Some 50 percent of Endeavor’s entrepreneurs are “local stars” who have developed a regional brand but find themselves at an inflection point where they need support to expand their brand nationally or regionally. “It’s actually not the startup that’s the trouble — people find crazy ways to launch new ideas,” says Rottenberg. “It’s at the point where they hit $1 million or $5 million in sales. That’s where they need to professionalize their management, fire their mother-in-law, or think beyond their borders and recalibrate their public franchising strategies.”
The rest of the organization’s entrepreneurs, she says, are “diamonds in the rough” — young, talented individuals whose ideas might never get off the ground without external support. Wenceslao Casares, a 24-year-old Argentine entrepreneur selected in 1999, is an example. The son of a Patagonian sheep rancher, Casares founded Patagon.com, Argentina’s first online trading portal. Like many other young entrepreneurs in Latin America, he had made attempts to procure capital but was unsuccessful. Endeavor’s mentors provided him with strategic guidance and helped him negotiate a $4 million funding agreement with U.S. venture capital firm Flatiron Partners. Less than two years later, in a move that earned him almost mythic status among his peers, Casares sold a majority stake of Patagon to Banco Santander for $750 million.
Endeavor’s entrepreneurs have shown that they can overcome other obstacles. In 1999, the Argentine economy crashed. Investor confidence plummeted; unemployment soared to 25 percent; Argentines began withdrawing large sums of money from banks, exchanging pesos for dollars. Protesters took to the streets of Buenos Aires, and a state of emergency was declared. Yet in the midst of this chaos, Endeavor Argentina’s entrepreneurs achieved substantial growth in revenues and employment.
“It’s always at a time of crisis that the best entrepreneurial ideas crop up,” Rottenberg says, citing Argentina’s experience as a perfect example of how a culture of entrepreneurship can take root in challenging conditions. “Entrepreneurs can capture a larger market share, hire better talent, and tackle problems more swiftly than large firms.” A decade after the crash, the New York Times opined that Endeavor had been “a catalyst” for Argentina’s “evolving start-up culture…which is now entirely locally run.”
Similarly, Alan Farcas, Endeavor Chile’s managing director, believes that since its successful relaunch in 2002, the organization has changed his country’s business culture. “Ten years ago, nobody in Chile spoke about entrepreneurship. It may sound strange, but in emerging markets, people don’t connect entrepreneurship with job creation and with making their country a better place to live, the way they do in the United States. Ten years ago, businesspeople were viewed as little more than thieves. We’ve helped change that perception — people now view entrepreneurship as a force of good, for both the economy and the country at large.” What’s more, Farcas says, high-impact entrepreneurship is now part of the lexicon.
According to Endeavor’s metrics, 75 percent of new ventures in developing and emerging economies have two employees; Endeavor’s entrepreneurs, on the other hand, employ an average of 263. In addition, 95 percent of Endeavor’s companies provide more benefits than those required by law, and 69 percent of Endeavor’s entrepreneurs have created companies that are the first in their industry in the entrepreneur’s country.
Rottenberg believes that the secret to Endeavor’s success is its built-in ripple effect. “We have told the entrepreneurs all along that they have to pay it forward,” she says. “We make it clear that now that they’re successful, they have to make sure that the environment is conducive to the next generation starting and scaling businesses. Our entrepreneurs understand that the top people in their country and on our global board did not put in money to make another few guys rich.” In addition, Endeavor has focused on creating partnerships with governments, universities, the media, and multilateral institutions. Since 1998, more than 13,000 people have attended Endeavor Argentina’s annual entrepreneurship conference. Endeavor Brazil — launched in 2000 — hosts weekly online seminars; they drew more than 1.5 million viewers in 2010 alone.