Resident Advisor at Able
Gonzalo Villaran is a pioneer of the startup ecosystem in Lima, Peru. He led the creation of the first business angel network in Peru (Peru Capital Network), managed the first accelerator (Wayra Peru), and has been instrumental in the advancement of public policy at a national level. Gonzalo continues to help grow the Peruvian tech community, leading research and programs around the development of an ever evolving and inclusive ecosystem.
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Disclaimer: all content within the Startup Ecosystem Summary and Editor’s Guide sections is written by and reflects the personal perspective of the guest editor. The guest editor is not responsible for content within the Country Snapshot and Community sections, as much of this content is compiled from external sources and does not necessarily reflect the guest editor’s view.
The economic success of Peru in recent years (25 years of continuous growth at an average rate of 4% per year) has been fundamentally supported by its main extractive industries (mining, energy, fishing) and lately by the growth of agro-industry. This has led the country in a virtuous cycle where service and commerce industries have seen a growing internal demand. This internal demand is today encouraging the creation and growth of startups that provide services to industrial sectors and products to the consolidating middle class in Lima, a coastal city by the Pacific Ocean made up of 10 million people. Lima is a strong testing ground and has the potential to be a great startup hub.
Although Peru came in late to the startup game, public policy agencies have been able to learn from neighboring countries, especially in the Alianza del Pacifico, and applied the ones that made sense for the local ecosystem. Therefore, the startup ecosystem in Peru has grown fast and in the right direction. In that sense, Startup Peru (SUP), a government program that provides seed funding for startups and funding for other stakeholders of the local ecosystem, has been a key actor for investment in the ecosystem. For every dollar invested through SUP, 3 dollars are invested from private stakeholders (accelerators, angels, VCs, Corporate VCs).
The appetite for startup investment is growing in Peru, with an increasing number of investments in startups happening every quarter. In 2018 and 2019, SUP provided funding to 109 and 84 local startups respectively, while in 2018 there were 24 private investment deals adding US$9.1 million dollars; in Q1 2019 there have already been 12 deals adding US$6.6 million dollars with more than 60% of those funds coming from international investors. Peru is also in a good position to receive international entrepreneurs through the Startup Peru Plug program, where they can receive public funding (no equity) and access to the local ecosystem through the network of accelerators that are part of SUP. Most of the startup activity happens in Lima, although cities like Arequipa, Trujillo and Piura have proven to foster very good talent.
Lima’s startup ecosystem is in an initial growth stage, with regular ecosystem events happening every weekend led by the ever expanding group of founders and ecosystem leaders. Support comes in diverse ways with initial funding from government and incubators or accelerators that are present (by law) in every university. The startup community is also supported by entrepreneurial groups that are keen to communicate activities happening in the ecosystem (i.e. Peru Emprende, a network of actors of the ecosystem that hold biweekly meetings). Events like the Peru Venture Capital Conference (held every last quarter of the year) gathers between 700 and 900 entrepreneurs, investors and corporations that gather to meet and listen to international speakers/founders share some of their wisdom.
The sum of these and other initiatives has set the stage for an ever growing number of young entrepreneurs applying their ideas in the market and forming new startups constantly. As an example, more than 1 000 teams applied for government funding in 2019, and only around 80 will receive it.
A key opportunity for the ecosystem is to focus on some of the comparative advantages that Peru has, for example around biodiversity. The growing number of agritech companies working with agroindustrial corporations is a good sign of the collaborative culture that the local ecosystem is showing. Examples are also found in the fintech and edtech sectors.
Editor’s choice of the industries with the most potential for technology disruption and growth.
Editor’s choice of the country’s top 10 emerging tech startups.
Editor’s pick of which ‘Featured Startup’ is especially worth following and why.
Editor’s perspective of the maturity level of talent in the ecosystem.
Editor’s commentary on how the country’s culture and history have impacted the ecosystem.
The roots of entrepreneurship in Peru can be in part attributed to events that changed the country in the early 1980s. Terrorism from extreme leftists movements against Peruvians in the Andes led to a massive migration to the capital, Lima. Available jobs were not sufficient as the Peruvian economy was in deep trouble with hyperinflation from bad economic policies, so a perfect storm was set for entrepreneurship as a livelihood.
Today things have changed in the country. The economy is booming and security concerns are not related to terrorism anymore. In fact, entrepreneurship is rising and some of our foremost artists (chefs–Lima is known for its amazing food) have become some of the best entrepreneurs in the country, leading to the creation of Peruvian multinational corporations that are top rated in the world. The challenge becomes translating the Peruvian entrepreneurial spirit to technology advancement.
