The Advantages and Disadvantages of Doing Business in Colombia

Colombia has come a long way as a country and as a place to do business. The sensationalized version of Colombia that Narcos depicts is no longer accurate, though the reputation lives on.

Colombia’s history is long and complicated, filled with violent groups trying to control the country’s lucrative drug trade. But there’s so much more to Colombia than just drugs. 2017’s historic peace agreement between the Colombian government and the FARC, the largest guerrilla group, is a potential inflection point in Colombia’s history. And if I had to bet on a single Latin American country for the next 10-15 years, Colombia would be my pick.

Though many think it’s coffee, Colombia’s largest export is actually petroleum, which makes up over a third of the country’s exports, followed by coal, coffee, cut flowers, and gold. Coffee, however, was responsible for pushing Colombia toward a manufacturing based economy. After the War of a Thousand Days, which ended in 1902, Colombia’s coffee boom pushed the country to seek better transportation and manufacturing mechanisms.

Coffee production consistently grew in the 20th century, employing more than 500,000 families. While the government managed Colombia’s economy conservatively, the the political atmosphere turned increasingly unstable, corrupt and violent from the drug trade.

In 1991 the country adopted a new constitution. The motive for this wasn’t necessarily economic, but rather political, in order to make peace and bring drug lords to justice. Colombia remained relatively stable economically until the late 1990s when fiscal deficits cause a higher public debt which resulted in the country’s first economic recession in over 60 years. But by the early 2000s, the economy began to recover, due to high petroleum prices and stable coffee prices. Continue reading…

How to Diversify Your Assets With Latin American Real Estate Podcast

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Max Coursey, the founder of Tiger Prop, an innovative real estate brokerage based in Boise, Idaho, invited me to be on his Real Estate Insiders Radio podcast. We covered a huge amount of ground about Andes Property and PropertySimple including:

  • Tips for investing in Latin America
  • Common misconceptions about Latin America
  • Cap rates and net return deep dive in Chile and Colombia
  • Tips for investing safely and profitably
  • Comparison to returns in the US
  • PropertySimple’s new AI tool for real estate agents
  • How the internet’s changed for real estate leads in the past few years

Thanks again for inviting me Max, I had a great time! If you have any follow up questions about investing in Latin American real estate or PropertySimple’s real estate tool, feel free to reach out!

Listen to “Nate Lustig – Learn How To Diversify Your Assets – Invest In Latin America!” on Spreaker.

Colombia Venture Capital Overview

This post is the third in a series about Latin American venture capital ecosystems. Read the post on the Chilean Venture Capital, Peru Venture CapitalHighlighting Latin American Startups. Hopefully it’s helpful. Thanks to Monica Avila from Magma and Andres Barreto from Social Atom for reviewing drafts of this post and improving it.

Private Investors

Social Atom Ventures – A $30m investment fund with offices in Medellin and Bogota. They invest into early stage companies that have their technology team in Latin America, but whose target market is the US. We’ve done two co-investments with them.

Torrenegra Labs – Accelerator and early stage investor based in Bogota. 20 investments. 5 exits.

Magma Partners – Monica Avila is our lead in Colombia. We plan to invest in 1-2 companies per year. Additional presence in Chile, Mexico, USA.

Axon – Late stage capital. Six investments.

Continue reading…

Magma Colombia

monica-avila-foto-headshotI’m excited to welcome Mónica Ávila Forero to Magma to lead our Colombia team. Mónica, based in Bogota, has worked in the entrepreneurial ecosystem from all sides for the past 15 years: she’s started her own startups, worked with Ventures, a private NGO to build the Colombia ecosystem, and has worked closely with and mentored Colombia entrepreneurs, helping them figure out their business models, connect with potential investors and scale their businesses. I’m really excited to work with Mónica to help entrepreneurs in the Colombian market!

Why Colombia? Continue reading…