48 Hours in Chile: A VC & Startup Reality Check

I just got back from 48 hours in Santiago, and wow, it felt like stepping into a time machine while also catching a glimpse of where Latin American venture might be headed.

I originally went for Startupchile’s 15-year anniversary. It was a nostalgic trip. After all, this program was born right after the devastating 27F earthquake and became a global case study in how a government can foster a startup ecosystem. Fifteen years later, SUP is still alive, still independent, and still shaping founders across the region.

But in between the celebrations, I packed my schedule with investors, entrepreneurs, and policy folks. Here are the five things that stood out:

1. Challenging times for Mid-size funds

Funds in the $10–20M range that raised pre-pandemic showed solid performance in their first vintage, thanks in part to CORFO’s matching program. But raising a second or third fund has been a struggle. (CORFO deserves a full post on its own—how Chile leveraged public money to multiply private capital is both wild and controversial.)

2. Raising new VC funds is harder than ever

The liquidity drought isn’t just a Chile issue; it’s global. IPO windows are shut, and LatAm hasn’t produced meaningful exits for LPs to get excited about. As Cuantico VC’s 2025 report highlights, 2024 saw a 36% drop in capital deployed vs. 2023 and deal volume down by nearly half. LPs are cautious, and fundraising cycles are stretching longer. Despite this scenario, 3 or 4 funds are performing significantly better, but there’s still ground to cover. (report here)

3. A generational gap, but solid pipeline

There’s a visible gap between today’s managing partners and the new wave of startup founders. But good companies are still being built. The squeeze is really at the seed stage, where checks have slowed down the most. Funds either want to bet very early (pre-seed experiments) or much later (post-Series A), leaving a dangerous funding valley in between.

4. Secondaries are heating up

Secondary markets are becoming a creative solution. Firms like Attom Capital are building vehicles to give liquidity to early investors and employees. It’s still a bet on the bet (assuming those companies eventually succeed), but it’s one of the few tools keeping cash flowing back into the ecosystem.

5. Small but meaningful exits

Finally, we’re seeing sparks of activity. PE firms are circling looking and actually buying software companies making a million dollars a year in revenue, one example of this type of firms is Constallation. Well-capitalized startups are buying strategically. One example is the giant SimilarWeb buying the local startup Admetricks, or a more recent one of Buk acquiring Bemmbo to launch Buk Finanzas. Moves like this help recycle talent and capital, and, for sure, create generational wealth for founders and employees; however, they don’t significantly impact VC fund returns.

The good news: Chilean funds and founders are increasingly regional. Nobody’s thinking “Chile-only.” And despite the funding drought, the energy among founders was contagious, confident in their products, creative with growth, but also pragmatic about the realities of fundraising in 2025.

It was refreshing to see an ecosystem still grinding through tough times, still producing companies worth betting on.

Bonus: here’s a list of funds and accelerators currently active in the country:

• Magma Partners

• Chile Ventures

• Fen Ventures

• Alaya Partners

• Taram Capital

• Platanus Ventures

• Kayak Ventures

• Manutara

• Magical Startups

• Startupchile

✈️ Next stop: I’ll be digging into a very unexpected place to build and grow your startup.