Prosperity through Connectedness

Chile’s geographical isolation has resulted in a culture that values external connections. Chileans have had to develop innovative ways to reach out to the world. This mindset provides the backdrop to the creation of Start-Up Chile.

By bringing entrepreneurs to Chile from all over the world, Start-Up Chile not only makes Chile better connected to the rest of the world, it also contributes to a cultural change that creates more openness toward entrepreneurship.

Start-Up Chile is a program created by the Chilean government. It depends on the Ministry of Economy and is executed by the Chilean Economic Development Agency (CORFO), the leading organization for promoting innovation and entrepreneurship in the country.

The premise of Start-Up Chile is simple: Chileans should invest in talented people no matter where they come from. The program should look at their projects and capabilities first, passports second.

So far, Start-Up Chile’s results have exceeded expectations. In less than two years the program has received over 2,000 applications; of these, over 300 projects have been selected; of the selected projects, approximately 100 have already graduated to be part of the program’s Alumni Network.

While Start-Up Chile’s objectives are long term, the impact that it currently is generating in the local ecosystem is evident. As of April 2012 there were 220 foreign start-ups operating in Chile, 60 percent of which are developing their prototypes and 34 percent of which already have some market traction (users or sales). These 220 startups have raised almost $10 million in equity investments, primarily from the United States. Tech meetups that once attracted only 20 or 30 people per week now attract more than 100—foreign and local entrepreneurs who gather to share knowledge and ideas in their areas of expertise. Ex-participants of Start-Up Chile have also created the Association of Entrepreneurs of Chile (ASECH), of which many Chilean entrepreneurs are members.

Origins

Start-Up Chile was born in 2010 from the ideas of two people: a Chilean, Nicolas Shea, who was living in the United States and finishing his master’s at Stanford University, and Vivek Wadhwa, an Indian academic and technology entrepreneur who lives in Silicon Valley. They believed that the best way to go to the next level in innovation and entrepreneurship in Chile was through immigration. Their idea: to bring foreign entrepreneurs to launch their start-ups in Chile, and in so doing to increase the countries access to worldwide business networks.

Shortly after the massive earthquake that shook the country in February 2010, Nicolas Shea began knocking on the doors of the Chilean Government and the Ministry of Economy, trying to sell his idea. Finding the possibilities very attractive, the government authorized him to start a pilot program that would fund twenty-three projects. One hundred applications came in. The chosen applicants went to live in Chile for a six month period; each entrepreneur received $40,000 and a work visa valid for one year.

The pilot was very successful. It created links between the local ecosystem and the global business community. It nuturned successful start-ups that today are being further developed in Silicon Valley, and in Santiago.

Upon seeing the success of the program, the Chilean government decided to expand it. The governmnt set a goal with the hope of having 1,000 entrepreneurs involved by 2014.

In 2011, the first round the competition drew 320 projects applications from more than 30 countries. Of these, 100 were selected and 84 accepted the challenge. In the second round, which occurred in July 2011, more 650 applications came in—this time from more than 70 countries—of which 154 projects were selected. Finally, in the third round at the end of 2011, 570 applications came in, of which 100 were selected.

My own participation in the program began in June 2011, when Jean Boudeguer, then the executive director of the program, invited me to participate as assistant director. From the beginning, I was impressed with the dynamism of the program. My primary responsibility was help to organize the structure and processes required to move...