Contxto – Although the Colombian government has had its ups and downs with revolutionary and innovative business models, it still has a soft spot for startups. Why else would it be offering COP$78 billion (approximately US$24.6 million) of seed capital to qualifying entrepreneurs over four rounds?
Colombian executives recently launched the SENA (National Service of Learning) Entrepreneur Fund to support startups. With entrepreneurship being a national priority, this government fund plans to finance over 190 new business initiatives, regardless of the economic sector. More than 970 jobs could result from this effort.
“The support for new business ideas from the SENA Entrepreneurship Fund with financial, psychological, social and seed support, through the 4K Entrepreneurship Model, puts at the center the needs of the Colombian entrepreneur to ensure a comprehensive response,” said Hernán Fuentes, the Director of Employment, Labor and Entrepreneurship at SENA.
There will be four calls open to entrepreneurs via the SENA Entrepreneur Fund, the first of which began July 9. First round resources of COP$20 billion intend to sponsor new business creation while creating social inclusion and economic development vehicles.
With this, it seeks to support Colombians turn business ideas into tangible reality. Part of this involves formalizing business arrangements while generating new employment opportunities for citizens over time.
Moving forward, the second call for COP$18 billion will cater towards entrepreneurs in Colombia’s interior. Thirdly, seed capital of COP$20 billion will go towards members of the Orange Economy.
This term refers to creative industries producing cultural goods and services that can be protected by intellectual property rights. These range from acting, art, music, design, publicity, jewelry, photography, digital animation, etc.
Last but not least, the fourth call of another COP$20 billion will assist in creating more companies, jobs and productiveness across various economic sectors in Colombia.
Steps to apply are as follows:
- Once you have a business idea, you must visit one of 117 national SENA Business Development Centers. You can find the nearest one here.
- If you fulfill all of the application requirements, SENA will assign you a manager to oversee your registration. They will also provide access to the Entrepreneurs Fund platform to ensure your participation in one of four open calls.
- Following the evaluation process, your business plan will either be considered viable or not viable. If approved, you will go through a resource approval process to become a seed capital beneficiary to launch your business.
- With new seed capital, you need to sign an Open Pledge Business Cooperation contract to formalize the new business. The manager will continue supervising the company for one year, focusing on scalability such as increased sales, jobs, utilities, etc.
So far, the SENA Entrepreneurship Fund has allocated over US$596,8000 and promoted more than 7,360 business plans. In the process, this has generated over 29,500 jobs in over 700 municipalities.
Some reports also call this fund one of the largest public funds in Latin America and the most influential in the Colombian entrepreneurship ecosystem.
Raising seed money is no easy accomplishment for Latin American startups, so programs like this yield immense potential. Let’s hope other countries replicate Colombia’s model.