Latin America is set to become a global powerhouse for innovation. Here's why

Latin America has made remarkable strides as a key hub for innovation and entrepreneurship.

In 2022, more than 220 startups were founded across the region. Moreover, the emergence and exit of renowned unicorns and the arrival of significant venture capital firms such as Sequoia, Andreessen Horowitz and Accel Partners, and accelerators such as Y Combinator, have firmly positioned the region on the global map for startups and entrepreneurial enthusiasts worldwide.

The latest edition of the 1,000 Global Startup Ecosystem Index 2023 saw the rising in rank of 77 cities from 11 countries in the region, with stalwarts such as Brazil, Mexico, Chile, Colombia and Argentina surpassing more established innovation markets outside of Latin America.

What factors have contributed to the emergence of Latin America as a prominent hub for innovation and entrepreneurship? How did the interplay between the public and private sector contribute to advancing the region's status as a fertile ground for the creation, growth and prosperous expansion of startups?

Let's examine those questions and hear insights from five members of the World Economic Forum's Innovator Communities, a group of leading startups, scaleups and unicorns.

Latin America has historically grappled with challenges that remained unaddressed for a long time. Unmet needs, such as consumption accessibility, banking and payment solutions, were not addressed by the public or private sector for many years, paving the way for local entrepreneurs to seize substantial opportunities and create solutions for these waiting-to-be-solved problems. This was a great chance for entrepreneurs to both test new ideas and replicate models that had already been proven in other markets.