What The World Can Learn From Chile
From clean water to culture that’s on the cutting edge, here’s Chile’s secret to ensuring everyone has the opportunity to take part in its prosperity.
Chile’s per-capita income is the highest in South America
In the span of three decades, Chile has transformed from a debt-ridden military dictatorship to what is widely considered Latin America’s strongest economy. The country ranks No. 6 for female entrepreneurs on the Global Entrepreneurship and Development Institute’s Global Entrepreneurship Index. Its per-capita income is the highest in South America, and its poverty rate, at 14.4 percent, is low by global standards. Its Atacama Desert has the highest solar irradiance (rate of radiant energy) in the world — and the potential to produce enough electricity for the entire South American continent.
Chile’s enviable position has in no way come thanks to chance. It’s the result of tireless efforts from government agencies, schools, businesses large and small, nongovernmental organizations, and accelerators, all equipping the people of Chile for success. A common denominator? Inclusive innovation — the idea of a greater good inherent in the development of new products and services, and in the disruption of existing ones. Here’s how Chile is showing the world how to innovate for all.
Innovation for all: What experts in Chile have to say
The Next Generation of Young Innovators
An award-winning building designed by Chilean architect and 2016 Pritzker Architecture Prize laureate Alejandro Aravena may seem an unlikely spot for a social innovation hub. But the Pontificia Universidad Católica de Chile’s CoLab Laboratory of Social Innovation is an important part of the building’s 11 floors of coworking spaces, classrooms and facilities such as 3D printing Fab Labs, where students are working on projects with key players from public and private sectors — including 1,400 partner companies such as 3M and Siemens — to address some of the world’s biggest challenges. It’s the largest entity leading innovation in Chile beyond the government, and social good is its specific charge. “As we think about innovation, we need to be inclusive,” says Sebastian Gatica, CoLab’s founder and director. “We need the diversity and the richness of each individual in Chile — students, companies, universities, government. We all need to work together in this.”
Number of partner companies working with the Innovation Center at the Pontificia Universidad Católica de Chile
Gatica is proud of how far the purpose-driven educational programming has come since he started working in the field some 20 years ago. “Social innovation used to be at the periphery, but now it’s at the core,” he says. Nearly every idea taught and put to the test at the hub provides social, economic and environmental value. Among the work is an initiative announced last August that is designed to address six of Chile’s main challenges — including aging, climate change and the technological revolution — by 2060.
The impact of students’ learnings will likely extend beyond Chile, thanks to the country’s unique take on social innovation, Gatica says. “We have been able to create a trusting ecosystem where we really work together to co-create solutions. If you want to learn about technology, you might need to go to California, Tel Aviv or Helsinki. But if you want to understand social innovation, you need to come to Santiago.”
A Modern Investment Model
Number of small businesses that have benefited from Cumplo’s crowd-lending platform
“Capital is the main fuel in a free-market economy,” says Nicolas Shea, founder of Santiago-based start-up Cumplo. “But the smaller and poorer you were, the higher the cost of capital. So capital was highly restricted to the few.”
Shea talks about this financial inequity in the past tense. That’s because Cumplo, Latin America’s largest crowd-lending platform, is helping to, in his words, “democratize capital.” Through technology, Cumplo allows people to directly lend to each other. “What’s the value proposition?” Shea says. “Investors today are doubling their returns on their investments, and small and medium businesses are finding alternative sources of financing at a much lower cost. That creates a huge benefit for everyone.”
To date, Cumplo’s network of 5,000 everyday investors has helped finance $420 million in loans for more than 1,500 small and medium-sized businesses in Chile. Cumplo hopes to see a similar win-win scenario play out in Mexico, the platform’s first foray abroad. (Despite Mexico’s larger size, the amount of funding directed to small and medium-sized businesses is about the same as in Chile.) Guillermo Acuña, Cumplo’s vice president of technology, says, “We truly believe we are creating a better world. We are helping small companies who were struggling with funding — and now they have a thriving business, they pay better salaries and they have made their investors richer.”
Get the inside story on Cumplo
A recent redesign of key streets in downtown Santiago prioritizes public transit and pedestrians, helping a greater number of people move from place to place more quickly and safely. Travel on major thoroughfare Compañía-Merced — on which more than 50,000 people travel by bus daily — is now 50 percent faster. And sidewalks are 20–30 percent wider, making them less congested, safer and better suited to those with disabilities.
The Chilean Ministry of Health recently implemented a national health records system housed on a cloud-based platform — no small feat, considering more than 1,000 of the country’s remote medical facilities had lacked modern connectivity until then. Related connected-health initiatives such as biometric services and better public alerts further the national aim to provide quality care.
A Sustainable Wine Pioneer
Visitors to FedEx customer Viña Miguel Torres in Curicó, three hours south of Santiago, come to sample wine and take in the vineyard’s verdant scenery. But upon further exploration, many are also struck by Miguel Torres’ commitment to the environment — from its use of non-chemical fertilizers in the fields to solar panels outside the barrel cellar to pallets of recycled glass in the bottling plant. Recognizing the threat global climate change presents to agriculture — including Chile’s nearly $3 billion wine export market — Miguel Torres set sweeping sustainability innovations into motion both in Chile and in Spain, where its parent company is based. “Organic agriculture is very important to us, because we need to be in balance with the environment, and we need to keep it for future generations,” says Rodrigo Constandil, deputy manager of sustainability and quality.
