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Venezuela a Land of Opportunity for Innovators, Entrepreneurs Amid Technological Setbacks

The Founder Institute set up shop in Caracas last year and has made some surprising discoveries among the hundreds of people who apply to join its training programs

Venezuelans open technology hub in icon of the country's industrial heyday.
June 22, 2022 | 08:15 pm

Caracas — When the Founder Institute (FI), the world’s largest startup accelerator, set up shop in Caracas a year ago, its team in the country did not expect the high number of applications to be part of its acceleration program. A total of 168 people applied for the first round, from which nine entrepreneurs graduated, with eight of them formalizing the launch of their technology company in a hostile but hungry market.

E-commerce, marketplaces, edtech or fintech. The variety of business sectors was present both in the applications and at the moment of materializing their business models, accompanied by the Caracas chapter of the FI for guidance in the development process and in the search to raise capital.

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The hidden talent in technological matters in Venezuela was a surprising find for the directors of FI in Caracas, among them Sandy Gómez, an economist and specialist in valuation at Arca Análisis Económico, who after having managed to anchor the IF in the Venezuelan capital, in an organic way, has been impressed with the response from people regarding its presence, and how, in a complex economic context, with few guarantees, commitment is even greater.

In order to apply for the FI’s mentoring nd training programs, which last approximately four months, and two of which have already been carried out in Venezuela with expert training, psychometric tests are applied to evaluate the disposition of the entrepreneurs or future business leaders of technology companies, and their capacity to face a variety of obstacles.

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In Venezuela, where entrepreneurship has grown along with the crisis of necessity and the destruction of the formal job market, with a lifetime for businesses reduced to three years due to improvisation or lack of training, the FI, which is dedicated precisely to providing the right tools to deal with or avoid mistakes, has encountered a more conscious and rooted generation, and which sees in the Venezuelan market, which suffers from setbacks even in areas such as payment mechanisms, a perfect opportunity to innovate.

“There are many things that, to close the gap in the Venezuelan market, you can do by bringing best practices,” Gómez said in an interview with Bloomberg Línea.

“You don’t have to reinvent the wheel, and delivery is one of those areas; we didn’t invent it, it already existed in other places, but what happened is that we hadn’t found the formula to get into that market. And the second great catalyst is that when we moved to the multi-currency system, we don’t have the small denominations of bills for smaller payments, so the application solved that payment issue. These are problems that we still have in Venezuela and which are day-to-day problems, and which are likely to spread, and to which a solution can be found,” Gómez said.

In addition to the lack of technological advances in the country, which is just beginning to have new Internet access options via satellite link, there is another factor that, although is one of the most negative elements of the country’s economic crisis, is also a way of recognizing failures and not repeating them.

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“Venezuela has a peculiarity, when the country has gone through its bonanza cycles, all those mistakes are kind of swept under the carpet, because 30 years ago an entrepreneur of that time did not have to be a tech entrepreneur. They launched an initiative and went bankrupt, but maybe with subsidized credits, and in that case the scar does not hurt the same,” according to Gómez.

“There are many things that this generation does not have. It does not have credit. They are not going to make a mistake like that, and the other mistake would be new information about the ecosystem,” Gómez added, saying that, for this very reason, the FI’s support does not stop at the end of the training, but continues even until participation in the investment rounds is achieved.

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The accelerator, based in Silicon Valley and with a presence in 200 cities since 2009, is also recognized by Venezuelans in the tech world across the country, including in the more remote cities, who have a lot of experience in programming and work for large companies in the United States and the rest of the continent.

Marco Villegas, director of Arca Análisis Económico and co-director of FI Caracas, talks about the talent they have been able to identify among so many applications, and who, in addition to being grateful for the FI’s presence in the country, also see with enthusiasm the participation of Venezuelan experts among the mentors.

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“They have told us: ‘With this I feel like I’m helping Venezuela a little bit.’ With all the knowledge they may have, and are willing to contribute to the process, and it has been one of the best experiences we have been able to experience. Venezuelans in Google, in Meta, Amazon, or in the startups that are already here, are supporting the ecosystem,” Villegas says regarding the integration of facilitators in the accelerator programs.

FI is now moving toward a third round of courses in the South American country.

The sustainability of some of the ideas proposed in a market like Venezuelan is, of course, questionable, but the the IF delegation in Caracas says it prefers to focus on the strength of those who make the proposals, and their flexibility to mutate and support the ‘Venezuela laboratory’, with the aim of offering solutions, because once that happens, things will also become easier in other segments.