Fourth Week: Business Models and, oh, did we mention networking?

Colombia Summer 2012 Blog

Written by: Jennifer Jordan

July 24, 2012

That's right it's the fourth week and now we are really into it.  On the technical side the teams are deep in Python and Django, have done a system design, and are starting work on their minimum viable product or prototype.  On the business side it's a steep learning curve to get from thinking about the customer and product to figuring out exactly how and why they will pay.  In fact, many start-ups find that they won't really know what the model is until they get that minimum viable product in front of customers and start understanding what the customers want and where they see the value.  

Still, we spent some time looking at different business models and channels from single to double-sided markets to direct and indirect channels.  Then we brought in some friends to help.  

Have I mentioned yet how strong, deep and international the MIT community is?  Well it is.  The reason we are, and the reason I personally am here, is that my cohort from the first-ever MIT EMBA program, Vladimir Ramirez, decided that Latin America, specifically Cali, Colombia, needed MIT AITI and that the Universidad ICESI would be a great partner (Gonsalo Ulloa, Director of the Engineering Department, his colleague Juan Carlos Munos, and Entrepreneurship Professor and ICESI Start-Up Lab director Andres Felipe Otero are proving this is absolutely the case). Vladimir convinced me to come teach and he was right--we have terrific entreprenuers here.  

And they have been lucky that we have some great Colombian MIT and MIT Sloan grads.  Last week Sloan Fellow Carlos Sierra, an early entrepreneur in the Colombian mobile market spoke via Skype and answered questions on mobile market trends, working with the Colombian mobile operators, and what advice he could offer on forming a new start-up team.  This week Fernando Cardenas, who brought Lo-jack to Colombia, served as the CEO of Lo-jack Brazil, and was a partner with Colombia's Promotora venture fund, talked about the experience of bringing new technology to new markets and discovering that the value for the customer might be different in different countries. When the value is different, the company may need to modify its business model to deliver and capture that value.  But the company must also ensure it has the skills and capabilities to make it worthwhile to serve the market. Fernando spent time with each team, listening to their pitch and initial thoughts on their business models, asking pointed questions and offering some clear suggestions and guidance. Not only MIT, but the whole Cambridge entrepreneurial ecosystem is strong even overseas, as Leah Ramella, a Harvard grad with her own social media content management company, demonstrated when she stopped by to help while visiting with her husband a Caleno (from Cali) private equity investor.

On some of the days, while the teams have been hard at work in the lab, I have been out of the lab networking like mad to build connections for these and future MIT AITI teams in the Cali and larger Colombian entrepreneurial community. Locally, I have met with the Cali Chamber of Commerce (thank you Daniel Zamorano, Nora Hurtado, and Gustavo Vargas, who also spent time in the lab meeting with each team and talking through business models), the new PacificTIC alliance, professors in the computer science and engineering departments at Universidad del Valle, ERP company Siesa (thank you Francisco Opina and the Siesa mobile ERP engineering team), incubator ParqueSoft and its founder Orlando Rincon, and the Cali Executives Club (thank you Sergio Ledesma and Stella Rubiano).  

And I've been on the road, traveling to the the EMTech (MIT Technology Review) Colombia Conference in Medellin to meet Jorge Barrera and other members of the MIT Enterprise Forum in Colombia, the VCs at Promotora, and angels like Esteban Velasco of Tagua Capital.  And thanks to the generosity with their contacts of Christina Kappaz of Cimarron Capital and Carlos Suarez of the US Embassy in Colombia, I was able to meet in Bogota with leaders at the Ministery of Information Technology and Communications' effort (Claudia Obando and Albeiro Cuesta), the Ministery of Commerce (Sergio Zuluaga and Pedro Garcia Herreros) and the iNNpulsa program at Bancoldex (Catalina Ortiz and team), along with our Colombian Google connection Jorge Quiroga (Jorge will be in the lab next week to talk to the entrepreneurs about how to promote their apps within the Google Play store and use Google analytics to see how they are doing). At Google Business Groups Bogota, an independent organization dedicated to helping business people and entrepreneurs get the most of Google technology, I spoke to members of the Bogota start-up community about MIT AITI and what we are doing in CAli and around the world.

Everyone here is aligning to support entrepreneurship in Colombia and a number of the people I met in Medellin and Bogota will be traveling to attend our final business plan competition/Demo Day on Thursday July 26th. But that's not the end of it, next week all the teams will be meeting at the Cali Executives Club with local business people who are have been recommended because of their business savvy and interest in supporting entrepreneurship to meet our teams and become mentors and hopefully potential investors in the future.