For years, the Biotechnology sector has remained under the optics of local traders as a world full of risk, instability and also with a certain degree of elitism in relation to those who may be selected members who may have access to this world so dangerous, but in turn so attractive.
The right thing is that within the bias that was built on a local level, in Latin America, but mainly in Argentina, we have been able to build a sesgada structure that separates much from the reality with which we work daily in Biotech. That is: access to major global development and research centers only via certain discrete groups or intermediates, vertical-type work dynamics, excessive marketing use to provide a false sense of exposure to a national market with global projection, scarce circulating information among the founders, among others.
Unlike other neighbouring countries, Argentina is considered worldwide as a country that both in the pharmacological part and in agriculture, has never ceased to be under the magnifying glass of the main Biotechnology markets. On the contrary, it is not just reference, but it is leader. And with that, it is not assumed that the rest of the countries have no talent or abilities, otherwise. But the macroeconomic challenges that occur in Argentina give it such a degree of singularity that put it in another group. And this is because still with unprecedented drought and three-digit inflation: within the pharmacological area, Novartis has increased 5 times the number of clinical trials in our country in recent years remains one of the 5 largest and advanced agricultural countries, along with the United States, China, India and Brazil.
" The sea revuelto, gain of fishermen”
If we only take jurisprudence in the macroeconomic spectrum, it is no wonder that Argentine entrepreneurs are characterized by: their versatility, their resilience, their creativity in hostile financial ecosystems. These qualities are critical and key at the time of undertaking. But, as everything cannot be, it is not easy to undertake and at the same time to keep up with both the internal dynamics of other markets. Especially if it's about finance.
Since the world of Biotech is, as it was mentioned in principle, a complex, risky world, but in turn attractive are few who really are engaged in doing the proper market research at national and global level. This implies that there is a minority group that runs with broad advantages over a large majority that does not know key information.
In Argentina, undertaking implies exposing itself to a world where the use and abuse of asymmetric information predominates. The same financial sector does not escape this phenomenon, since without going further the launch of the public offer of Richmond and some years ago the company Rosenbusch, were also involved in this event. Both local companies, which
belong to the scope of Biotechnology, they were covered by local analysts a few years ago and in these reports made the profile of both companies almost fictitious, appealing to wrong data as comparable companies and biased projections.
A true sin since, although the exante intentions were to encourage local development and investment, this kind of maneuvers the only one that generates is the complete reverse effect. Even it could be said that both Richmond and Rosenbusch were victims of this kind of events and that their cost was very high at the financial level.
Within the entrepreneurial ecosystem passes the same, unless what pays the consequences is always, and everywhere, the entrepreneur. The entrepreneur deposits confidence, time and its illusion of all life in funds that have a generally American name behind
to seal your “guarantee” of trust. This seal allows start-ups to piacere almost in a somewhat impune way always under the premise that accompanies them and helps to scale the business out.
However, when inquiring about business and investment models, it rarely occurs and not because of lack of talent, all the opposite. Feel by questionable business models that are far from correlating with the real market dynamics in the Bio world.
Let's see.
In Argentina, many investment funds defend a model that defends a follow-up from the initial phase (lease “idea”) to “Serie A” and call it “MVP Step”. This is fake. The MVP stage is a stage where the technology and/or hypotheses are sought to validate and then raise a new capital round. Read “Etapa pre-semilla”, validation and series “Semilla”. The “Serie A” is a stage where you have an already mature product and ready to climb. In terms of financing, although Argentina has an economic context where the exchange rate causes investment in dollars to be younger (it is read that, instead of $100 thousand, a round of USD 50 thousand Now, if you analyze whether the startup is a good fit for the background and assuming that the selection process is successful for the entrepreneur, this process can take a year, year and a half. What is an eternity, especially for a company that does not receive recipes and needs them to survive.
In the real world of Bio, leaving aside the availability of funds, the interaction is not only fast (from 2 weeks to 3 months maximum to decide whether the company is a “si” or a “no” to the bottom), but what really is sought is to enhance ideas. How? It is left free-will at the time of conceiving solutions, tested at pre-semilla stage and seed the feasibility and there is defined by itself or by not ameritating to adjust or climb. As regards networking, it is not only networking with other founders or at the local level, the availability of the academic and market channel to catapult the potential of the proposed ideas. If there is no fondness of part of the funds, other alternatives are enabled.
But always, it is always sought to develop ideas intensively, regardless of whether or not there is capital available, prioritizing and fundamentally respecting the times of the founders who are the ones who are destined all their time and sacrifice themselves to fulfill their dreams.
Considering all these endogenous factors that result totally harmful to the local entrepreneur and the need for the global trade to do business with Argentina, one can say that the entrepreneurial link- local investment fund in Argentina is completely dysfunctional and harmful.
Is it necessary to change it? Yeah. It is necessary to restructure, stop wasting local talent, put under the magnifying glass the Argentine potential to design, develop and execute concrete market solutions. The world has an appetite for Argentina. There is no entrepreneurial profile like the Argentinean that, despite having three digits of inflation, unprecedented droughts and unparalleled tax pressure, remains as a global benchmark in the field of biotech resources, talent and solutions.
From Richmond to Rosenbusch. Laboratories, clinics, farmers, producers, scientists, is time to plant. The price of ignoring and delegating decisions is very high. We need to change, and we need to change things now.
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