began to pick up the phone a few years after he became vice president in 2002 under then-President Alvaro Uribe.
“I would say that if there is something that characterizes Colombian institutions, people, entrepreneurs, it’s resiliency. We were able to leave that past behind and give our citizens a greater future,” he said.
Colombians maintain faith in private enterprise despite some pockets of left-leaning sentiment at home and political turbulence in the region, he said, predicting a “great future” for Latin America. He noted Colombia’s standout 3 percent growth in a largely stagnant region, despite an influx of 1.5 million Venezuelan refugees that has put a burden on the economy.
Envisioning Colombia at the vanguard of Latin American growth is why the ambassador has signed partnerships with Silicon Valley accelerators like 500 Startups and others near the University of Texas at Austin, a growing tech hub.
“There is plenty more where that came from,” he said, urging Georgia not to waste its six-year head start as the only U.S. state with a trade office in Bogota. (New Jersey is soon set to follow Georgia’s lead.)
Officials from the City of Atlanta’s Office of International Affairs floated the idea of connecting to Colombia via the Atlanta International Startup Exchange, a one-week program that has seen 21 startups participate from Atlanta and its cities of Toulouse, France, and Newcastle, England. The inbound startups have come around Venture Atlanta, giving them an entree into the Southeast U.S.’s largest fundraising event.
Mr. Santos also suggested Georgia investors come down to Colombia before the next conference to gin up interest.
“It could be a fantastic way creating a huge tube of connection between Atlanta to Colombia and through Colombia to the rest of South America,” he said.
All along, the ambassador expressed his willingness to “open doors” both in the government and with private enterprise in a wide range of sectors represented at the breakfast, from telecom to oil and gas.
“That’s what I do, every day,” Mr. Santos said.
Future potential will be contingent on connecting dots. Some present at the event mentioned Georgia Tech’s Soft Landings program, a three-month course in the Enterprise Innovation Institute designed to help foreign companies avoid pitfalls when setting up their U.S. presence.
Unmentioned went some of the other tech assets like the fintech program of Georgia Tech’s long-standing incubator, the Advance Technology Development Center; Engage Ventures, which brings together Georgia’s Fortune 500 giants in a collaborative venture fund to back scalable ideas for early-stage innovators; and the local office of Endeavor, a mentorship program focused on entrepreneurs with high growth potential (which also happens to have offices in Bogota and around Latin America). Techstars, which started in Silicon Valley, is also here with its own accelerator program that has welcomed global startups.
That’s not to mention Atlanta’s position as “Transaction Alley,” the undisputed electronic payments hub of the U.S., and tech centers of gravity from the Atlanta Tech Village to corporate innovation centers cropping up around Georgia Tech.
Setting Georgia Apart With Agriculture, Logistics
But Mr. Santos didn’t limit his remarks to technology.
Georgia farmers and investors are also well positioned to fuel Colombia’s growth ambitions for crops like avocados and blueberries, which within a decade could rival entrenched products like flowers and coffee as export commodities, he said.
Citing conversations with California growers, he believes it’s only a matter of time before scarcity of land and water cause them to flock to what Colombia is calling the “last agricultural frontier” — about 25 million hectares (about 62 million acres) of largely untouched savanna and wetlands that would be ideal for forestry — another strength of Georgia.
“The biggest commodity in the world right now is land,” he said.
Georgia lags Miami in terms of recognition and relationships in the race for Colombian connections, but it has some logistical arguments in its favor, including a direct flight from Atlanta via Delta Air Lines Inc. and the Port of Savannah, which could process more flowers and produce now going to Florida.
The missing ingredient is engagement for changing that is deeper engagement, Mr. Santos said.
“I think Savannah is a port you have not sold,” he said. “I think nobody is competing with Miami. Nobody is saying, ‘Come on, we will work with you.’”
He also mentioned the potential collaborations in the film sector, which has been growing in Colombia since it modeled a production tax incentive program off of the one that has made Georgia one of the top filming locations in the world.
See the ambassador speak Wednesday at the Atlanta Council on International Relations: “Colombia – United States Relations: Today and Tomorrow”
Stay tuned for a Global Atlanta interview with the ambassador.