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What’s Happening in Guatemala—It’s Not Just Migration

This article is more than 4 years old.

Two local leaders bring jobs and innovation to a struggling country

For many, Guatemala is synonymous with migration. The most populous Central American country, its 16 million citizens endured a brutal, 36-year civil war that ended 25 years ago. No doubt many Guatemalans have wanted to escape due to the poverty and gang violence that plague the country—nearly 60 percent of the population live below the poverty line and nearly a quarter of the population lives in extreme poverty.

Yet good news abounds in Guatemala. Plenty of Guatemalans want to stay in their home country and are thriving there. It is, after all, a stunningly beautiful place. I have fond memories from my time as a graduate student in 1998 living in the city of Antigua, a UNESCO World Heritage Site. I studied at an intensive Spanish language school and was captivated by the attractive Spanish colonial architecture and the hospitality of the Guatemalan people.

Today, Guatemala is home to a surprisingly strong entrepreneurial ecosystem brimming with innovation and strong leaders. The country’s established industries include customer service and communications, tourism, and textiles. In addition, the government of Guatemala recently passed legislation to improve opportunities for entrepreneurs and provide tax incentives for economic development. This significant development, paired with a great climate, incredible natural diversity (37 volcanoes!), and 2.8 percent GDP growth rate in 2018, and you’ve got a recipe for abundant economic growth. 

I’ve encountered two entrepreneurs who exemplify Guatemala’s bright future: Angel Sarat and Maria Zaghi. In 2014, Sarat and Zaghi were students in my Case Western Reserve University massive open online course (MOOC) Beyond Silicon Valley.

Educating and Connecting the Masses

Maria Zaghi lives and works in Guatemala City, the capital of her country. Armed with a charming smile and quick wit, Zaghi is an indomitable force in business and academia.  She is a professor at several universities, including Universidad Del Valle in Guatemala and UNITEC in Honduras, and she is an ICT (Information and Communications Technology) expert and consultant.

Zaghi also works with GrafiaETC and Ergocom, two commercialization and marketing firms that support Guatemalan technology and education hubs. Operating throughout the country, the hubs provide entrepreneurs with opportunities to initiate an entrepreneurial venture; they open doors and have a growing number of investors, donors, and entrepreneurs (many of whom are international) that are willing to invest and provide resources to Guatemalan startups. Zaghi believes that GrafiaETC, Ergocom, and the hubs they support create a very positive ripple effect, providing startups a big boost in several areas including real estate, business networking, governmental regulation, finance acquisition, and commercialization.

More hubs are planned—and because of that, networks and opportunities for Guatemalan entrepreneurs are growing. By being a part of either company’s directory, the hubs can find new and innovative resources for their entrepreneurs.

Proving Technology’s Feasibility

Another successful Guatemalan entrepreneur and mentor is Angel Sarat. An active member of the GrafiaETC and Ergocom networks, Sarat volunteers as a mentor to young entrepreneurs through Micromentor.org, an online organization that matches entrepreneurs with experienced business professionals.

Sarat’s got plenty of expert advice—he’s co-founded and operated two companies of his own. In 2016, Sarat started Mobile Integral Services Development of Central America, S.A. (DSI de C.A.), a company that helps small and medium sized businesses (SME’s) explore how technology can improve their current operations. They also provide technology solutions to larger companies in Guatemala such as Banco GyT Continental, SA. In 2016, their business intelligence platform, Movilizandome, (“Mobilizing Me” in Spanish) was named the most innovative business solution in Guatemala by Microsoft and the Economic Ministry.

Locomotion Technologies Inc., a Miami-headquartered company co-founded by Sarat in 2017, focuses on Big Data, AI (Artificial Intelligence), IoT (Internet of Things) and Virtual/Augmented Reality. Locomotion has two teams: 16 developers in Guatemala and 12 in Miami. Sarat makes regular trips to Miami every two months but largely operates the company from Guatemala where he hopes to see large-scale future development.

Using AI, Locomotion Technologies developed an app that provides logistical guidance to first responders and government agencies in the aftermath of a natural disaster. It connects insurance companies to those affected by the calamity to expedite and aid processes between both parties.

Harnessing the power of virtual reality, Sarat’s company also built an innovative technology that allows musicians to provide their fans with virtual concerts. In the app, sponsors can market outfits, apparel, and accessories to artists and fans.

Locomotion Technologies is currently developing a proximity glove and mobile app for visually impaired people that offers substantially more support than a white cane. When aimed by the wearer, the glove scans the environment and verbally relays information about potential obstacles. Sarat’s dream is to “give freedom to blind people so that they can interact with others and their environment.”

Making the Ecosystem More Inhabitable

Political and economic instability undoubtedly hinder the potential of Guatemala’s economy. This doesn’t stop Sarat and Zaghi from making progress, nor should it stop other Guatemalans from realizing their futures as entrepreneurs. Zaghi said that because of entrepreneurship, more citizens are excited to participate in society by following regulations, paying taxes, and exploring tech opportunities that are now available.

Zaghi has also encouraged lawmakers to create governmental guidelines that support startups. Her efforts to meet with government officials and presidential candidates have produced results—on July 18, 2019, the Guatemalan government took a significant leap forward and passed the Law on Strengthening Entrepreneurship to expedite the process of setting up a company. Zaghi notes that before this law, “words like venture capital didn’t exist.” She also says that the government can now more easily “develop the foundations” necessary to support crowdsourcing and cryptocurrency, areas young Guatemalan entrepreneurs are starting to experiment in.

According to the Economic Ministry of Guatemala, this new law will support “…the creation of more productive companies in the most influential regions of the country.”

The Guatemalan diaspora has become a significant source of funding for local startups. Sarat and Zaghi hope that Guatemalans who have found success outside their home country will also provide their fellow countrymen with international contacts to advise or invest in fledgling Guatemalan startups or offer employment opportunities if they choose to expand their business into Guatemala.

Both Sarat and Zaghi have proven themselves skilled entrepreneurs, advisors, and champions of Guatemala’s entrepreneurial ecosystem. Still, they aren’t satisfied. Complacency is not a quality that entrepreneurs possess. Continuing to push for progress, Sarat and Zaghi’s efforts will provide more Guatemalans the opportunity to realize their dreams through entrepreneurship. 

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