So, I think we’ve all agreed that fintech, though still lucrative, is pretty mainstream. But we might still predict what the next tech frontier in Latin America will be, with the lessons the fintech sector has handed on down to us. Namely, that people don’t want bells and whistles, they want their basic necessities resolved. Regional startups are barely just working through the first rungs of the Latin American market’s hierarchy of needs.
This means that if fintech addresses people’s and companies’ need to access the capital they need to do everything else in life, then the next sectors on the up will most likely be those that give Latin Americans the tools they need to create that capital for themselves. Based on this logic, here are a few to keep an eye on in the region in the coming months:
Telecommunications: Even Elon Musk knows you’re not going to get to the vast Latin American market with any tech solution unless those people are hooked up to the web. But it’s how we get those Latin Americans online that will determine what company makes its billions. This begs the question: Is the real race to find a way to get people easy, cheap, and fast broadband or to leapfrog it altogether and go full mobile? Some startups are betting on cheap and fast wired broadband. Others, like Altan Redes, want to become mobile titans. And, then you have the Hail Mary plays like Google’s internet balloons. Who will win? (Investors, probably.)
“People don’t want bells and whistles, they want their basic necessities resolved.”
Edtech: There’s a reason Freddy Vega is something of a celebrity in the Latin American startup world: a common language with high literacy rates and connectivity make this a market with enormous potential — if only people had the skills to make the most of it. “Money has perfect product-market fit,” Vega told me. “That’s why fintech does so well.” So recently, edtech marketing has taken a page out of fintech’s marketing book: Edtech gives you the tools to get what fintech promises you up front — cash. Luckily, the incentives to use edtech’s services in the region as, say, a programmer, are growing at pace.
Logistics and delivery: This one is more of a wish than a sure winner. Latin America is historically a notoriously difficult place to get around — especially once you leave the big cities. Mountainous terrain, relatively few navigable rivers, and poor infrastructure have all conspired to crush once-promising logistics startups. Telecomms are obviously part of the effort to connect the region, but even in an increasingly digital market, people still want and need physical stuff delivered to their homes. To crack this market is, therefore, still the holy grail of sectors: so far impossible to find but going to make somebody incredibly powerful.
