Interview: Daniel Quintero Calle
What infrastructure is required to facilitate and incentivise entrepreneurship in Colombia, and what role can incubators play in this regard?
DANIEL QUINTERO CALLE: Rather than supporting infrastructure for innovation, Colombia needs to strengthen links between different stakeholders, such as private companies, investment funds, universities and others. Furthermore, there is room – especially in the secondary cities – for greater numbers of mentors, investment funds, specialised agents that bring in additional technology to Colombian companies, and universities with research centres.
Incubators, similar to centres for business development and university research centres, play a fundamental role in developing start-ups from their initial stage to a more mature one. In Colombia, incubators are no longer merely guiding entrepreneurs, but also investing in them. They are becoming increasingly sophisticated and offering entrepreneurs international exposure. We need additional incubators in the country – but only if they are more sophisticated than the existing ones, and allow entrepreneurs to have greater exposure to the dynamism of other business ecosystems abroad, for example.
How can innovation help to develop Colombia’s small and medium-sized enterprises (SMEs)?
QUINTERO: In general, innovation is the best strategy for improving productivity. Colombia, however, has challenges when it comes to innovation in micro enterprises, which represent around 94% of companies. There is often insufficient knowledge at management level to make appropriate investment decisions in innovation and increase productivity. Nearly 90% of the companies created in Colombia are established with obsolete technologies. The challenge is not only to build innovation infrastructure that supports these companies, but also to transfer knowledge of innovation and investment. Innovation is key to the growth of such companies, and, ultimately, for the growth of the country. The mere accumulation of capital no longer determines a company’s growth; productivity and innovation do.
What are the obstacles in the country to attracting investment in start-ups?
QUINTERO: The legal framework has been a challenge to attracting more management funds focused on developing the early stages of a company. There are many management funds focused on companies that have reached a more mature stage, but there are not many that can help start-ups assess the importance of intangibles, such as innovation.
How would you characterise the financing environment for start-ups?
QUINTERO: The financing environment is very positive. Through Innpulsa, the government has created three investment funds focused on SMEs and there are an additional five with the same focus. Counted all together, there are 80 investment funds in Colombia, and the number is expected to continue to grow. Additionally, the government has summoned three more investment funds in 2016.
What tools are available for Colombian SMEs that are looking to expand abroad?
QUINTERO: Firstly, tax incentives are available for those that invest in innovation. For every COP100 ($0.04) invested, there is a COP175 ($0.06) deduction on taxable income. Furthermore, through Innpulsa, Colciencias and the Ministry of Trade, Industry and Tourism, the government has called for national enlistment announcements to help companies overcome any barriers to accessing markets abroad. The government also helps start-ups to transition to other countries, and provides them with acceleration and training programmes in dynamic ecosystems.
