10 Facts about Ecuador's Innovative Entrepreneur and Tech Scene
Also known as the “land of eternal spring,” Ecuador is a small country bordered by Colombia to the north and Perú to the south. The Ecuadorian rainforest is home to ten percent of the world’s known species and is one of the most biodiverse regions in the world. Ecuador also leads in early entrepreneurial activity in Latin America, according to the Global Entrepreneurship Monitor (GEM). Approximately three million adults between 18 and 64 years old started a business or owned one less than 42 months old in 2017, according to Virginia Lasio, the director of GEM Ecuador.
While entrepreneurial activity is on the rise in Ecuador, many startups and small businesses still face economic and political challenges to scale. Here are ten facts about where Ecuador currently stands on the technology stage in Latin America.
1. Quito’s entrepreneurial scene is evolving
Founded in 2013, QuitoTech was one of the first initiatives to bring together the entrepreneurial and business communities in the capital city. QuitoTech later evolved into ConQuito, and many other organizations were inspired to follow in its path. Latinnova, for example, hosts events for entrepreneurs and innovators in various places around the city and provides mentoring and a coworking space for budding entrepreneurs in Quito.
Another organization, Quito Lambda, hosts monthly meetups for programmers. For those looking to connect with and receive mentorship from other entrepreneurs and technology professionals, Buen Trip Hub provides coworking space and an accelerator program for startups.
2. YaEsta is Ecuador’s e-commerce leader
In 2017, online transactions in Ecuador generated US$800 million. However, no brick and mortar store in Ecuador is currently generating more than 2% of its total sales online. That leaves incredible opportunities in the e-commerce space, and Internet companies like YaEsta are taking advantage.
Founded in 2012, YaEsta is one of Ecuador’s most successful e-commerce sites, offering consumers an extensive catalog of electronics, furniture, appliances, and more available for delivery across the entire country – from the Galapagos islands to the smallest villages in the Amazon jungle.
3. The government provides incentives and support for e-commerce development
With rising demand for online shopping options, improved access to technology, and widespread use of social networking sites, Ecuador is ready for more e-commerce development. The biggest challenge is the current lack of online products and services. Therefore, many consumers turn to international e-commerce sites such as MercadoLibre, Linio, and OLX to shop online.
E-commerce in Ecuador is just 1% of the total Latin American e-commerce industry, so the government is making an effort to help businesses move online and push the local e-commerce sector forward. For instance, the government established quotas and tariffs on products purchased abroad in an effort to encourage consumers to shop locally. The Ecuadorian Chamber of E-Commerce (CECE) formed to provide businesses with e-commerce certifications and training as well.
4. Internet access in Ecuador is improving
While the rest of the world prepares for 5G, Latin America still has some of the lowest levels of Internet coverage in the world. And although Ecuador reportedly has the fastest 4G network in Latin America, only 36% of families are able to access the Internet from their homes.
Fortunately, there are signs that Internet connections in Ecuador are improving. 42% of Ecuadorians have access to the mobile Internet, and Ecuador ranks sixth among the world’s 58 developing countries for Internet connections. In Latin America, only Colombia, México, and Perú rank higher.
5. China funded a nationwide video surveillance system
Funded by a US$240 million loan from China, Ecuador implemented a national network of 4,300 surveillance cameras, 16 regional response centers, and over 3,000 government employees to diligently watch video footage and respond to millions of 911 calls every year.
The system is called ECU 911 and is becoming increasingly more sophisticated. For instance, ECU 911 can now monitor volcanoes for activity and operate drones capable of night vision. The system is quite controversial, and there are fears of governmental abuse as testing is well underway to use facial recognition to monitor citizens and identify criminal suspects.
6. Quito is a hub for small- and medium-sized software development companies
Quito is Ecuador’s second-largest city and home to many universities that offer computer science programs. The city is steadily rising as a leading software development hub in South America due to its high concentration of technical talent providing services at lower rates than other software development hubs in Latin America.
According to a 2014 study by the Software Association of Ecuador (AESOFT), there were 144 software companies registered as members of the software association, of which 111 were based in Quito, and this number is likely to have risen over the past few years.
7. Ecuador is affordable and attractive for digital nomads
Ecuador is an attractive place for digital nomads because of its dollarized economy. When compared to other South American countries, property taxes and medical expenses in Ecuador are far lower as well. There are daily direct flights to Quito from a dozen US cities making it an extremely attractive place for US remote workers and retirees.
8. Ecuador’s ban on cryptocurrencies still holds for now
In 2014, the Ecuadorian government banned cryptocurrencies in a move to develop its own digital currency instead. The central bank backed the proposed state digital currency. Ecuador was an early mover in the stated-owned digital currency space; however, the Sistema de Dinero Electrónico (electronic money system) ultimately failed. All decentralized digital currencies are still banned in Ecuador today.
9. Ecuadorean Inty Grønneberg was named Latin America’s inventor of the year
Inty Grønneberg is the latest person to be named Latin America’s Inventor of the Year by the prestigious Massachusetts Institute of Technology (MIT). Grønneberg, who is half-Ecuadorian and half-Norwegian, co-founded Ichthion (formerly Remora Marine) with Robert Rouse. The startup is currently based at the Imperial College White City Incubator and is developing cutting-edge technologies that promise to rid the world’s rivers and oceans of plastic.
10. ActiVaR is Ecuador’s first immersive training program
The Ecuadorian government launched ActiVaR in October 2018, an immersive program that uses VR technology to help students enrolled in public technical and technological training centers develop the practical skills needed to find work. The program is a first of its kind in Latin America and will help inform policymakers about the potential of immersive technology throughout the region. The Korea University of Technology and Education (KOREATECH) and the Korea-World Bank Partnership Facility are collaborating to finance the project.