Venture capital job seekers may soon be packing their bags for Brazil or Mexico, rather than the traditional destinations of India, China, and Silicon Valley.
That’s the opinion of Leonardo Navarro, writing in the Wharton Journal. Full disclosure: Navarro is currently enrolled in a special Wharton-Lauder MBA/MA program that’s geared toward preparing candidates for the world of global business. He is majoring in Emerging Market Business Development and Mandarin Chinese.
As Navarro points out, though, barely five years ago, one would be hard-pressed to find a single VC fund in Mexico. Today, they are flourishing there, as well as throughout Central and South America. Venture capital has become a cornerstone of the economic development policies in Chile and Brazil. Colombia, Chile, Peru, and Brazil have allowed pension funds to invest in private equity and venture capital vehicles. And Mexico has recently launched its first public fund of funds which could provide capital for new VC funds in the country.
Emerging Marketing Venture Capital (EMVC) has moved to the forefront of innovation in Latin America. There is even an association for research and networking in the sector, the Latin American Venture Capital Association (LAVCA), whose mission is to spur regional economic growth by advancing venture capital and private equity investment.
According to data from the LAVCA, Mexico has posted significant gains in venture capital development in 2009-2010. It is second only to Chile and Brazil, which have led the rankings for some time. The LAVCA publishes an annual “scorecard” on Latin American countries, ranking them on their venture-friendly attributes. This year’s report noted that the region’s top markets are closing the gap with developed nations when it comes to such attributes as laws on VC/PE fund formation, tax treatment, protection of minority shareholder rights, and more.
What about you? Do you see Central or Latin America playing a role in your firm’s future venture capital activity? Would you consider a venture capital job in that region? Add your comments below.
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