10 key entrepreneurs in the Mexican startup scene
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The Dev.F. team. Photo courtesy of Manuel Morato

The Dev.F. team. Photo courtesy of Manuel Morato

Geektime spoke with 10 of the Mexican startup scene’s key leaders, including CEOs, founders, and investors. This is what they think Mexico needs to do to become a bigger player in the global tech ecosystem

While Mexico is one of the largest economies in Latin America, its startup scene is still in its infancy. But this poses many opportunities, such as using technology to innovate older industries, harnessing the power of mobile penetration and e-commerce, and revolutionizing sectors of importance to Mexico such as education and government. Plus, if Mexico can do this, their solutions could easily expand to the rest of Latin America and potentially other developing countries.

Geektime spoke with 10 of the Mexican startup scene’s leading entrepreneurs and investors. We asked them what problems they saw with Mexico’s startup scene, what solutions could address these obstacles, and what they thought made Mexico’s startup ecosystem special. They also recommended Mexican startups to watch out for, including Rocket.la, Fondeadora, Voxfeed, Kichink, CornershopKueski, Aliada, and Conekta, among others.

These are their answers.

1. Lucia Trochez, Marketing Manager at Techstars

photo courtesy of Lucia Trochez

Photo courtesy of Lucia Trochez

What do you think will be the most important trends in the Mexican tech and startup scene in the coming years?

One of the most important trends we’re starting to see is fintech, which is growing like crazy. Another trend is social innovation. Based on the problems society faces in this country, a lot of entrepreneurs are aiming towards building businesses that tackle this.

Education of course is a cliché, but something that still keeps being relevant as society keeps trying to grow. And the last one I’d say is the makers industry, including Internet of Things, health improvement, and industry democratization.

What are the biggest challenges facing the Mexican startup scene, and what do you think needs to be done to overcome them?

It’s hard to actually understand the challenges because of the different kind of cultural and government policies that surround the startup ecosystem. Entities like INADEM help entrepreneurs through government funds, and a lot of VCs and incubators are trying to help with the financial and policy issues. There’s also a talent attraction problem in startups, as well as a lack of diversity in general.

What are the most prominent startups in this scene at the moment?

Rocket.la, Fondeadora, Sindelantal, Kubofinanciero, and Voxfeed.

2. Rodrigo Sanchez Servitje, Managing Partner at Bridge 37 Ventures

Photo credit: Bridge37.com

Photo credit: Bridge37.com

What do you think makes the Mexican startup scene special?

Mexico has a very interesting concentration of big companies that are in legacy industries. Most of them realize there is a need for innovation and have no idea how to cope with the accelerating pace of changes happening to their businesses. This provides great opportunities for startups to partner and find early clients.

What are the biggest challenges facing the Mexican startup scene, and what do you think needs to be done to overcome them?

Mexican entrepreneurs don’t think big enough. Most are focused on incremental innovation, making them able to create big companies with big returns. This is hard to overcome. Most Mexicans with big ideas go to Silicon Valley. If Mexico is capable of building an innovation ecosystem capable of keeping these guys in Mexico, that will change.

3. Fernando Lelo de Larrea, Managing Partner at ALL Venture Partners

Fernando (left) and Federico Antoni (right, ALLVPs other managing partner). Photo Credit: ALLVP

Fernando (left) and Federico Antoni (right, ALL Venture Partners other managing partner).
Photo courtesy of  ALL Venture Partners PR

What do you think makes the Mexican startup scene special?

The Mexican startup scene is reaching a point where the necessary elements for it to flourish are in place: a dynamic and vibrant, technically educated youth, support institutions like incubators, mentors, angels and government programs, macroeconomic stability, and funding mechanisms.

What makes it unique is that it sits in a huge domestic market of 115 million inhabitants, which has developed unevenly, with a large segment of the population that has a lack of opportunities.

This creates ideal conditions for a culture that develops unique solutions for leapfrogging through technology solutions and services that can reach masses. These solutions can then be global. The inefficiencies faced by Mexicans are common to all developing economies, yet Mexico has the means to fix them: knowledgeable entrepreneurs, proximity to Silicon Valley, and the “ecosystem” to nurture companies. The entrance into the rest of Latin America allows them to work there before they go global.

What do you think will be the most important trends in the Mexican tech and startup scene in the coming years?

I see four big sectors with huge potential in the Mexican startup scene, all related to this divided condition in our domestic economy:  Healthcare solutions, Fintech, Education Tech, and Energy.

Of course mobile penetration is an important part of catching up for Mexico since it has fallen behind. Industries are being shaken through reforms, but mostly through behavioral changes of a more proactive and demanding population.

