In this 2nd Annual Scorecard on the venture capital and private equity (VC/PE) environment in 12 Latin American and Caribbean (LAC) countries, the Latin American Venture Capital Association (LAVCA) and the Economist Intelligence Unit (EIU) chart the region’s strengths and weaknesses. The 2007 Scorecard covers Argentina, Brazil, Chile, Colombia, Costa Rica, the Dominican Republic, Ecuador, El Salvador, Mexico, Peru, Trinidad and Tobago, and Uruguay. To allow extra-regional comparisons, it also provides scores for Israel, Spain, Taiwan and the United Kingdom.
The 2007 Scorecard reveals the potential for growing VC/PE in the region. Many nations have shown recent momentum toward industry-specific legislation. Investors seem to be noting the region’s increasing awareness of the macroeconomic benefits of a vibrant VC/PE industry. Regional fundraising rose from US $1.3 billion in 2005 to $3 billion in 2006, and investment levels have quadrupled (from $1 billion in 2005 to $4.3 in 2006). 2007 scores demonstrate progress in many countries to promote VC/PE, but reveal that the region as a whole is held back by the broader problems of weak judicial systems and international perceptions of corruption.
While LAVCA and the EIU note that fund managers operate successfully in many ranked nations, often irrespective of score, the objective of this Scorecard is to serve as a guide to encourage reform and track changes over time. As such, eight key findings emerge from the 2007 Scorecard.