Miami — Many great startups fail before their time because they run out of money and aren’t able to raise outside capital. And many others without a lot of traction - or any at all - are able to raise millions of dollars and buy themselves significant runway.
So what’s the trick?
“I think there’s an educational gap in the VC industry in Latin America,” said Claudio Barahona, Managing Partner at Alaya Capital, and the creator of ComoLevantarCapital, an online academy that teaches entrepreneurs how to raise money in Latin America. The classes are offered in Spanish.
“It’s something I would have loved to have when I was a founder, because I learned this game by failing,” Barahona said.
Barahona, who is based in Chile, built and sold an esports company when he was 25. He has since become an investor, and said that for the last several years, many entrepreneurs reached out to him on LinkedIn asking for guidance on how to raise money. Overtime, he realized that a lot of the questions and doubts were the same. As a result, he decided to launch an online academy that consolidates all the information.
“The other day I did the math, and over the years I’ve helped founders raise about $200 million,” Barahona said.
ComoLevantarCapital is less of a business venture for Barahona, and more of a way to invest in the ecosystem. The academy offers at least one free class, and then the more complete course is about $200 and offers 10 hours of lessons. Lessons include how to put together a pitch deck, what documents you should have ready before reaching out to an investor, and even how to write a cold email to the likes of Sequoia and Andreessen Horowitz, the famed Silicon Valley VCs.
“Most Latin American founders think it’s impossible to get in touch with Sequoia and Andreesen Horowitz, so we teach you how to get in touch with these guys. It’s an email or a twitter away. It’s not impossible,” Barahona said.
$200 is a nominal fee and certainly won’t make Barahona rich. He said he charges a fee just to cover his expenses. I also asked him if he uses ComoLevantarCapital as a method for deal flow, and he said “no.”
“It’s a personal initiative and I make an effort to separate the class from my work at Alaya Capital,” he said.
Right now Barahona is the only “teacher,” but he hopes that more VC’s will donate their time and insights to the platform.
“The challenge is that it takes a lot of time. It took me 10 months to get these first classes online and I was working only on Saturdays,” he said.
“For me, it’s important that it’s not just a platform from Claudio, but a platform from a lot of VC’s. That’s the big vision.”
Fundraising in the U.S. vs LatAm
Most founders have heard of Y Combinator, the holy grail of startup accelerators that’s based in Silicon Valley. As the “Harvard of Startups,” the company has built out resources for founders which they call “Startup School,” but for starters, all the resources are in English. Secondly, the insights and advice are geared toward the U.S. market, and finally, just a portion of those resources focus on how to raise money.
“In the U.S. you can do a Series A of $20-30 million with a powerpoint and a good team,” said Barahona, explaining that round values tend to be lower in LatAm and that investors often want to see more traction. A great idea and a great team are not enough.
