Smooth Sailing Ahead for Mexican Start-Ups, Local and Foreign Investors Celeste North - Emprende.la
go to original August 21, 2012

When it comes to entrepreneurship, the big news in Mexico lately has certainly been the merger of MexicanVC and 500 Start-ups.  In prior posts, we looked at how, from the time it started operations a little over a year ago, MexicanVC has been one of the country’s most important accelerators.

Founded by David Weekly, Santiago Zavala and César Salazar, MexicanVC made waves from the beginning.  It seemed as if a coalition of start-ups not unlike the culture of Silicon Valley would soon form.  The company started with a boot camp in La Bahía and ended with a Demo Day in San Francisco, hosting several hackathons and intensive project mentoring sessions in between.

The talks between 500 Start-ups and MexicanVC became more evident when Yogome and Fontacto, two fledgling companies, were invited to continue their formation in Mountain View as part of 500 Start-ups.

On the one hand, this decision strengthens Dave McClure’s goal of more international investments, which today account for 10% of investment activity.  On the other, the move opens several areas of opportunity and change for Mexico, which will spur the growth of local start-ups.

More foreign investors will see Mexico as their next opportunity.  This will mean more frequent and larger investments, which will in turn prompt local investors to move faster and invest more in technology.  It won’t be easy at first, but in the end money will be moving and start-ups will be taking root and experiencing rapid growth.

It is important to emphasize that other investors and organizations that follow McClure will need to ally with local groups in order to better understand the local market.  That will prevent misunderstandings due to differences between Mexican and North American culture.

Nevertheless, investing in Mexican start-ups is considerably easier for US investors, since salaries for developers and designers aren’t generally too high.  This opens the door for higher potential earnings or less significant losses.

These developments will also create a wider variety of options for entrepreneurs, everything from angel investors and local VCs to big-name investors who will cover a start-up from inception to the start of operations, something that isn’t too common in Mexico yet.

Over the last two years, the number of options for incubation and seed capital for tech entrepreneurs has grown, from private initiative to public.  However, there will soon be a more frequent need for money for growing start-ups.

All this is not only good news for the companies MexicanVC helps get off the ground, but for the entire industry.  The eyes of local and foreign investors will look to Mexico as one of the best places to grow a business, find talent and invest.

@celestenorth

We invite you to add your charity or supporting organizations' news stories and coming events to PVAngels so we can share them with the world. Do it now!