Interested in becoming more involved in this ecosystem and connecting with local ecosystem leaders? Let us know.
Angel Ventures (Lima): An industry agnostic firm investing in seed stage and Series A stage companies. (Source: Angel Ventures)
Capia Ventures (Lima): An industry agnostic investor funding Series A stage companies. (Source: Capia Ventures)
Endeavor Catalyst Peru (Lima): Catalyst is Endeavor's investment fund designed to support Entrepreneurs during their financing rounds, contributing to the long-term sustainability of the organization. In addition, it invests jointly with venture capital funds and individual investors in the capital raising rounds of Endeavor Entrepreneurs. (Source: Endeavor Catalyst)
INCA Ventures (Lima): A Peru based Venture Capital fund affiliated with Inca Investments. (Source: INCA Investments)
Outbound Ventures (U.S.): A seed fund focused on consumer startups and companies in the Edtech sector. (Source: Outbound Ventures)
PAD - Red de Inversionistas Ángeles (Piura): An angel investor network associated with the Universidad de Piura. (Source: PAD - Red de Inversionistas Ángeles)
Salkantay Partners (Lima): An investor focused on education, technology and other high impact sectors. (Source: Salkantay Partners)
Winnipeg Capital (Lima): An institution led by Milko Ibanez with business units in the areas of Corporate Finance, Asset Management, Capital Markets and Multi-Family Office. It focuses on Edtech companies and typically invests at the Seed stage. (Source: Winnipeg Capital)
BioIncuba (Lima): The incubator of the Peruvian University Cayetano Heredia. (Source: BioIncuba)
EmprendeUP (Lima): An incubator associated with the Universidad del Pacifico. (Source: EmprendeUP)
Endeavor Scale-Up Peru (Lima): The Scale-Up Program seeks to select, support and accelerate technological enterprises at an early stage through training entrepreneurs and bringing them closer to mentors of the Endeavor network, as well as sources of capital. (Source: Endeavor Scale-Up)
Incubadora PQS (Lima): The incubator of the Romero Foundation. It offers co-financing, with Non-Refundable Resources (RNR) of up to PEN50,000, to validate innovative business models. (Source: Incubadora PQS)
Incubagraria (Lima): The incubator of the National Agrarian University La Molina. (Source: Incubagraria)
KAMAN (Arequipa): The incubator of the Universidad Católica San Pablo de Arequipa. (Source: KAMAN)
StartUPC (Lima): The Business incubator of the Peruvian University of Applied Sciences. It offers specialized services for each startup through its Ideas Validation, Incubation and Softlanding programs. (Source: StartUPC)
StartupUNI (Lima): STARTUP UNI is the technology-based business incubator of the National University of Engineering. (Source: StartupUNI)
Zegelab (Lima): Zegelab is the business incubator of Zegel Ipae that started to promote and develop innovative ideas of its students and alumni to turn them into thriving businesses based on product, process, service or marketing innovations. (Source: Zegelab)
Seedstars Lima (Lima): Offers co-working space at Seedspace Lima and discounted access to some of its tested SAAS tools (together valued at $20,000), and US$15,000 cash investment. (Source: Seedstars Lima)
GAN Momentum Tour: Lima (Lima): The GAN Momentum Tour is a five-stop global tour that will focus on creating opportunities for startups to succeed and gain traction, wherever they are. (Source: GAN)
Peru Venture Capital Conference (Lima): Peru VCC connects Peruvian innovators and entrepreneurs with local and international investors. More than 900 attendees, 300 startups and 250 investors and corporations. (Source: LAVCA)
Fondecyt: FONDECYT stands for the National Fund for Scientific, Technological and Technological Innovation Development, an initiative of the National Council of Science, Technology and Technological Innovation (CONCYTEC) responsible for capturing, managing and channeling resources in co-financing to natural and legal persons who they conform the National System of Science, Technology and Technological Innovation (SINACYT), destined to the formation of highly specialized human resources and to the development of scientific research, the technological application of knowledge and its introduction to the market, and to the attention of social needs. (Source: Fondecyt)
Start Up Perú: StartUp Peru is an initiative of the National Innovation Program for Competitiveness and Productivity - INNÓVATE PERÚ, of the Ministry of Production, which includes seed capital and scaling contests for innovative, dynamic and high-impact ventures. Startup Peru is a tool, and at the same time an opportunity for innovative entrepreneurs to have a way and a means to carry out their business ideas of high added value that contribute to the development of the country. (Source: Start Up Perú)
PECAP: Provides data on capital investment in Peruvian startups and promotes ecosystem growth. (Source: PECAP)