Young Latin Americans are becoming increasingly less eager to work at other people’s corporations and more interested in starting their own businesses. That sentiment is shared by Roberto Musso, who has launched more than 17 companies under the brand Digevo. His firms have a presence throughout the region, with a special focus on the cellular telephone sector. Two of his companies, STI Technology Solutions and AxonAxis, have been sold successfully to multinationals. With an eye on advising the burgeoning entrepreneurs of Latin America, Musso wrote a book titled, “The Valley of Death,” which will be published shortly on the Internet. The title refers to Musso’s feeling that “becoming an entrepreneur is the same thing as going into a valley where the risks cannot be predicted, and the only way to survive is to adapt.”

Musso spoke with Universia Knowledge at Wharton about his personal experiences as an entrepreneur in Latin America. He says that the entrepreneurs of the region have big advantages when it comes to launching projects, despite the numerous obstacles that they must overcome.

An edited transcript of the conversation appears below.

Universia Knowledge at Wharton: I’d like you to talk with me about the various aspects of your career as an entrepreneur. What is the secret of innovating and launching a company that fits with the needs of the marketplace?

Roberto Musso:The secret is that it is a lifestyle. In my own case, I have never had a valid option to work for a company as a salaried executive. From the beginning, I wanted to create and run my own projects…. I am an entrepreneur because I want to be free. This internal proclamation applies to all entrepreneurs, and involves a deep conviction and passion.

I have always been open to opportunities. This openness not only means having an open attitude about observing and understanding, but also means formally evaluating business opportunities.

UKnowledge at Wharton: What does formally evaluating a business opportunity entail?

Musso:When I see an opportunity, I evaluate whether it is capable of creating value — if the product or service I am creating really addresses an important need for customers at such a level that they are ready to pay for it. I also determine the scalability of the opportunity — if … the business is capable of growing rapidly and if there are no limits to its growth. In addition, I evaluate whether the opportunity is profitable enough compared with any other project that I could devote my time to.

Another thing that I evaluate is suitability. That is to say, I try to assure myself that when my product comes onto the market, another competitor doesn’t come along and replicate what I am doing, and offer it at a lower price. Ultimately, it is about protecting the return on sales that belong to me for having been the creator of the product. Just as much, I also evaluate the timing of the opportunity because, as an entrepreneur, I may have a brilliant idea but it may not be the right moment to offer it on the market.

UKnowledge at Wharton: How do you determine the right moment to launch a product on the market?

Musso:You need to have a deep understanding of the industry; to know and understand phenomena in a systematic way. You need to know, for example, that Facebook, Twitter and LinkedIn are manifestations of a social movement, and that they follow a trend in the possibilities and advantages that connectivity can deliver over the Internet. But this has already happened, and no one is now thinking about constructing another grand social network. There are many entrepreneurs who are dreaming up new products and services that operate on these social networks.

Finally, I also evaluate the size of the opportunity and the sales volume I hope to derive from marketing my product in domestic and international markets. Any entrepreneur can follow these practices, but there is something more important about the opportunities.

UKnowledge at Wharton: So what is the main thing about the opportunities?

Musso:The main thing is to dare to take the opportunity. In that regard, I am a bit different because I dare to capture opportunities, although I sometimes lose…. Considering all the companies that I have created, a somewhat smaller percentage of them have been failures [rather than successes]. You have to be ready to fail. What we are talking about is living your life. Life is short and it offers you a finite number of opportunities. You can’t let the days pass you and pass by the opportunities that come up. You have to be able to take risks.

There will always be reasons not to take an opportunity, but if someone needs to be very convinced in order to take a chance, it is probably because he is a person who is very conservative, and he is going to take very few opportunities in life. Good fortune comes in daring to take risks even when doubts exist.

Once you have taken this opportunity, the next step is to prepare yourself and be flexible enough to adapt to the conditions under which you must play. If I decide to move into the mobile world, I don’t know how things are going to work out. But it is clear that I will have to show flexibility with regard to how I adapt to the way things evolve. That’s why I wrote [his new book], “The Valley of Death.” I believe that becoming an entrepreneur is the same thing as going into a valley where the risks cannot be predicted, and the only way to survive is to adapt to the environment, avoiding the risks and taking them to the extent that they are rational.

I am not the one who invented this approach. I did it in an instinctive way throughout the course of my history as an entrepreneur, until I discovered that evolution is a constant process of adaptation. That’s why, in my book, I emphasize that the Latin American entrepreneur must understand his environment and follow flexible business models that enable him to survive.

UKnowledge at Wharton: What are some of the barriers you have faced? Are they the same barriers that other entrepreneurs in Latin America frequently confront?

Musso:The barriers are always the same ones. Three basic elements are required in order to have a successful entrepreneurial initiative: A team that is capable of doing things in the right way, a plan and financing. In Latin America, it is hard to comply with all three of these requirements. When it comes to a team, you need entrepreneurs with a good level of education. That has prevented a larger number of these ventures from being created in the region. If there were [a] good [system of] education, practically everyone would speak English. They would understand mathematics, finance and business models, and they would read the books that you have to read. If good educational system existed, people would not find it hard to send an e-mail to the person who is the most qualified specialist in the world with regard to that specific subject. To do that, you have to speak English, and you need to understand events in a systematic way, through reading and observation.

UKnowledge at Wharton: Is education the weakest point for entrepreneurs in the region?

