by Valentina Cano
Every year, thousands of businesses are created in Venezuela; yet, according to the Global Entrepreneurship Monitor, most of them won’t survive. Why? One of Venezuela’s leading academics, Aramis Rodriguez, Coordinator of the Entrepreneurship Center of the Institute of Higher Education for Business Administration (IESA), notes that Venezuelans have a start-up mentality, mentioning that “18% to 20% of Venezuelans over the age of 18 are starting a business. The typical Venezuelan is driven to innovate, according to Rodriguez, but the firms’ young entrepreneurs have two problems. First, they are micro-businesses with 1-2 employees, and second, they are in low growth sectors with little room for innovation.
Rodríguez expressed that although this might sound pessimistic, entrepreneurs always adapt to their environment. With an economic structure built on an import-retail business model, little time has been spent on developing a dynamic export or innovation economy outside of oil.
From a macro-economic standpoint, Rodríguez suggested that the real problem is a lack of coordinated and sponsored business and entrepreneurship training and education. Rodríguez’s research found that “Venezuelans view entrepreneurship as a desirable career path, which can be very different from other countries.” To push beyond small business creation, Rodríguez tells all entrepreneurs to search for the right education and mentorship and to thoroughly test their business model.
Expanding on the educational problem, Gonzalo Cabrera, director of the “Entrepreneurship Zone,” stated that the first thing an entrepreneur must do is to stay focused and not dwell on the negative situations—political and economic—around them. This piece of advice is crucial for Venezuelans, given their country’s less than ideal environment. “You can’t [overthink] because fear can paralyze you…Creativity is very important. You must be bold, and daring.”
Another senior business leader, Simón Milá de Roca, Consultant of Business and Franchises, explained that in Venezuela the business environment and economic situation is challenging and complicated—with onerous regulations, limited and rationed resources, and hyperinflation. These barriers, however, are viewed as opportunities for younger Venezuelan entrepreneurs. But unfortunately, the entrepreneurial mindset oftens encounters a standing belief of “In our country, there is a ‘cemetery’ of ideas [by] young people that are not correctly focused because of lack of knowledge.”
Is there a reason to be hopeful?
Yes. The Metropolitan University (UNIMET) is a beacon for entrepreneurial knowledge in the nation’s capital, Caracas. Ranked as one of Venezuela’s top universities, UNIMET differentiates itself by focusing on entrepreneurship. Read more: NOVOS Center, The Center for Entrepreneurial Initiatives, and the Entrepreneur Zone.
Interview with the founders of Tablas Waikiki: Gabriela and Karina Vernet
First of all, what are Tablas Waikiki and how are they made? They are balance boards, a device used for recreation, athletic training, therapy, and more! Tablas Waikiki are laser cut and engraved wood boards covered on top with laminated self-adhesive vinyl which provides greater protection and quality. They also come with a 4-inch roller with anti-slip rubber.
What are the benefits of using these boards? They improve balance, coordination, posture, concentration, and self-esteem; help strengthen the core and ankles; boost motivation to learn; contribute to emotional self-control; counteract the effects of stress, and develop a sense of rhythm.
How many people are part of your business? It started out being only us two, but now we have a team of 7 people.
How did you decide on the name and image? We wanted our image to transmit the idea of the origins of balance boards: surfing. We decided on the name because there’s a beach in Hawaii called Waikiki, and the color blue to represent the water and waves.
Who were your first clients? Who are your customers? Friends and acquaintances. Now, our main customers are children and people from the fitness world.
How does your marketing work? Through Instagram: Our account @tablaswaikiki is our only, but very powerful source of marketing. We publish everything from our manufacturing process to the different designs that we make.
Have you thought about making a website or a Facebook page or is Instagram your only way of digital marketing? What would you do if Instagram lost popularity? Do you use it to post prices as well? Currently in Venezuela, within our target social group, Instagram is very popular, so we haven’t had the need to change our social media. Yet, we are definitely willing to adapt to new platforms. A website is actually in our plans for this year! We do not post prices though; our prices are sent via phone or private messages.
Where and how do you sell the boards? What is the best time of the year for your sales? The whole process is through Instagram and cellphone. We deliver the boards in our workshop. December is the best time of the year for sales because we participate in several Christmas bazaars, where boards are the perfect Christmas gift for anyone! We make a stand, put a test board for people to try out and to grab their attention.
Where do you buy the materials to make the boards? Do you need to buy imported materials? We buy our materials in several places, and we buy [Venezuelan] products. Although they are sometimes very hard to find…we have been able to survive the [economic and political] crisis.
Venezuela has one of the highest rates of inflation in the world, which is expected to hit 1640% in 2017. How does this affect you? Because of inflation, it is [challenging] to maintain stable prices. From one month to another our costs can double. Although we try to not increase the price too much by lowering our profit, we still have to continually change our retail price to keep the business profitable.
Given that there is exchange control, Venezuela has a black market exchange rate for foreign currency which is constantly changing. How does the unstable dollar rate affect you? We have thought of “dollarizing” our product, by setting a stable price in dollars, where we would set the price depending on the exchange rate of that day. Currently, we accept either Bolivars or dollars as a payment method, but since we haven’t yet “dollarized” the boards, we don’t always have the same price-profit relation.
Do you have any competition? Yes. Three other brands sell balance boards here in Venezuela, but ours stand out because of our designs and the option to personalize them.
How much longer do you think you will be in charge of this business? Right now, we’re in charge of Tablas Waikiki while studying in college, but we’re definitely willing to maintain the company after we graduate, and try to grow as much as possible.
What ideas do you have to grow? We’re in communication with several stores right now to distribute the boards to different parts of the country. This year we’re also thinking of investing in non-digital publicity and, if possible, start exporting our product.
How do you manage to be a student in college while you manage this business? With proper time management, anything is possible. Of course, it isn’t always easy, and we’ve had to establish some priorities, but we have been able to manage by delegating tasks and dividing our responsibilities.
What advice would you give to other students who also want to start a business while in college? Learn to manage your time. You have to focus on what it is you want to accomplish and take advantage of opportunities at the right time. Personally, our business has helped us grow and learn a lot—and it has helped us take our college education more seriously.
Do you feel that your Entrepreneurship classes at your University and your Business degree has helped you be successful in your business? We think that drive and motivation is everything, and in the UNIMET they are constantly motivating you to get out there and try to start a business. In the core curriculum of our University, they focused a lot on entrepreneurship, which gave us the tools and basis of how to establish our company. What we learn every day we always put into practice in our business. This experience has also helped us a lot to identify our interests within our career.
Educating oneself regarding Entrepreneurship and Business administration is truly important for anyone who wants to start a company. Getting to know an outstanding business such as Tablas Waikiki can undoubtedly prove that challenging environments such as the one we encounter in Venezuela do not necessarily act as an impediment to innovation and success. Conversely, it sometimes works as an accelerating factor that helps us identify good opportunities and define strategies that help create and develop a business most productively and profitably.
So, we can say that, with the right preparation, organization, and mindset, entrepreneurship can be an optimum path for college students trying to innovate in this country.