Switzerland of the Americas
When you think about the South American startup scene, your first thoughts probably rush to Brazil or Chile. One country you probably don’t often consider, however, is Uruguay. This needs to change.
Uruguay offers excellent opportunities for startup founders and foreign investors. For one, Uruguay has one of the most free economies in South America. Located between Argentina and Brazil, businesses in Uruguay can take advantage of excellent free trade opportunities.
Uruguay also has a high degree of freedom of press. In fact, even the UN has praised the country for the freedom it gives to the media.
Globally, Uruguay has earned the nickname “Switzerland of the Americas”. This is because of the country’s low crime rates and highly educated workforce. Uruguay is one of the best countries to live in if you’d appreciate the combo of a European standard of living with a laid back Latin lifestyle.
Back to business. Uruguay has nearly 1,000 tech companies exporting software across 52 international markets. Do we need to add that Uruguay is also the top software exporter per capita in South America?
Perhaps this is a result of Uruguay’s 2008 decision to institute its One Laptop per Child program. This program provided computers for nearly all public school students in the country. One could certainly speculate this initiative played a large role in Uruguay’s tech success today.
In any case, Uruguay’s tech scene is BOOMING. With tax exemptions for software exporters, and Free Trade agreements that provide access to other tech hubs in South America, there’s never been a better time to do business in Uruguay.
This is without even mentioning the incredible coworking spaces and government programs that’ll assist you in your entrepreneurial endeavors. Speaking of government programs that brings us to…
ANDE is a government agency that is working to promote the economic development of Uruguay. ANDE does this through programs that improve the business and territorial competitiveness of SMEs in Uruguay.
One way ANDE supports entrepreneurs and startups is through its Validation of Business Ideas (VIN) program. In this program, ANDE along with another organization ANNI (National Research and Innovation Agency), accompany entrepreneurs in the validation process of a business idea or product.
Validated projects that are sufficiently innovative may then have the opportunity to receive financing. Selected projects will also work alongside a sponsor that supports the project in a number of ways including:
• Preparation and presentation of the project.
• Defining the scope of the project with the entrepreneur/team.
• Advising the entrepreneur/team in potential business models.
• Helping the entrepreneur/team elaborate on the work plan, budget, objectives, etc.
If you’re interested in ANDE and ANNI’s Validation of Business Ideas program, you can read more about it here.
Of course, ANDE has other programs as well. We’d recommend joining the bulletproof billion dollar exit (BBE) program. Don’t worry if you aren’t able to get into that one though. It’s quite competitive ;).
Seriously though, ANDE has another awesome program you should be aware of. We are of course referring to…
Seed (Semilla) ANDE is a government program that offers non-reimbursable contributions to startups and other rapidly growing companies. Simply put, your startup can get FREE funding that does not need to be paid back.
To qualify, projects must meet a number of conditions. For one, the applicant needs to have a business idea that has already been validated. If the applicant’s idea or product does not yet have validation, the Validation of Business Ideas (VIN) program mentioned earlier would be more appropriate.
Assuming the project has been validated, however, the project must also:
— Have dynamic growth potential.
— Have the potential to quickly generate jobs.
— Have a degree of local innovation in the product, service, production process, or marketing form.
Oh, and one more thing. You don’t need to be Uruguayan to apply for Seed ANDE. You can be eligible for the program even as a foreigner. You just need your company to be based in Uruguay.
The other thing ANDE stresses is that their seed program is focused on capturing ventures from all over Uruguay. While many of the participants in Seed ANDE are from the capital city Montevideo, the program also funds many startups in smaller cities across the country.
And don’t worry if you’re a female founder either. 44% of the entrepreneurs funded by Seed ANDE were female. #FemaleFoundersForTheWin.
With that being said, we also contacted ANDE to find out just who shouldn’t apply to Seed ANDE. Their response? “Traditional ventures, freelance businesses, ventures seeking investment in equipment, and the purchases of franchises are not suitable for our program.”
“Percentage of entrepreneurs funded by ANDE that are female.”
Meet all the criteria?
Congratulations. Let’s assume your project is selected. After contributing $5,000 USD of your own money, you’ll then receive a contribution of roughly $20,000 from ANDE. Just note that these funds need to be used within one year.
You’ve received funding from Seed ANDE. Now what?
Apart from providing financial support for entrepreneurs, Seed ANDE will also request that you partner with a sponsoring institution. This sponsoring institution will provide business incubation services in the early stages of your venture.
Your ANDE-approved sponsor will also work alongside ANDE to accompany you throughout the process of project execution. Your sponsor and ANDE will provide you with mentors, guidance, and access to a network of contacts as well.
In addition, ANDE promotes bonding activities between entrepreneurs, access to specialized training sessions, and contacts with potential investors. Your business network will quickly strengthen upon inclusion in the Seed ANDE program. Guaranteed.
Yet, there’s more. ANDE made an interesting point during our interview with them. They stated that the most underrated benefit of the ANDE program is actually the application process itself.
This is because going through the application process gives you experience promoting your project. The application process will also boost your critical analysis skills, and expand your vision and expectations for your startup.
Most of all, being selected to receive funding from Seed ANDE is no easy feat. Going through the process and being selected can actually serve as social proof for your project. Local investors and venture capital firms see acceptance into Seed ANDE as a seal of a quality project.
Rightfully so. Since its creation in August 2016, the Seed ANDE program has put up some impressive numbers. Such as…
Rounds of funding conducted.
Number of entrepreneurs involved.
Percentage of female founders.
Number of projects evaluated.
Number of projects selected.
Average number of jobs created per project.
You’ll rarely hear Uruguay mentioned in the startup hub conversation. That needs to change. Fortunately, with the help of organizations like ANDE, Uruguay is receiving more attention. The Validation of Business Ideas (VIN) program, and Seed ANDE are two programs you should be aware of.
With that being said, VIN and Seed ANDE are just part of ANDE’s efforts to strengthen the competitiveness of micro and small companies in Uruguay. To learn more about what ANDE is doing to promote economic development in Uruguay, visit ANDE’s website here.