By Robert L. Scheier
Sitting on the stage at MIT’s Wong auditorium, the first thing Fernando Fabre noted was that his panel of three entrepreneurs were the only speakers at MIT’s Latin American conference not to wear ties.
That wasn’t the only difference as Fabre, president of Endeavor Global, a nonprofit that aids startups worldwide, led the trio through a panel on “Entrepreneurship: Started in Latin America, for the World.” In a day full of sometimes weighty discussions of monetary and government policy, they showed by example how daring, speed, ingenuity and learning from failure can help growing Latin American brands go global.
Among their lessons:
Don’t Be Intimidated: When the then 18-year-old Andres Barreto, co-founder and president, Onswipe/PulsoSocial and co-founder of Grooveshark, was working on his first company he was “not in New York, not in Boston, not in the Ivy League,” but at the University of Florida in Gainesville. He used only social media tools such as blogs to promote the music sharing site, which “now has over 40 million users per month. If I can do such a company from the middle of a swamp,” he says, others can do the same from Bogota, Colombia or Buenos Aires, Argentina.
Nor do you need massive piles of venture capital, which in Mexico is hard to come by anyway. Barreto’s most recent startup required only $7,000 U.S. before it began generating revenue, It helps, of course, that he has an established PR and software services firm, of which 30 percent of the revenue goes “to experiment with new products.”
You can also do it, with local talent, he says, at least in Mexico where there is “no competition to get the really smart kids” because the only other opportunities “are to work for the government, Pemex (the state oil company) or IBM. He lures people by telling them that at one of his startups, “You can work on something challenging, that people will really use.”
Move quickly, fail often, move on: All three panel members stressed the importance of not being afraid to try, fail if necessary, learn quickly and move on.
Although he started out with no experience and no contacts, Barreto figured that, in the “worst case, I’d still have more experience than anyone else.” And as a political science major, he jokes, “the opportunity cost was not that big” if he failed. He stressed that, for all the successful companies he and his companions launched, there were “a bunch more we tried that didn’t work.”
“For the first few years, it was not more than me and the co-founders,” said Mario Schlosser, founder of online game provider Vostu. “We tried a social networking project, social apps, even a Web site for a Brazilian soccer club. The initial experimentation stage was very painful and extremely long, but it was very important.” Then a popular online fighting game from Germany caught their eye, and their own variation began their journey to today’s 50 million users.
Online tracking that let Vostu see how many people are playing various games is critical to rapidly launching and testing new features. “It’s the only way you can survive in this very cutthroat business of social games,” he says, “where new games are launched on almost a daily basis.”
No Whining: “Instead of complaining that there’s no startup culture in Latin America, I decided to change it, or do what I could to contribute,” said Barreto. “If you listen to an entrepreneur complaining, (he’s) not an entrepreneur,” said Martin Umaran, co-founder and acting COO of the Argentinean software development and IT maintenance company Globant. “If you’re complaining you don’t have time to work.”
“Having a dream is the most important part of the process,” said Umaran. But then there’s the matter of making money. Andres strongly suggested startups simplify the product as much as possible in one, or several, weekends of work and “and monetize it from day one.” Going global with promotion and delivery and payment channels, he says, is the only feasible way to accomplish that.