Venture Capital Firms and Funds in Latin America and the Caribbean

Tapping into Latin American venture capital
By Frank Alvarado If you are opening a new business in the Southern hemisphere or plan on expanding your company into the region, accessing venture capital firms in Latin America and the Caribbean is important. Latin America venture capital fund raising and private equity investment reached a record $4.4 billion in 2007 with venture capital firms in the Caribbean and venture capital funds in Latin America pumping money into real estate, energy, fuel production and distribution sectors.

Like their U.S. counterparts, Latin America venture capital firms are usually private partnerships or closely-held corporations that come from various sources including pension and endowment funds. Venture capital investing in Latin America is aggressive and the people controlling Latin America venture capital funds are demanding. They want to cash in quick and big, at least ten times what they invest. When attracting venture capital companies in Latin America and the Caribbean, consider the following:

1. Research the Latin America venture capital firms that finance companies in your business sector and select 2 or 3 that you like best.
2. Negotiate with those venture capital firms in Latin America that you selected and compare offers, choosing the one that offers the best terms.
3. Don’t be afraid to start a bidding war among Latin America venture capital funds to finance your expansion.

Draft an air-tight business proposal

Latin America venture capitalists don't want to waste time on a skeptical business plan. Your projected budget, earnings and losses will determine whether your company gets to tap into Latin America venture capital funds, so you must make sure that you are presenting a viable, sustainable business.
Try:  Track where Latin America venture capitalists are investing their money before pitching your business plan. For example, one growing trend in the region has been investment in sugar and ethanol, specifically the construction of ethanol mills in Brazil. Websites like World Trade Executive produce monthly newsletters on what business sectors are attracting venture capital in Latin America and venture capital in the Caribbean.

Research venture capital companies in Latin America and the Caribbean

Finding the right Latin American venture capital services for your company takes a considerable amount of careful research. You don't want to get stuck with venture capital firms in Latin America that do not suit your needs.
Try:  A helpful resource is the Latin America Venture Capital Association, which collaborates with industry experts, development organizations, financial institutions and other associations to develop model documents, industry guidelines and standards for venture capital investing in Latin America.

Travel to Latin American venture capital conferences

The Latin America Venture Capital Association is just one of several organizations that provide important networking forums for venture capital firms in Latin America where senior managers from leading Latin America venture capital funds, international public and private sector investors and high-level government officials address the environment in the region's venture capital and private equity markets.
Try:  Consult with Venture Capital Conferences to get up-to-date information on upcoming Latin America venture capital forums and conferences.

• Network in the U.S. with venture capitalists organizations and Latin American business development organizations to get a leg up on the competition.