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Latin America is seeing almost daily announcements about capital raises, new startups, and recently created companies whose services have won market share over large competitors.
The region is now booming as a lab of good ideas, where unicorns like Rappi, Cornershop, Clip, Kavak, Bitso, NotCo, NuBank, and Loggi, to name a few, have emerged.
There is plenty of talent, but what is needed to accelerate this growth? Most of the time, it’s financing. That is why LatAm entrepreneurs are constantly looking for strategic alliances to raise capital.
Miami is the largest venture capital market in the world
This is precisely where Miami becomes such a strategic cornerstone. The city is currently the largest venture capital market in the world, according to A Bridge to the Future, a study presented this week during the IDB Lab Forum.
The startup ecosystem in Miami is one of the fastest-growing in the U.S., with venture capital growing six-fold every year since 2015.
The report discusses that there can be a mutual benefit generated by building a stronger connection with the innovation ecosystems of Latin America and the Caribbean (LAC).
The exponential technological revolution and the rise of the region’s startup ecosystem create an opportunity to build a network of startup and knowledge ecosystems driven by talent.
Such talent could generate billions in income and millions of jobs while driving the industries of the future throughout the hemisphere.
“LatAm and the Caribbean could leverage Miami as a platform to activate new growth engines,” report.
The joint potential of Miami, LatAm and the Caribbean
The startup ecosystem in Miami is young. It has around 481 companies that have raised capital from major funds such as Riverwood Capital and Softbank. The Japanese conglomerate’s fund allocated $100 million exclusively for Miami, according to Startupeable.
The city is also a hub for Latin American expats and immigrants. According to Hispanifederation, more than 4.9 million Latinos live in Florida, and 71.5% of Miami Dade County’s population is Latino.
Thus, the study A Bridge to the Future finds five areas of opportunity that will benefit both Miami and Latin America, and the Caribbean:
- Activate more than 5 new startup ecosystems in Central America and the Caribbean, to catalyze the potential for an additional $20 billion of annual knowledge-based exports.
- Accelerate the growth of the Spanish-speaking regions’ venture capital market, which could mobilize more than $30 billion annually by 2030.
- Activate the Deep Tech ecosystem, especially in health technology and biotechnology.
- Create more than $100 billion of value by 2030. This would activate private sector research and development (R&D), which could bring an additional 0.5% to 1.0% GDP growth to the region by the same year.
- Accelerate the growth of knowledge-based services exports from Latin America and the Caribbean, which amount to $42 billion dollars per year and could increase by an additional $100 billion dollars by 2030.
The report presented during the IDB Lab Forum sees ample areas of opportunity for Latin America and the Caribbean to be the next unicorn. For its part, Miami is adding talent to its ranks.