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Innovation Act. 22 Aug 2017

David Peña: "We entrepreneurs have to attract investors' attention"

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This entrepreneur spotted a business opportunity when he created a shared workspace in Mexico City to serve as a meeting point for various actors in the entrepreneurial ecosystem. This was a market niche which according to David Peña was not being exploited in the country, even though all the elements were there to do so. Three years ago, this prompted the birth of Centraal. David Peña is one of the 33 leading innovators in Mexico.

Can you tell us a little about your company? What services does Centraal provided, and which sector is it in?

Centraal is a shared workspace, a different space that revolves around a community and a concept of design, that provides facilities for companies –particularly those with a technological basis–, entrepreneurs, and innovative enterprises. We give them a space where they can coexist, exchange best practices, and attend events that in some way enhance their professional lifestyle. That's Centraal, a meeting point in the entrepreneurial ecosystem where all these movers and shakers in our society can come together.

From the standpoint of the business model, Centraal is a real estate company. However, like other new business areas, it has a vertical and multidimensional component that covers other areas. And our approach, from the point of view of the entrepreneurial ecosystem –beyond simply providing a space– is to provide a platform for content, communication and networking  for the whole ecosystem. So as I say, it's a meeting point. The sector we belong to is a little difficult to describe, but our work revolves around Mexico's entrepreneurial communities.

When did you start collaborating with the entrepreneurial ecosystem in the country?

I'd never had an opportunity to be an entrepreneur before, and my first collaboration –or what led me to the world of entrepreneurship in Mexico– came about because of an event entitled Startup Weekend, that we hosted in Centraal in 2013, and which ultimately served as a platform for launching ourselves too. That was our first event, our inauguration, our debut in the entrepreneurial ecosystem. Through Startup Weekend we began to set up relationships and synergies with the rest of the ecosystem, which allowed us to make a name for ourselves and gradually generate value within the ecosystem. And this –always with a highly participative approach, and very much in line with the idea of "coming up with ideas but without expecting anything in return"– is how we've envisaged Centraal's relationship with the entrepreneurial ecosystem.

What was the motivation to create Centraal?

There are two components. The first is that from the point of view of the business model, we knew there was a growing trend all over the world for shared workspaces. This is a new way of working, a new lifestyle option. This concept had still not caught on in Mexico and there were areas of opportunity to make it a reality. This was the first reason from the business point of view, and the second –a little more romantic– was that we wanted to create a democratic space, a space that people could feel was their own, and a space that we could use to bring about change, to encourage the idea of generating value for our society through these individuals who are in some way isolated, underserved, or immersed their own worlds. So they would know there's a space for them.

Do you consider yourself an innovator? Why?

I consider myself a person who's sensitive to some social problems, and who understands that innovation and entrepreneurship are tools that take a different approach to our current problems. This is the way I live. So if that's what we consider an innovator, I definitely am one; and if it's what we consider an entrepreneur, of course I consider myself to be one too.

What do you think are the challenges or obstacles facing entrepreneurs in Mexico today?

I think that in Mexico and Latin America in general there's a lot of talent, but that talent is still not found "en masse". The main challenge is to make a better entrepreneur or a better professional. What I mean is that the barrier is personal –there's no financial barrier. Mexico City is one of the richest cities in all Latin America –and probably in the world– and there are people willing to invest. These people are looking for that business idea that only you can develop.

So I think the main barrier is internal, and that stage of developing better as an entrepreneur and a professional, developing the ideas you have more effectively, and rubbing shoulders with the best, consuming the best content you can, going to the best universities you can, reading the best books you can, fostering in yourself that mindset that will make you an entrepreneur –I think that's the main barrier we entrepreneurs are facing.

If we look at the  role models on a global scale, these people are often intellectual, curious, creative and innovative; and this is because of their capacity to develop these aspects of their lives, to nourish themselves with content throughout their lives. I think that's the challenge, developing our own talent and skills, and exploiting them with a high level of professionalism; I think that's the main barrier facing Latin American entrepreneurs in general.

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How would you define the DNA of the Mexican entrepreneur/innovator?

I think the Mexican entrepreneur/innovator has a fairly strong facility for participating in communities, and I say this based on facts. For example, Mexico is one of the countries which hosts most Startup Weekends. We've experienced it for ourselves in Centraal when we organize events –we see the attendance figures and people's participation. I think the main feature of Mexican entrepreneurs/innovators is their willingness to see entrepreneurship as a channel for developing as better people and not to follow a traditional career path, and to generate value from their own innovation. I think it's that hunger, that spark that makes us want to become entrepreneurs and grow.

This, of course, combined with the political, economic and social system in the country. We see entrepreneurship as an escape route from our current reality to a better reality. And this will be good for the whole of society in the future, because society itself will benefit from the products generated by entrepreneurs.

What are the features of the entrepreneurial ecosystem in Mexico today?

I think the entrepreneurial ecosystem in Mexico is still at a fairly early stage. I think it's making giant strides forward compared with how it was, but seen against highly developed ecosystems, it's still a rather slow process. And by this I mean elements like the support of academia, private initiative, investment funds, and of course the talent of the entrepreneurs themselves, in addition to the regulatory environment of the public organizations and their contribution to the ecosystem. I believe we should focus on generating talent and exploiting our own talent to the maximum, just to underline what I said earlier.

