Walk through Bogotá and it is hard to miss the bright orange delivery bags of Rappi moving quickly through the streets.
The on-demand platform has become one of Colombia’s most recognizable tech success stories, with a valuation above $5 billion and more than 35 million monthly active users. Its rise reflects a broader shift in Colombia’s economy, where improved stability following the 2016 Colombian Peace Accord has helped reshape the country’s global image.
Colombia Emerges As A Regional Startup Hub
Colombia is increasingly positioning itself as a key startup ecosystem in Latin America.
According to KPMG, the country had around 2,100 startups last year, marking a 24% increase year over year.
Maria Peñaranda of KPMG Colombia said the country ranks second in Latin America behind Brazil in terms of startup ecosystems, with nearly 80% of startups still in early stages.
Established companies like Rappi are helping drive momentum by recycling talent and attracting investor confidence.
Other growing companies include Yuno and Erco Energy, both of which have expanded internationally after reaching significant revenue milestones.
New Startups Expand Beyond Colombia
One example of a newer player is Foodology, which operates digital-first restaurant brands through dark kitchens.
Founded in Bogotá in 2019, Foodology has raised more than $60 million, employs over 800 people, and reports profitability.
“We have thousands of digital storefronts,” said co-founder Daniela Izquierdo, explaining how the company uses software to manage inventory and synchronize menus across hundreds of ordering platforms.
Like many Colombian startups, Foodology expanded early into other markets, including Mexico and Peru, reflecting a common strategy among founders to scale beyond Colombia’s relatively small domestic market.
Venture Capital Slowdown Creates Pressure
Despite the growth, many startups are facing challenges raising capital.
An earlier wave of investment, including funding from SoftBank’s Latin America innovation fund, helped boost the ecosystem around 2019 to 2022.
However, recent global market downturns have reduced venture capital activity, particularly in emerging markets.
Founders say funding has become harder to secure, with investors pulling back and prioritizing more stable regions.
Daniel Vásquez of Actions Capital noted that many companies struggle to reach their next funding round, even if their underlying business is strong.
Local Investment Seen As Key To Future Growth
Industry leaders say Colombia’s startup ecosystem needs stronger local investment to sustain growth.
Vásquez argued that limited domestic investment in research and development signals lower opportunity to global investors.
At the same time, some founders highlight the importance of local backing for operational success.
Habi, co-founded by Brynne McNulty Rojas and Sebastián Noguera, reached unicorn status after raising $200 million and has helped digitize property transactions in the region.
McNulty Rojas said more local investors would strengthen the ecosystem, even as international funding remains critical.
Outlook Remains Positive Despite Headwinds
While funding challenges persist, Colombia continues to attract entrepreneurs due to its growing talent pool and improving business environment.
Founders say the combination of skilled workers, expanding regional opportunities, and increasing global interest still makes the country a viable place to build companies.
The next phase of growth may depend on whether Colombia can convert early-stage momentum into sustained investment and long-term success stories.
Featured image credits: Airial
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