Musso:Absolutely. An entrepreneur should get started after studying for his M.B.A. That should happen after he finishes school. The current system of education does not prepare people for becoming entrepreneurs. Nevertheless, there are elites that have access to good education and are in better shape to start companies. Although this situation is common throughout Latin America, there are differences, such as in the case of Argentina. Argentine entrepreneurs are well-educated because they can depend on a high-quality educational model that is much more efficient [than others in the region].

Because of the poor preparation and education of entrepreneurs, most projects are not very sophisticated, and they lack strategic analysis. There are, however, notable exceptions, [including]: Wenceslao Casares’ Patagon, an online bank sold to Banco Santander; Peruvian restaurateur Gastón Acurio’s restaurant chain known as Astrid y Gastón; Pedro Medina’s “I Believe in Colombia” campaign, whose mission is to create tools and models for developing the country’s resources and potential; and Matias de Tezanos, who saw a business opportunity in the Internet and bought, converting it into the main site for making hotel reservations in Latin America. To achieve these kinds of results, each of these entrepreneurs made a deep strategic analysis of their project. Today, Latin American entrepreneurs must understand that they are competing in a global world, and must formally evaluate opportunities when they present themselves.

Another major problem in Latin America is financing. There is a huge gap between the developed nations and the emerging nations when it comes to investment in risk capital. It is very hard to get angel investors where the conditions are fair and people don’t tell you, “I am going to invest $100,000 in your business initiative but I want to wind up with 50% of your company [in return for my investment].” Chile may be the exception, since it has managed to build an ecosystem for entrepreneurship, delivering wealth through CORFO, a governmental organization that promotes development. Generally speaking, however, the risk capital investment industry is very difficult in Latin America, and it needs to be redefined at a macroeconomic and political level in order to optimize the rules of the game.

Although almost every country in the region operates under similar conditions when it comes to financing, Brazil is an exception to the rule, given the volumes that are managed in its market and the [resulting] attractiveness to private investors. If there are good projects, investors appear quickly and put in their money. As a result, the main challenge for entrepreneurs in [Latin America] is to develop the capacity to reinvent their model for financing. Nowadays, despite all the barriers involving education, planning and financing, I feel very optimistic.

UKnowledge at Wharton: To what do you owe your optimism?

Musso:A strong entrepreneurial movement is being created among young Latin Americans who are not interested in working for a bank or a company, and want to create and work for their own businesses…. Success stories are cropping up, and they need to be emphasized so that more entrepreneurs join the ranks.

There is another piece of good news when it comes to financing. Today, it is much cheaper to start a business than it was before. With the coming of advanced information technologies, you can have your own cloud-based work platform at an affordable cost, and you can access a complete customer relationship management system for managing your business. You can engage in marketing without having to buy advertisements on television, using certain tools through the social networks. You can even design the logo of a company without having to hire a designer by obtaining the service on You can definitely equip a company using far fewer resources than before. These are the big advantages that Latin American entrepreneurs have today.

UKnowledge at Wharton: What other advantages does the Latin American entrepreneur have today?

Musso: We Latin Americans have just taken a crucial step in our development. Over the past ten years, we have gone from a situation where we were totally unconnected with the world to a situation in which there is instantaneous and global connectedness. We are only one click away from Harvard or Stanford. This transition was very rapid, and it represents a great opportunity because we are now connected globally.

Second, we were poor for our entire lives, and becoming an entrepreneur is accepted nowadays as a way of social mobility. There is a tremendous opportunity when people are connected with the world: They have an idea for launching a business, and they have the desire to become socially mobile, undeterred by risk, and with a lot of [outside] support. Technology and entrepreneurship can wind up being a very powerful combination for the region. Sooner or later, the future Googles and Amazons will begin to emerge in Latin America, offering big plans that address other countries whose needs are similar to those of Latin America.

UKnowledge at Wharton: Are you worried that the image of Latin America is going to be hurt by the recent corporate expropriations — such as of the oil company YPF in Argentina and Spain’s Red Electrica Corp. (REE) in Bolivia — and the populist rhetoric of some leaders?

Musso:Yes and no. I am worried because they represent obstacles for more foreign investment and credibility in Latin America and, above all, because they send a signal that the rules of the game are changeable, and that the agreements that companies reach are not going to be respected afterwards. But these interpretations are incorrect because we Latin Americans believe in agreements and we comply with our promises. In that sense, I am worried. However, on the other hand, I am not worried because I believe that these are exceptions — one more obstacle for us Latin American entrepreneurs, who are used to living in a precarious environment with never-ending pitfalls and barriers.

UKnowledge at Wharton: Must entrepreneurs in Latin America give special attention to the current economic situation?

Musso:They need to take it into account. However, I believe that you have to be an entrepreneur wherever you are, no matter what the circumstances. If the world is undergoing an economic crisis, you need to become active in business because [new] opportunities are emerging for developing solutions that will lower costs. The crisis in the United States and Europe has forced those countries to view Latin America as one of the last oases in the world, a region with political and economic stability and a workforce that is trained, yet inexpensive. All of that provides us with a big opportunity.

UKnowledge at Wharton: In all of your years as an entrepreneur, what has been the biggest leadership challenge you faced?

Musso:One of the most important challenges regarding leadership has been learning how to manage talent. That’s because there are moments when you have to know how to inspire and lead people, but there are other moments when you have to know how to listen, especially when you are in charge of a lot of people and some of them know more than you do. So you have to establish a balance between knowing how to respect, listen and accept others, and attending to your own ideas and convictions.