Latin Finance - July/August 2011 - 23

latam tech investing

Where’s the Exit?

But significant barriers to increased IT investment still remain, according to Mauricio Bejarano, chief of sta to former Colombian vice president Francisco Santos. Bejarano is now an angel investor in Colombian IT companies. “In Colombia at least there’s huge missing gaps in venture capital. There are very few angels. If you talk to them about exit strategy they don’t know what you’re saying,” Bejarano says. In Europe and US, many tech companies are traditionally founded as start-ups backed by venture capital funds. “The primary thing Latin America could do to facilitate venture capital and private equity activity around the sector is work on the capital markets,” says Gertsacov. “There’s no exit. IPOs are few and far between. The mergers and acquisitions stu usually happens between the big family groups and the big [corporations].” It’s a problem that’s being seen in several countries. “We think that’s a problem in the region, especially

in Colombia,” says Francisco Mira of Promotora, a VC firm focusing on Colombian tech companies. Mira says Promotora solves the issue by investing in companies that make good potential targets for global strategic investors. “For example, Spanish strategic investors are looking for new technologies to be included in their portfolio, or are looking for companies that could develop their own technologies here in Colombia at a lesser cost.” Mira says the best solution may be the development of new bolsas. “We have to develop secondary stock exchanges that allows this kind of company to go public. Like a Nasdaq.” But there are signs things may be improving for investors looking for exit opportunities. “We have been doing exits the last four years,” says Intel’s de Paula. “We have lots of large corporations around the globe that are interested in Brazil and are doing acquisitions. And you have the local markets doing IPOs.” De Paula says he sees this trend spreading outward from Brazil to some

of the countries in the region with smaller capital markets. “I think Brazil is a little ahead of the pack,” he says. “But I can see this [sales to global strategic companies] happening in other countries as well. I think we’re going to see more and more this type of exit opportunity in the region. It’s improving a lot as time passes.” Outside of Brazil, the lack of capital markets has been problematic, Bejarano says. But some countries are looking to step into the breech. Chile, for example, launched Start-Up Chile last year, a government program looking to spend $40 million funding entrepreneurs, according to Nicolás Shea, CEO of the program. Half of the funds awarded so far have gone to tech companies, he says.

Strategics to the Rescue

“Potential buyers are back at the table and looking for countries in Latin America,” says Ariel Muslera, director of strategy and product development at LAVCA. “Brazil, Chile, Colombia, Peru . . . those countries are back on the top of the minds of large companies as a place where they can find

July/August 2011

LATINFINANCE 23



Latin Finance - July/August 2011

Table of Contents for the Digital Edition of Latin Finance - July/August 2011

Latin Finance - July/august 2011
Contents
Debt Fund Manager Survey
Equity Fund Manager Survey
LATAM Tech Investing
Central Bank Policy
Centam Energy
Mexican Airlines
Mexican Renewables
Peru Agriculture
Corporate Sustainability
European Private Equity
Parting Shot
Latin Finance - July/August 2011 - Latin Finance - July/august 2011
Latin Finance - July/August 2011 - Cover2
Latin Finance - July/August 2011 - Contents
Latin Finance - July/August 2011 - 2
Latin Finance - July/August 2011 - 3
Latin Finance - July/August 2011 - 4
Latin Finance - July/August 2011 - 5
Latin Finance - July/August 2011 - 6
Latin Finance - July/August 2011 - 7
Latin Finance - July/August 2011 - 8
Latin Finance - July/August 2011 - 9
Latin Finance - July/August 2011 - Debt Fund Manager Survey
Latin Finance - July/August 2011 - 11
Latin Finance - July/August 2011 - 12
Latin Finance - July/August 2011 - 13
Latin Finance - July/August 2011 - 14
Latin Finance - July/August 2011 - 15
Latin Finance - July/August 2011 - 16
Latin Finance - July/August 2011 - Equity Fund Manager Survey
Latin Finance - July/August 2011 - 18
Latin Finance - July/August 2011 - 19
Latin Finance - July/August 2011 - 20
Latin Finance - July/August 2011 - LATAM Tech Investing
Latin Finance - July/August 2011 - 22
Latin Finance - July/August 2011 - 23
Latin Finance - July/August 2011 - 24
Latin Finance - July/August 2011 - 25
Latin Finance - July/August 2011 - Central Bank Policy
Latin Finance - July/August 2011 - 27
Latin Finance - July/August 2011 - Centam Energy
Latin Finance - July/August 2011 - 29
Latin Finance - July/August 2011 - 30
Latin Finance - July/August 2011 - 31
Latin Finance - July/August 2011 - Mexican Airlines
Latin Finance - July/August 2011 - 33
Latin Finance - July/August 2011 - 34
Latin Finance - July/August 2011 - 35
Latin Finance - July/August 2011 - Mexican Renewables
Latin Finance - July/August 2011 - 37
Latin Finance - July/August 2011 - 38
Latin Finance - July/August 2011 - Peru Agriculture
Latin Finance - July/August 2011 - 40
Latin Finance - July/August 2011 - Corporate Sustainability
Latin Finance - July/August 2011 - 42
Latin Finance - July/August 2011 - 43
Latin Finance - July/August 2011 - European Private Equity
Latin Finance - July/August 2011 - 45
Latin Finance - July/August 2011 - 46
Latin Finance - July/August 2011 - 47
Latin Finance - July/August 2011 - Parting Shot
Latin Finance - July/August 2011 - Cover3
Latin Finance - July/August 2011 - Cover4
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