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Peru VC Interview – UTEC Ventures

Evelyn Gómez is the Program Manager for UTEC Ventures. We recently got together in Lima, Peru, to discuss the startup and venture capital scene in Peru, along with her role at UTEC.

Evelyn Gómez, Program Manager

The interview has been edited for clarity.


How did you get involved in venture capital and startups?

Actually, I started as an entrepreneur. Five years ago, I created an EdTech company called Tullpi with my best friend from university. When we started, I didn’t even know what a startup was because they weren’t that popular in Peru at that time. We made educational games for kids to learn concepts while playing. It had a digital component through a tablet and a physical part that they played with. Similar to Osmo in the US. We launched in Peru and Chile, but in the end, we didn’t find product-market fit. It was many years ago, and we made a few mistakes and got a lot of great learnings. After that, I started working at WeWork, one of the big startups beginning to operate in Peru at that time. I was part of opening the space here. After WeWork, I worked in the government, leading Startup Peru, a fund that gives seed capital to tech entrepreneurs. After that, I joined UTEC Ventures. I was actually part of the first generation of ventures that went through the program when I was running Tullpi, so it was like going back home.


Can you explain more about your experience with Startup Peru and what they do for the ecosystem?

Startup Peru is a government fund that gives non-refundable grants to tech entrepreneurs. At the time, our fund was about $2M per batch, and we offered two types of grants to startups. One was for $15K in Seed capital for very early companies. The other was for $40K to scale up businesses already in the market and had sales. Beyond the funding, I think the big contribution from Startup Peru was when people were creating startups, they’d think of it as a way to dedicate their full-time to learning how to create a business and make their startup grow. Without that initial capital, if you’re working to make a living instead and delegating 10 hours per week to your startup on the side, then you’re limiting yourself. Startup Peru’s capital gave entrepreneur’s the opportunity to dedicate 100% to make their startup grow. I also think that another contribution was making this startup thing more popular because part of the program also provided funding to incubators and accelerators all around the country. It also offered an angel investor network and a VC fund. Through these initiatives, we built other centers for entrepreneurs to help their ideas grow in many cities, not just Lima.


So now you’re at UTEC Ventures, what part do they play in the startup ecosystem here?

UTEC Ventures is an accelerator backed by the University of Engineering and Technology here in Peru and is actually part of one of the biggest enterprise groups here. The group contains several industries, including mining and construction, that supported the university’s development in 2012. They wanted to build a format to create talent and have more engineers and people involved in tech locally. UTEC Ventures was born along with it. Before the pandemic started, we used to give Seed money to startups for equity. We supplied $50K to each startup split between cash and services, and now we are currently in our 10th batch.


How are the programs typically structured?

Each program lasts between 3-4 months, and we’ve had various startups go through each one. We’ve had a batch of four startups and another with nineteen, so it really depends on how many applicants at each time are a good fit. Our current batch has nine startups going through the program, and actually, this one is all female founders. We are close to the end of this one and have our demo day in a couple of weeks. We have our next cohort starting in September.


What does your role as a program manager entail?

I got into UTEC Ventures last November, and we had this new vision to start working with corporations to launch open innovation programs. And so that was my mission from the start. So I build corporate partnerships and design the programs and curriculum for these companies. Now we are running a program named the Future of Food with Alicorp, the biggest CPG company in Peru and one of the biggest in LATAM. This month, we are launching a program focused on innovation in ConstructionTech and PropTech with five corporate partners that we’re excited about because we have a big challenge here in Peru. 70% of the houses are “out-of-construction,” which means they are not as structurally secure as they should be, so this program will help create solutions to that problem.


Well, that’s really important because literally just last week, someone sent me an infographic asking, “Did you just feel the earthquake here?”

Yeah, if a big earthquake occurs, it’s estimated that 70% of Lima will go down. Lima is a huge city, so you can see these buildings in other parts outside of where we currently are. It’s a big problem. By setting up this program, I’ve learned that it usually takes 19 years to build a house in Peru. People will make the first floor, and then later, when they have more money, they build a second. Then the third floor for all their family. It’s a very inefficient process, as they don’t have access to credit. Also, 70% of workers in Peru are informal, which is another factor. So we are looking to solve a lot of these problems through this program.


Walk me through the structure of these programs.

We have one-on-one mentoring sessions with all participants every two weeks and a weekly group mentoring session to check in on their biggest goals and challenges for that week. We also set up experiments and expect results every week. This helps a lot because they need to move really fast and execute. We also invite local subject matter experts to run sessions, which is great because the community here wants to help. So if we’re going to talk about talent, we can invite a founder who has a talent-focused company. If we’re going to talk about investments, we can ask VCs to discuss that topic.


So the startup and mentorship community here is essential for what you’re doing. What is the startup support ecosystem like here, and how has it changed over the last few years?

I think it has grown a lot. In the beginning, it was focused mainly on Lima. And now you can find people are doing awesome things all around the country, and that’s great. There are more and more people getting into this community, investing or as mentors, for example. Even since I started at UTEC Ventures, I receive many emails from people telling me they want to be mentors, which is great because they really want to help in different fields of expertise.


What about on the investment side of things? I know there’s a lot of capital coming to Peru from funds based out of Mexico, Argentina, and Chile, but is there capital based here?

In Startup Peru, we had a fund of 5.4M Soles, which is around $1.7M to help VCs in Peru by covering their operational fees. In general, to have a profitable fund here, it needs to be at least $10 million or more. It’s hard to raise that amount of venture capital here, so that’s how we tried to help. There is another government organization called Cofide trying to launch a fund of funds to help build more VC financing in Peru.


Well, we’re sitting in a nice neighborhood, so there is money here in Peru, just not in VC?

Yeah, there are wealthy people here, but not all of them want to take the risk. But I think most of them are participating in some way with family offices or angel investing.


Other than the sectors we discussed earlier, what are some other critical areas of opportunity that you see startups here working on?

We have a lot of FinTech startups here, just like everywhere else. The opportunity is definitely here, though. Not everyone has a credit card or access to a bank account. We have a lot of informal work, as I mentioned in construction. Not everyone has access to loans, so we have a lot of startups working on that. For example, we have a startup called RebajaTusCuentas that helps you with financing. We also have a lot of digital money change platforms, and a Neobank called B89. I think we have a big challenge in FinTech, so that’s why we have a lot of startups working in that area.


What do you think the biggest challenge is getting the Peruvian startup ecosystem to the level of Mexico or Brazil, for example?

The market here is small, so you need to go beyond Peru. And we don’t have the kind of financing that you may find in Colombia or Mexico. So if you’re building something here, and someone else is building the same thing in Mexico, they will grow faster because they will have more access to investment. They will also have a bigger market to run experiments and fail more. For example, Mexico City alone has 20 million people. In all of Peru, we have 30 million.


Where do you see the venture capital startup industry in Peru five years from now? Where do you see all of this heading?

I think we will have more people investing in startups, And I think we will have startups with bigger, more ambitious ideas. I think that’s what we need now because we don’t have any unicorns in Peru. But just this week, EdTech startup Crehana raised $70, which never has happened here in Peru. So I think that things like that will inspire others to think bigger and make more significant efforts to go beyond Peru and start working on new ideas. I think it’s important to have these role models so founders can see that they can do that too.

For more information on UTEC Ventures, please visit their website.

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