Necessary conditions for venture capital development in Latin America: the Chilean case

The factors conditioning venture capital development in any country are the economic context and dynamism of the companies that make up the industrial park, the fiscal and regulation context, a stock market especially for Small and Medium Enterprises (SMEs) and an entrepreneur mentality regarding enterprise capital openings. In this context, the aim of this paper is to analyse the Chilean case so as to verify the presence of the above mentioned factors in that country. The methodology involves a detailed bibliographic revision and questionnaires given to "formal" Chilean venture capital institutions. The results show that the conditions for venture capital development are present and the measures for capital market reform have already been taken. However, aspects such as differentiated fiscal treatment and entrepreneurs' open mindedness for new partners still need to be consolidated.