What new initiatives is iNNpulsa currently involved in?

ORTIZ: iNNpulsa is in itself a new initiative. It is a government program to foster high impact entrepreneurship and innovation. We specifically focus on high growth. People wonder why we concentrate on high growth when most of our entrepreneurial context is SMEs. This is because high growth enterprises are the ones that grow the most and create employment, these are also the entities that tend to be more stable and sustainable, so that is why we are looking at high growth companies that are based on technology and innovation.

What are the biggest challenges that young entrepreneurs are currently facing in Colombia?

ORTIZ: The biggest challenge is in the way we think. So, what can we do about that? What can we do about the fact that innovation is not high on the public agenda? What can we do about the fact that we tend to be risk averse? We are trying to work with trans-media, visualizing a lot of Colombia’s innovations, which are somewhat invisible, to bring them out, showcasing a lot of stories and telling about them and their success, so that they become part of the narrative, part of the everyday conversation. There are some incredible stories of successful Colombian innovations, making Colombian entrepreneurs big here and around the world, and we are trying to diffuse this information.

The first thing we have done is to spark that conversation. You can sort of measure it in terms of how many stories there are about these business cases in the local press. Financing for innovation and entrepreneurship is hard in Colombia, as it is in the rest of the world, because of its inherent high risk. But in the first year of operation, we have been able to finance over 515 companies with approximately $50m and this is just through iNNpulsa, a small government program of the Colombian government. I think our program has been very successful in terms of being able to put the first dollar out there. We do not want to replace the market, or become the market. We want to spark private investors and banks and trigger the existing mechanisms, with the aim of making funds more readily available for innovation and entrepreneurship.

What actions is INNpulsa taking in order to help alleviate these obstacles?

ORTIZ: We know that we want more companies in Colombia to grow faster and more profitably. Thus, we do 3 things. We work very hard on cultural mentality, because the first change that has to occur is in the way we think, our mindsets. The second thing we do is to intervene in the market failures. That is, we help in bridging the financing gap and connecting entrepreneurs and innovators with companies that can buy their products. Finally, given that Colombia is very diverse, our third objective is to bring all of the regions up to speed, so that this program does not only take place in the capitals of the different departments, but in the whole of Colombia.

In the recent WEF Global Competitiveness Report, Colombia received a ranking of 66th with regards to capacity for innovation. In what ways can entrepreneurship improve Colombia’s overall capacity for innovation? What programs or policies is iNNpulsa currently implementing in order to strengthen the mindset and culture that encourages innovation and dynamic entrepreneurship?

ORTIZ: One thing that people do not know is that Colombia is an award winning country when it comes to innovation. We've won all sorts of prizes, worldwide, for research, biotech, agribusiness, nutrition products, and all sorts of other things. But we have not been able to get that research into the market and incorporate companies able to profit out of their innovations, so that is where we are now. I think that 66 in the ranking is an inflection point. I think that Colombia has come to a point where it realizes that it can no longer invest solely in the research groups, but that it needs to invest in that second part, which is bringing things to the market in a successful way. We are helping both universities and innovation centres to improve the way they can commercialize their research and innovations. We are doing this with various international collaborators, such as the UK, Israel, and Singapore, because it is something that Colombia has not been able to do in the past but is learning now and transferring that technology, so that we are more capable of doing this independently. We had some early wins that made us very hopeful in terms of what we can achieve when universities, the government, and the private sector come together to use that technology and foster productivity and prosperity in Colombia.

In what ways can the Colombian education system adapt in order to effectively teach entrepreneurship and encourage innovation? How do you see this progressing over the long-term?

ORTIZ: One thing that I have seen happening which is very encouraging is people understanding that it is not about the curriculum. I mean, you do not learn innovation or entrepreneurship in a classroom. We have seen a lot of start-ups starting in the top universities of Colombia. We have seen a lot of creative new ways to bring innovation and entrepreneurship. We have also seen a lot of challenges throughout the process. I think that this is the best way that universities can bring these two concepts in. We have also seen that people at university realize how entrepreneurship and innovation is not only about what students can do, but it is also what researchers and professors can do in terms of creating new businesses. I see the glass full, all the time. I am very optimistic because I think there is a window of opportunity where 3 things are coming together.

