I have a number of interesting insights regarding LATAM and Israeli start-ups. I will refer to a couple of them, based on my experience as a judge in the contest for start-ups conducted by MATI, Israel Conference for Digital Marketing.
Last month, the MATI conference was conducted in Tel Aviv with speakers from all over the world. The conference sponsored a contest for digital marketing start-ups, in which P-Ecosys invited LATAM start-ups to participate. I would like to share with you some insights from this contest and include some information about digital marketing in LATAM.
During this contest, I had the chance to experience LATAM start-ups as they were measured against their Israelis and American counterparts. I must say that this was the first time that LATAM start-ups were invited to participate in this kind of contest in Israel.
In only a few days, more than 70 LATAM start-ups approached the contest from Argentina (nxtp and endevour), Chile (Chile global), Mexico (through INADEM and Tics of America) and Colombia (through Tics of America). LATAM’s hunger to be part of what is happening in the “Start -Up Nation” was probed, which by itself is interesting. This hunger stems not only from the companies themselves, but from both public and private institutions as well.
The high number of applications gave us the opportunity to analyze what kind of companies were applying and what areas are they were approaching. Applicants included social oriented start-ups, education start-ups, ecologically oriented ventures, security an e-commerce companies and a few digital marketing companies as well.
A pre-selection left us with roughly 50 start-ups that answered the participation criteria.
As for the 50 start-ups that applied from LATAM, only one of them was part of the 14 selected for the finalist step and was interviewed via Skype. At the pre-final level, we applied three criteria: innovation, technology and business models. The selected start-up from Argentina was relevant only in one of the three criteria: the business model.
Let me elaborate: technologically speaking, all of the LATAM start-ups were far behind Israel. By this I refer to the kind of algorithms used, the new forms of digital marketing analysis and new digital solutions offered to huge digital marketing companies. But regarding business models, LATAM start-ups were able to compete with the Israelis and Americans.
A very interesting point relates to the innovation parameter. During the contest, it became very clear to me that the innovation concept in Israel and USA is very different from the innovation concept embedded within LATAM’s start-ups. What is defined in Israel as innovation does not have the same meaning for LATAM’s start-ups.
For Israeli and American start-ups, innovation aligns, in most cases, with Steve Job’s words “Innovation distinguishes between a leader and a follower”, which can be understood as adding something new to the edge of knowledge. In LATAM, neither the technology nor ideas are the secret ingredient, but the ability to identify a potential market or a need.
For LATAM’s start-ups, innovation means adding something new to the prevailing conditions, even if this new element is already known within other latitudes but for any reason has not been yet incorporated on a daily basis.
This means that there exists a huge potential for LATAM’s start-ups to incorporate their own form of innovation, in that way they may profit from existing knowledge and then ease the learning curve.
But before concluding this point, let me share with you some info graphics* about LATAM’s digital market. When referring to digital markets, it has to be clear that Latin America’s internet population is the fastest growing in the world:
In Latin America, digital markets are at the “must have” stage, which is transforming the off-line market to an on-line market. Leading this transition are consumer brands, the media and commercial banks.
Furthermore, online transactions for retail channels are growing at the same levels as in the rest of the world. In this regard, 3.5% of global e-commerce will come from LATAM, while projections done during 2013 indicated that e-commerce operations would be worth 69 billion dollars.
To conclude, digital market in Latin America is a huge opportunity. LATAM start-ups are aware of this, and have very interesting business models that will be implemented within the coming year.
The opportunities embedded within LATAM markets are derived from its virgin nature, as well as from the vast amounts of information that developed countries are sharing and that “Latinos” are adapting as a “me too” strategy. Simply put, this strategy means:
a) A more rapid learning curve
b) A much smaller investment
c) A mature market for “innovation” adoption
d) A huge market to waiting to be discovered
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