I read recently an article by Marek Fodor, a Spanish Business Angel and founder of the sites Atrapalo.com and Elecciones.es. As it’s in Spanish I’ll summarize his main points as to why 2012 should be a bumper year for Spanish start-ups:
1. There is a growing proliferation of incubators and accelerators for start-ups. These include Seedrocket, wayra and Tetuan Valley. These entities can give valuable business knowledge and pass on relevant contact links to new start-ups.
2. There is a big increase in investments available at seed stage for start-ups. There are a growing number of entrepreneurs with experience of launching successful start-ups, and larger entities like Telefonica and BBVA are also investing in the sector.
3. A proliferation of start-up events for visibility that give initial projects impetus. These are creating a lot of get-togethers with competitions and prizes for start-ups … Each of these events is an opportunity to network, attract early adopters, nab initial customers, and generally to create some interest and hype.
Of course he makes good points, and I tend to agree with them. Indeed, I think there is already a surge of start-ups bursting forward in Spain. Ecommerce in the country rose 23% in the first quarter of 2011, marking 8 consecutive quarters of growth in that sector (source: Ojointernet.com). We are also seeing sites that are aiming for an international audience. For example MedTep, Moodyo or Masterbranch are three recent launches that aim to make it big in their sector on an international basis.
Why specifically Spain? Well we are actually seeing start-ups bloom in many countries – I’m sure followers of (for example) the Turkish or Polish scenes will be able to confirm this too. I think in Spain there is an added impetus to all this. Many talented young (and not so young) people have limited job options in the current economic situation. Also it is one way of overcoming the high cost of starting a business in Spain – you can start a website or create an app at very low initial cost. Give the geeks time on their hand, and the technology to play with, and they’ll end up creating things. It also helps that Spanish is spoken by a lot of people world-wide, so there is a potentially large market in that language.
Of course the main obstacle to the growth in Spanish start-ups, as with anyone else, is breaking into the international market. They do have the advantage of their language in Latin America, but they aren’t yet as big as they should be on the European stage. There are exceptions of course, and we’ve already seen breakthroughs like Busuu (a social network for language learning) and Fon (wi-fi router suppliers to the world). 2012 may be the year that Spain makes the big international breakthrough in start-ups. But in order to do this, they will in certain cases have to break into the English-speaking world – the lingua franca of the internet world. At that level, automatic translation tools are still far from adequate for the job.