In January 2018 Magma Partners teamed up with Chinese coworking business, Kr Space, to launch the first China-Latin American accelerator to connect Chinese and Latin American entrepreneurs and investors.
With the recent news that Tencent invested $180M into Brazilian neobank Nubank at a $4B valuation, we’e seeing Chinese interest and investment in Latin America move beyond the common infrastructure projects backed by the Chinese government. The Chinese private sector is taking note of Latin America’s growing tech ecosystems and is capitalizing on opportunities to help the region follow a similar development path to China’s.
As the US pulls further away from Latin America, China is becoming an increasingly important partner for startups and companies across the region looking for investment and direction. As President Trump’s trade war intensifies, Chinese FDI into the US has dropped by 92% to $1.8B, while Chinese FDI to Latin America has surged to $15.3B in the first half of 2018.
This move by China is a strategic one. Latin America is ripe for investment and China and Chinese companies could be interesting partners for the region.
For one, Latin America is now a mobile-first market with over 200 million smartphone users. It is the second-fastest growing market for mobile in the world, and Latin American consumers are becoming quick adopters of new technologies and global apps.
Over the past five years, Amazon has slowly expanded into Latin America, testing the waters in Brazil, Argentina, Chile, and Mexico.
Despite the Seattle-based giant’s explosive success in the United States, Amazon has not yet made inroads as quickly in most of Latin America.
Part of the challenge is that Latin America already has its own e-commerce giant: MercadoLibre.
Founded in 1999 by Hernan Kazah and Marcos Galperin in Buenos Aires, Argentina, MercadoLibre is now the e-commerce site of choice in Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Mexico, Ecuador, Guatemala, Honduras, Peru, Panama, Uruguay, and Venezuela.
In Latin America, 47% of online shoppers buy on MercadoLibre while only 17% use Amazon. In Mexico, where Amazon offers similar services to the US, 38% of online shoppers still use MercadoLibre while just 21% use Amazon.
Chile is an economic powerhouse at the tip of South America. Rapid technology infrastructure development paired with a business-friendly political climate and high levels of Internet penetration have helped Chile’s e-commerce market stand out among its larger counterparts.
With a population of ~18 million, Chile is a small market compared to behemoths like Brazil and Mexico. However, Chile’s e-commerce sector is stronger than its local counterparts; Chile has a disproportionate 9% share of Latin America’s e-commerce market, despite holding only 2% of the region’s population. The Chilean e-commerce market is already worth more than US$3.7B and targeted to grow at 35% in 2018, reaching US$5B by the end of the year.
In part, this enormous growth comes as a result of international platforms, such as Amazon and AliExpress, which have drastically reduced delivery times and made e-commerce more accessible. Last year, national shipment company Correos de Chile partnered with AliExpress to reduce delivery times from a maximum of 60 days down to a window of 16 to 38 days. (more…)
Movile is a global leader in mobile marketplaces with a dream to make life better for 1 billion people through marketplaces on their mobile devices. Movile is a remarkable story of innovation from Latin America, driven by people who are willing to take risks to learn and grow quickly.
I sat down with the CEO and founder of Movile, Fabricio Bloisi, to talk about why he started Movile and how he and his team grew it to the largest mobile company in Brazil and Latin America.
Movile focused on innovating and exploring advanced technologies
In its early stage, Movile focused on text messages (SMS) and then enabled ringtone commerce in Brazil, as well as the development of the country’s first Wireless Application Protocol (WAP) search portal. In 2007, Bloisi focused on expansion. In 2008, and Movile built itself into the largest company in the Latin American mobile commerce industry through new products and mergers and acquisitions, establishing a presence in over ten countries with offices in Brazil, Argentina, Peru, Colombia, and Mexico.