First, there are a lot of new programs similar to iNNpulsa, such as the public and private programs at a national and sub-national level, where Colombia doubled the amount of resources available for innovation and entrepreneurship from the year 2011 to the year 2012. It is still not as much as other countries in terms of GDP, but we doubled the amount of resources. So there are institutions in place, and there is more money. The most important thing is that there are willing and talented entrepreneurs and business people at all levels, from all sizes of companies, all around Colombia. Some entrepreneurs are using innovation to create new businesses and to grow their existing enterprises. So these 3 things make me hugely optimistic. Yes, we do still have a lot of coming up to do in terms of having more resources available, and in changing our mindsets, but I am very optimistic because I know that Colombian talent and Colombia’s capacity for venturing is amazing.

How would you describe the current state of funding for start up ventures and entrepreneurs? How significant are venture capitalists and angel investors in Colombia?

ORTIZ: It is a newly born industry and as such it is doing its first steps. Private equity in Colombia has been around for a while. However, the regulations that enabled the existence of these funds have only been around since the year 2007 and 2008. So it is a very new industry. We have seen more and more people getting involved, and a lot of people coming from M&A and showing interest in these venture capitals. There has been some interesting businesses and some interesting exits, still very few. But we are confident that the industry, with the support of the government, which is trying to alleviate risk for private investors, can play an important role to spark venture capitalists and hopefully seed funds, which are also important further down the chain.

What are the major success stories for iNNpulsa? Which sectors are showing the best opportunities for growth and development?

ORTIZ: We can talk about the success of iNNpulsa, but I am more interested in talking about the successes of the entrepreneurs that are in the system and speaking about the many innovations we have seen so far. For instance, one of our companies made and launched its first satellite here in Bogota, and the director of the AIM Institute at NASA said that this technology is comparable to the one they have in Silicon Valley, although he liked our business model better. We have innovations that range from satellites to very sophisticated agro-business products, such as quinoa, which is one of the major aliments that the FAO has highlighted, and which, again, is given to astronauts. They have developed a very high value product, integrated all the way around the production chain.

There are Colombian entrepreneurs focusing on cosmetics. I was talking earlier about a company that has developed a way to bleach hair. Women, when they are pregnant or sick, cannot bleach their hair. This is just the first use of a molecule that comes from a fungus, which grows in Antioquia. The second use of it is amazing. Apparently, the first trial shows that it can help you cleanse chemotherapy, so they are using this molecule as a side treatment for chemotherapy because it helps eliminate chemo from your body. So there are opportunities and innovations that range from agro-business to biotech, and there are also a lot of digital initiatives going on. It is too soon to tell which sectors will be the winning industries, but what we are very sure of is that there will be a lot of Colombian enterprises out there.

How attractive is Colombia as an investment destination at the moment?

ORTIZ: If you look at emerging markets and if you have some patient capital with which you intend to make some very high returns, I think that investing in Colombia is an incredibly good option. Colombia is right at that point where it is cheap enough to enter and where businesses are going to mature very well. You can wait and see, but if you wait and see things may get a lot more expensive, as has happened in Brazil and other countries. So, I think this is the right moment and time to look for different technologies emerging from Colombia and to invest in Colombia. It is a window of opportunity. I really like what I heard from some of the investors, as they say “You know projects may still be a little immature, but if I get in now, I will get it at the right price. If I wait, I will probably get in at a higher price”. You can get into Brazil now, but you are paying for a Brazilian premium. Other markets may not be as interesting because there is not a strong commitment from the government to mitigate the risks, or the internal market doesn’t have a critical mass strong enough for you to prove your product internally.

In Colombia, there are levels of connectivity and the government’s commitment to connect more than half of the population. All of these elements add on to Colombia’s competitive advantages and explains the levels of interest right now. Furthermore, among the incentives available in Colombia, we have seed capital grants and credit lines, which are very easy and cheap. We also try to make all of our incentives open to both nationals and foreigners who establish their company in Colombia.