In the three years since Centraal came into existence, I've noticed how this ecosystem has taken some giant steps forward. Today I'm seeing things that I would have never believed could exist five years ago. For example, success stories like the companies Kichink o como Conekta, Kichink and Conekta –cases that we imagined some years ago, but that are today helping consolidating us into an important ecosystem; however we still have a lot of work to do to create more companies like this and make sure this occurs on a massive scale.

In your opinion, what is the role of government and non-government bodies in entrepreneurship?

The government should create a favorable environment for enterprise creation. For example, everything from the most basic process of constituting a company, to generating information for its constitution, and avoiding overlooking any legal aspects, and of course –talking of legal issues–giving us legal protection so we can develop things freely, while always remaining within the scope of the law.

The answer is a little general because that's what governments are supposed to do, but that's it: they should do what they're supposed to do, but better. I'm not convinced that the government should be the only one to give us access to public funds However, as there is initiative and there are resources out there, they should make it readily available so it really reaches the best entrepreneurs, and as a way of promoting enterprise.

Currently, at least in Mexico, the process of assigning resources is still a little confusing, and many of us entrepreneurs don't understand how it works. So there needs to be much more transparency. The government should be an ally of entrepreneurs, and not only a father figure who doles out money; and we, the entrepreneurs, should not play the role of a scolded child. The government should be our brother, someone we see on a daily basis, helping us develop this enterprise, develop the different phases of our company.

From the standpoint of private initiative, on the one hand I think there's a common factor, and that is that many successful entrepreneurs often already come from private companies, and are “hardened”; they learned the trade and generated value for some time in those companies before developing their own enterprise. There's sometimes a perception that entrepreneurship happens between the ages of 18 and 25, when in fact successful entrepreneurship really takes place at a much more advanced stage of professional maturity.

So the first step for private initiative is to give people access so they can develop their creative talent inside the company, so it can really generate value. So we don't just become a country where people have a job from 8 am to 6 pm and go home without generating any type of value. If we encourage the entrepreneurial culture within the organization, these people are eventually going to be able to generate value either inside or outside the company. And that's where the private sector should really go the extra mile to develop these entrepreneurial skills within the organization, in addition to generating opportunities.

How would you define the financial opportunities for Mexican enterprise today?

There's an article about Mexico written by an Argentinian friend, Juan López, in which he refers to Mexico City as a rich city where a lot of things are happening, but where money is not channeled into these  startups with a high potential for growth. I agree with that. Mexico City is a place where there are hundreds of rich people ready to invest, but they're investing in other things. We have to be able to attract their attention, so the money in Mexico City begins to flow towards certain startups, towards high-value enterprises. But it's a little like the chicken and the egg –they don't pay any attention because the enterprises aren't sufficiently strong, and we don't have strong enterprises because they don't pay us any attention or give us any financial resources. So it's a game where we're gradually generating more and more opportunities, and we're certainly going to continue attracting more attention.

There's also another important element: we have the possibility of creating enterprise in Mexico with resources from Singapore or from Silicon Valley. Money's not an obstacle to entrepreneurship. When there's a good idea, good validation, and a good opportunity to scale up the business, money will come. When there's a good idea, good validation, and a good opportunity to scale up the business, money will come. It's our responsibility as entrepreneurs to attract the attention of these investors –Mexican or otherwise– so they invest in our startups.

How do you see the future of innovation in Mexico?

From the point of view of entrepreneurship, it's something that as our society evolves –as we have access to more resources and more information– we'll start to see innovation as something necessary, something that forms part of our culture, like part of our education. I'm seeing more and more people becoming interested in this, and seeing how they're able to generate value through enterprise. I'm optimistic, I think we're going to see some incredible years in Mexico and in the rest of Latin America, when were finally going to come up with solutions to problems we've had for a very long time, and even throughout our whole history. We're finally going to come up with innovative solutions to those problems. Achieving this is a question of time, patience and above all, hard work; so these entrepreneurs can really generate the change our society needs.

What advice would you give someone who wants to become an entrepreneur in Mexico?

I'd tell them being an entrepreneur or an innovator begins on the inside. It starts with that feeling of curiosity and sensitivity towards problems. Not only gathering the information you need to do the job better, but also to really understand the problem. So the specific advice is: just try it. Even if you don't know exactly where to start, try it. If you want to run a marathon, and you dream one day of running a marathon –or ten marathons a year–, the first step is getting out of bed and taking a step to start running. That's all it is. Even if you don't know  which direction you should take that step, it's a matter of doing it, of trying it. And when you try it, you'll find there are variables, you'll get to know people, they're going to recommend books, you're going to understand more things that are going to make you a better entrepreneur. So “Just do it!”, do what you can do, investigate, talk, come to places like Centraal, go to events held in places like the BBVA Innovation Center. Center. Speak to people and start to do it. Eventually find you're moving toward a better business opportunity and you'll even become a better person.

For David Peña, the financial opportunities are no obstacle to becoming an entrepreneur in Mexico today. He encourages people not to use that as an excuse, and for entrepreneurs/innovators to concentrate on working hard each day to attract the attention of major investors who are interested in supporting new startups.