What are the biggest challenges facing the Mexican startup scene, and what do you think needs to be done to overcome them?

The two biggest challenges I see are related to the “adolescence” of our ecosystem. Despite having good seed funding, the financial support is not here. Series A/B funds are still scarce, and exits are rare. The second challenge is that Mexican startups have not gained an international spotlight. Mexico has to create some buzz about it with the right players, through a couple of success stories, but mostly through a coherent story that shows the solid economic foundations, purchasing power, proximity to international markets, and high quality entrepreneurs working untiringly for an opportunity.

What are the most prominent startups in this scene at the moment?

I think six startups are worth special mention:

1) Aventones – A ride sharing service that was recently acquired by BlaBlaCar so as to expand their operations through Latin America.

2) Fondeadora – A reward based crowdfunding platform that has gained great traction, with a solid, active community.

3) Prestadero – A peer-to-peer lending platform.

4) Kichink – An integral solution for e-commerce.

5) Cornershop – A grocery delivering system (like Instacart).

6) Santa Carmen – A kidney failure networks of clinics revolutionizing healthcare offering through hemodialysis.

4. Ariel Poler, Angel Investor, Founder at IPRO

Photo credit: Ariel Poler

Photo courtesy of Ariel Poler

 

What do you think will be the most important trends in the Mexican tech and startup scene in the coming years?

The increase in the percentage of the Mexican population that becomes active digitally. Historically Mexico has had very expensive infrastructure costs and very low usage by the population of things such as e-commerce. As technology prices move in line with the rest of the world and the bulk of the population becomes comfortable moving a lot of their lives online, there will be huge opportunities to address their needs.

What are the biggest challenges facing the Mexican startup scene, and what needs to be done to overcome them?

There are few investors in Mexico. This is starting to change, but slowly. In the meantime, investors from other parts of the world have a great opportunity. Government regulations and monopolies are also a problem, but those seem to be moving in the right direction.

What are the most prominent startups in this scene at the moment?

I am a big fan of Kueski in the fintech space, and of Cornershop, in the delivery space. Disclaimer: I am an investor in both of these companies.

5. Fernando Fabre, President of Endeavour Global

Photo credit: TEDx

Photo credit: TEDx

What do you think makes the Mexican startup scene special?

The Mexico startup scene is nothing special yet, but it has the potential to become relevant over the next 10 years. Highly talented entrepreneurs are making an entry and have created venture capital funds. A small number of government folks have successfully focused on funding venture capital funds; and there are a few serious organizations supporting entrepreneurs with real mentoring and funding, as opposed to the failed incubation model.

What do you think will be the most important trends in the Mexican tech and startup scene in the coming years?

The most positive trend by far is e-commerce. The entry of Amazon, the launch of Clip, the success of Kichink, and the launch of the Mexican association of e-commerce (asociación mexicana de ventas online) with over 60 online firms registered and organizing a successful Hot Sales Monday event, are an indication that Mexico finally is getting e-commerce right.

I predict that in 5 years Mexico will have one of the highest worldwide growth rates in e-commerce activity measured by users and revenues. I also predict that in 5 years Mexico will have one or two very large and visible exits.

What are the biggest challenges facing the Mexican startup scene, and what do you think needs to be done to overcome them?

You can blame the bad performance on two things: lack of highly talented entrepreneurs and therefore lack of role models; and government policies that focused on creating incubators inside universities for undergraduate students, confusing patents with market innovation, trying to subsidize the creation of communities for industries they picked, trying to have science done at universities and then trying to link it to the private sector and supporting cheap labor as a great tech model, leading to production rather than creation.

6. Jorge Rios, Co-Founder, Bridgefy

 Jorge Rios, Diego Garcia, Roberto Betancourt (Bridgefy co-founders). Photo Credit: Bridgefy

Jorge Rios, Diego Garcia, Roberto Betancourt (Bridgefy co-founders).
Photo courtesy of Bridgefy

What do you think makes the Mexican startup scene special?

The Mexican scene is special because of how resourceful Mexicans are. We identify problems and think of unorthodox but effective ways of solving them, and it’s usually applicable to many other developing countries. Also, it’s a small community so everybody knows everybody and we try to help out one another.

What do you think will be the most important trends in the Mexican tech and startup scene in the coming years?

My prediction is that there will be startups leaning towards creating products that lower-middle and lower class citizens will be able to use. It’s a huge market that is just beginning to be addressed, and will only grow due to Mexico’s exponential smartphone ownership growth. Services that employ and cater to lower class people will prevail. I also think mobile payments has huge potential as a market in developing countries.

