2020 was a year that, like many startups in the country, forced us to think differently and prioritize our energies in order to fulfill our purpose: to help the local and national ecosystem by creating value for the entrepreneur, the innovator, the social influencer, the researcher, the intra-entrepreneur and ultimately, those who carry the weight of the ecosystem on their shoulders.
Startup Genome and the Global Entrepreneurship Network (GEN), two of the world’s leading entrepreneurship organizations, recently launched the Global Entrepreneur Ecosystem Report 2020. This is a research piece on entrepreneurship (with interviews conducted with more than 10,000 entrepreneurs around the world), which classifies and rates the value of entrepreneurship and the ecosystems in which they were born and developed. The report can be accessed here.
In the global ranking, the best-ranked ecosystems are Silicon Valley, New York, London, Beijing, Boston, and Tel Aviv-Jerusalem. Bogotá is included in the “emerging” ecosystems (led by Mumbai, Jakarta and Zurich), along with the other four cities in the region that make up the ranking. Bogotá appears behind Mexico City but ahead of Buenos Aires, Santiago de Chile and Curitiba. Medellín is not mentioned.
The launch of the report comes at a critical time when 4 out of 10 startups worldwide have 3 months or less of liquidity in the wake of the pandemic. This means that these companies will collapse if they do not access additional capital or are unable to change their income and expenses, risking a massive extinction of the entrepreneurial ecosystem that took years to consolidate. According to research by Startup Genome:
- About 72% of startups saw their income fall since the beginning of the crisis
- Average drop in revenue is around 32%
- More than 60% have laid off employees and/or reduced their wages
- About 33% of jobs were cut.
Due to the coronavirus, the flow of capital was stopped or slowed down, while investors stopped investing in new portfolios, prioritising those in which they already have investment.
Today the goal in Latin America is to survive and not scale, and that is where our commitment as Impact Hub Medellin lies. Reality indicates that once we overcome this crisis, the best-ranked ecosystems will continue to be the best performers. Places like Silicon Valley, New York, London, and Beijing will continue to produce great innovations and create high-level value.
Despite this reality and the harmful effects derived from Covid-19, in 2021 Impact Hub Medellin sought to strengthen ties with our community, provoke more and better relationships between local entities and leaders, explore new areas of impact, create new incubation and acceleration programs and in general, re-understand our role and the meaning since arriving in Colombia in 2018.
For example, we identified the need to support companies led by women in the city and the region, to enhance their business ideas and strengthen their impact. Within this opportunity is where the program “Emprender Mujer” was born, a platform for the support and strengthening of women’s businesses. The objective of the program is to work to reduce the economic inequality gap for women in the territories, create benchmarks for business and entrepreneurial development that diversify and expand the labor participation of women and make their leadership visible. The program has allowed 50 women, most from underrepresented communities, to become included in the entrepreneurial ecosystem, usually open only for those who can normally access the opportunities.
We are excited for the plans and progress we´ve made in 2021 so far and the value this has created for the local ecosystem. While we still are a young entity in the city, we are convinced that we can contribute to the achievement of a better ecosystem, more inclusive and designed so that access to opportunities expands.
Federico Restrepo Sierra
Sebastian Bustamante Gonzalez