Domain Names of the World

There is a market of 500 million people--about 8.6% of the world's population--that the business media all too often neglects as it serves up story after story about China and India. That would be Latin America.

Between 2000 and 2007, the number of Internet users in Latin America grew from 18.1 million to 122.4 million, a compounded annual growth rate of 32% compared with only 12% in North America during the same period. Chile has the highest penetration of 43.2%, with Argentina at 39.7%, Brazil at 22.4%. Average penetration across Latin America is approximately 21.5%, as compared with 71.4% for the U.S. Overall, Latin America's Internet population represents close to 10% of the world's Internet users.

Not surprisingly, Latin America is developing its own collection of Internet stars. One that has really caught my eye is MercadoLibre, an online marketplace that facilitates buying and selling of computers, electronics, photography equipment, household items, even cars. It was started in 1999 in Buenos Aires, Argentina, by Stanford Business School graduate, Marcos Galperin. Full disclosure: MercadoLibre invited me to visit the company last autumn and advise them on strategy. What I learned impressed me.

Although MercadoLibre had a rocky start, the company has started delivering stellar results, growing at over 60% and profitability is increasing steadily. The moral of this story: It takes patience to build a great company, even in Internet time. Now, I believe MercadoLibre has an opportunity to become a billion dollar enterprise in the next 10 years and be a force in Latin America's economy.

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