What are the biggest challenges facing the Mexican startup scene, and what do you think needs to be done to overcome them?

I think there are three big challenges that, if addressed, will allow the Mexican startup ecosystem to grow and thrive:

– To overcome corruption and politicizing of economic resources by both public and private funds

– There is dangerously little capital that goes into pre-revenue startups, which in turn prevents the creation of a larger number of companies

– Lack of legal documents and procedures that enable fast and cheap company incorporation

Solving these problems would result in curing another huge problem: the lack of successful local role models that incentivize more people to start their own companies.

What are the most prominent startups in this scene at the moment?

Dev.F., Aliada, ComproPago, Blooders, Codeando México

7. Andy Kieffer, General Partner at Agave Lab Ventures

Photo credit: Andy Kieffer

Photo courtesy of Andy Kieffer

What do you think makes the Mexican startup scene special?

Low hanging fruit. The vast majority of industry is oddly divorced from technology.  We have tons of internet technology people who know virtually nothing about traditional industry AND tons of industry people who know virtually nothing about technology. There are a lot of reasons for this but the biggest factor is the more dynastic succession of power and money.

The internet breaks this mold.  If I’m buying widgets from your website, I don’t really care who your father was, or what your last name is.  If your widgets are the best/cheapest you get my business. This breaks down the stranglehold that the most established families have had on industry.

The opportunity lies in the fact that most of the moribund industries have been allowed to creep along inefficiently with little or no competition. This provides easy pickings for startups that are willing to pursue these enormous and often-time patently obvious opportunities.

I view the startup trend as the first true meritocracy in Mexico and it’s breaking down doors right and left.

What are the biggest challenges facing the Mexican startup scene, and what do you think needs to be done to overcome them?

We have to stop trying to build a “Silicon Valley of Mexico.” Mexico is not Palo Alto: It’s hard to imagine two cultures more distinct from one another. Rather than import an entrepreneurial and investment paradigm that evolved over 30 years to suit the unique needs of the NorCal market, we need to look around us and build a model that works for the local conditions.  My vote is to focus first on fixing our creaky, old-school industries.  Once we have those well in hand, we can invent the next Tinder for Left Handed Cats.

What are the most prominent startups in this scene at the moment?

Kueski – a great team providing access to modest-sized loans. That is an industry that’s huge and woefully antiquated.

VoxFeed (disclosure, they come out of our incubator) is crushing it by modernizing the advertising market in Latin America. In fact, they’re a great example of the point I made earlier. The ad market in Mexico is $3 or $4 billion in size, but only 6% of this is online, globally far behind everyone else.  However that 6% is growing at a blistering 29% per year. That is yet another under-attended market with huge upside that’s growing at a phenomenal clip.

8. Rodrigo Ramírez Organista, CEO of Guadalajara Angel Investor Network (GAIN)

Photo credit: Rodrigo Ramirez Organist

Photo courtesy of Rodrigo Ramirez Organist

What do you think makes the Mexican startup scene special?

A lot of industries are far behind of the rest of the world in terms of tech development or use. However there is a very collaborative ecosystem. I am actually writing this in Campus Party, where thousands of entrepreneurs collaborate.

What do you think will be the most important trends in the Mexican tech and startup scene in the coming years?

It has become kind of sexy to invest in startups lately, even if you have a lack of knowledge about them. So, I believe that in the next couple of years a lot of people will start their own funds, but will not necessarily be qualified to run them.

Hopefully, we will have our first exit and that will help the ecosystem a lot. Those entrepreneurs will be experienced and rich, so they will be the perfect angel investors.

What are the biggest challenges facing the Mexican startup scene, and what do you think needs to be done to overcome them?

We need more qualified engineers. I know this is a worldwide issue and I think that the way to overcome this is through education. Integrate universities into the ecosystem. Include online education from places like MIT, Coursera, Udemy, which have courses related to the environment. Startups themselves can make their own internal training program to have great back/front end, U/X coders.

What are the most prominent startups in this scene at the moment?

Voxfeed: Gustavo López, Manuel Honorio and their mentor/investor Andy Kieffer.

Kueski: Adalberto Flores, Leonardo de la Cerda; mentored by Pat Gallaguer and Shinya.

Rigs: they are accelerated now by Mass Challenge and Reto Zapopan.

9. Manuel Emilio Morato Mungaray, Co-Founder at Dev.F.

Photo credit: Manuel Morato

Photo courtesy of Manuel Morato

What do you think makes the Mexican startup scene special?