Go behind the scenes at Viña Miguel Torres
Thanks to such efforts, Miguel Torres wines have been certified 100 percent organic since 2012. But the company’s work on the sustainability front is far from finished. Eleven percent of its investment budget is allocated to climate change, which to date has helped research and development teams reduce CO2 emissions by nearly 40 percent and develop more drought-resistant varieties of grapes.
That work bodes well not just for the future but also for the present, thanks to an increasingly purpose-driven customer base in 140 countries around the world — all connected to Miguel Torres in large part by FedEx. “Miguel Torres has a big emphasis on innovation, development and being close to the client,” says Ximena Moran, manager of people and development for the winery. “It is only possible if companies like FedEx are our partners.”
A Power Revolution
Portion of power in Chile generated by solar and wind sources
Stretched out in a valley an hour north of Santiago, 355,000 solar panels soak up the sun. The Quilapilun Solar Plant, which generates enough energy for 110,000 households, has prevented more than 100,000 tons of CO2 emissions since its completion in 2017. The plant also serves as testament to Chile’s commitment to transforming its energy infrastructure. “Four years ago, solar and wind energy represented only 4 percent of all of the power generation in Chile,” says Maximo Pacheco, former minister of the Chilean Ministry of Energy. “Today, we have 20 percent of our total power generation coming from the sun and wind.”
Equally impressive is how the country set this energy transformation in motion by getting signoff from sides often at odds with each other. “The whole process was one of major participation,” says Hugh Rudnick, a colleague of Pacheco’s and professor emeritus of electrical engineering at the Pontificia Universidad Católica de Chile. “We worked with several hundred people from all parts of society — the government, industry and the community sector, as well as NGOs and environmental groups. A very complicated law moved swiftly through congress and was easily approved because it had already achieved consensus.”
Last October, Santiago residents awoke to giant animal figures — among them a 26-foot-tall llama and a Chilean rooster with bright feathers — made mostly of recycled materials. The sixth installment of the Hecho en Casa event was designed to make art accessible to all, as well as to promote the importance of protecting Chile’s wildlife. A Magellanic woodpecker installed atop a tall building provided a poignant example for organizer Felipe Zegers: “This one has come to the city looking for a new home, and it brings us this message that we should take care of our forests.”
Chile already ranks among the world’s top producers of fruit, vegetables and seafood — it has the world’s second-largest aquaculture industry — but those high numbers aren’t stopping Young Innovators from coming up with sustainable alternatives. Santiago-based start-up The Not Company, aka NotCo, produces plant-based versions of milk, yogurt, cheese and mayonnaise. And Puerto Montt–based start-up Food for the Future, which goes by F4F, has developed high-protein, insect-based animal feed for fish, birds and mammals.
Water From Thin Air
Number of people without access to safe drinking water in Latin America and the Caribbean
In Latin America and the Caribbean, 34 million people don’t have access to safe drinking water. In Chile specifically, nearly 200,000 people in rural communities don’t have water supply infrastructure.
Those troubling numbers got Hector Pino thinking — and innovating. As the founder and CEO of Santiago-based FreshWater Solutions, he devised a device to capture micro-particles of water suspended in the air and, put simply, “to form a cloud and make it rain,” he says. Each device — powered by electricity or solar panels — generates up to 7 gallons of water a day. “There are people who can’t afford to buy bottled water, and this allows them to have an unlimited water solution that doesn’t expire,” Pino says.
With support from Start-Up Chile and other funders, Pino aims to bring his solution to the most remote parts of Chile, not to mention the rest of the world. His devices are already bringing water to more than 3,000 families in remote towns throughout Chile. Beyond the clear benefits of providing a basic need, the trickle-down effects of the clean-water innovation are significant — from higher school attendance rates to lower consumption of plastic bottles. “This allows us to reduce the carbon footprint,” Pino says. “But I really like the impact it’s having at rural schools and kindergartens, where attendance is up 28 percent because children have quality water that improves their health and quality of life.”
Positioning the Best for Success
From the street, the home base of Start-Up Chile looks like an ordinary office building. But five floors up, elevator doors open to an indoor/outdoor coworking space buzzing with activity. There’s booming business behind the buzz: As Latin America’s largest start-up accelerator — and one of the world’s 10 largest — Start-Up Chile has supported more than 4,000 entrepreneurs and 1,400 start-ups with a total valuation of $1.4 billion since its founding in 2012. “If you’re an entrepreneur, Chile is the place to launch your start-up,” says Sebastian Diaz, Start-Up Chile executive director and CEO.
Number of entrepreneurs Start-Up Chile has supported since its founding in 2012
Created by the Chilean government and since emulated by the governments of 50 other countries, Start-Up Chile was designed to position the country as a global innovation hub and boost its entrepreneurial ecosystem — a challenge given the country’s prevailing mindset, which favored jobs in established sectors. Start-ups from more than 80 countries have joined those from Chile in gaining access to benefits including equity-free funding and coworking spaces, not to mention nearly 1,000 networking activities and events a year. One of the top programs is The S Factory, a four-month pre-acceleration experience for start-ups led by female founders. “The possibilities are infinite, and the opportunities are here,” says Paula Enei, head of international networks.
PHOTOGRAPHY BY: Burt Pittman