We live in an emerging country with lots of problems. However we are the 12th largest economy in the world, with a population of 121 million in a geographical position that puts us right between the U.S. and the rest of Latin America. Entrepreneurs who manage to solve problems for a Mexican audience can potentially tackle similar problems in the rest of Spanish-speaking Latin America. This ends up adding to a very large potential market that is only moving upwards in economic power and disposable income.

What do you think will be the most important trends in the Mexican tech and startup scene in the coming years?

From what I’ve seen until now, I believe the most important trends in the Mexican startup scene will be the following:

E-commerce – Companies such as Linio and now Amazon are pushing the use of credit cards to mainstream use by bringing down cultural barriers about the safety of purchasing goods and services online.

Payments – Mexico is notorious for its huge informal economy, with businesses that operate on a cash only strategy. There’s big opportunity for providing a system that will allow informal businesses to process credit cards and start bringing them into the economy.  Frictionless API-based payments such as Stripe or Conekta will only grow in presence as more companies see the value of processing money in this way. Any startup aimed at the bottom of the pyramid could potentially have access to a huge market base.

Education – The education system in Mexico is a failure. There is huge potential for education startups. We are already seeing a surge in online courses in the country as more and more people discover that they can use the Internet to learn online at a very low cost. For those who are unable to use these online tools on their own, there are new school models in the offline world.

Civic Tech – Because the government and public sector are unable to address many of the country’s problems on their own, more and more initiatives are arising around the use of technology and software for civic purposes. The Open Data movement is gaining momentum in the country and that is generating increasing access to large public repositories of information. Interesting solutions to painful problems will probably come to light in this space.

Transport – Another painful problem for Mexicans is mobility, especially in large cities like Mexico City or Guadalajara. New startups that are able to make life easier for people moving about cities will find a ripe market for their services.

What are the biggest challenges facing the Mexican startup scene, and what do you think needs to be done to overcome them?

There are still nascent tech companies in Mexico who start a technology based venture without a CTO or a technical co-founder, who end up outsourcing their product. This leads many Mexican startups to never actually lift themselves up from the ground.

Mexico does not lack a plethora of very big companies in different industries. America Móvil is one of the largest telecoms companies in the world. However, we don’t see many of these big companies becoming interested in acquiring young talented startups. We need more of these bigger companies to be on the lookout for the startup market in search of talent and new technologies.

What are the most prominent startups in this scene at the moment?

These are the most prominent startups that come to mind right now:

Conekta – Payments API. They’re growing thanks to their understanding of the Mexican market and are providing an effective payments solution for companies.

E-Conduce – Electric scooters. I believe they’re tackling an important mobility problems and doing so in a way that is consistent to the traffic situation of Mexico City.

Kueski – Online micro-lending. Kueski is consistently growing and has also raised unprecendented levels of Mexican and Silicon Valley venture capital operating from Mexico.

Miroculus – Jorge Soto is pushing this hardware/software hybrid that aims to provide early detection of certain types of cancer.

Aliada – On-demand house cleaning. Also growing, also managed to raise considerable venture funding and working to grow this model in a very fragmented Mexican version of this market.

OPI – Big data analytical tool. A solid team managing to push the use of industrial amounts of centralized data to find social and economic trends and patterns. Also raised considerable venture funding.

Platzi – Online education platform. Not exactly a Mexican company (founders come from Colombia and Guatemala) but with a huge presence in the Mexican market.

10. Juan Martitegui, Co-Founder/CEO at Mind Valley Hispano (The Spanish language version of Mind Valley)

Photo credit: Juan Martitegui

Photo courtesy of Juan Martitegui

What are the biggest challenges facing the Mexican startup scene, and what do you think needs to be done to overcome them?

I think the main problem in Mexico and Latin America in general is the lack of acquisitions, IPO. The early stage is pretty much solved. You have funds from big companies (ie. Wayra), from US VCs (500 Startups MX), from Government, etc. If you are good even the series “A” is not a problem.

The problem begins when you need to sell. Unfortunately IPOing is not that common in Latin America and big companies are not that used to buying startups. I believe this will start happening more and more, but until big companies start buying “innovation” from startups, you get yourself into a little bit of a problem. It will only take a couple of acquisitions to start a new stage for the market. But we are still not there.

What are the most prominent startups in this scene at the moment?

This one is tough because I’ll name the ones I’m investor, customer/user or friends of the company. But I think the ones that will be making headlines are: Nubity.com, Konfio.mx, Rocket.la, Autochilango, 99Minutos, Conekta and some others from the 500 startups family.

Casey Lane and Laura Rosbrow-Telem contributed reporting. 

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Alex Lazear

About Alex Lazear


Alex is a geek. An avid writer, he spends his free time playing video games, catching up on the latest movie release, or messing with whatever gadget he can get his hands on.

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