1. How would you describe the tech startup ecosystem in Paraguay from your perspective as a legal advisor?
The ecosystem remains quite in early stages but has presented a stable growth since around 2016, driven by increasing support from the private sector and certain government sectors.
This institutional interest largely responds to public demand. The public has shown enthusiasm for entrepreneurship as a driver of development and, to a lesser extent, for innovation in general.
The government has given a response that could be described as “broader and more comprehensive” toward entrepreneurship and SMEs compared to other areas in need of regulation, enacting laws such as Law No. 5669/2016 on “Promoting an Entrepreneurial Culture” (regulated by Executive Decree No. 9044) and even more social-oriented regulations, critical for a robust ecosystem, such as Law No. 5741/2016, which “Establishes a Special Benefit System under Social Security (IPS) for Micro-Entrepreneurs.” It has also created a legal and institutional network to support entrepreneurs, including reduced fees for the incorporation of Micro, Small, and Medium Enterprises (MSMEs), the introduction of a “PYMES Certificate,” platforms and online resources such as the “Entrepreneur Portal,” and much more. While you may not encounter the English term “startup” in these initiatives, they essentially aim to foster startups and facilitate access to critical tools for their development, such as training, advisory services, and funding opportunities.
However, from a more critical standpoint, while it is remarkable that laws have been enacted and institutional frameworks were established, including actual cabinet support through the Ministry of Industry and specialized agencies, many aspects still require improvement, leaving the ecosystem practically “in its teen years”.
For instance, as an attorney specializing in intellectual property, with experience in trademarks, particularly for SMEs as key drivers of industry, I can confidently assert that the government has not yet managed to provide startups with an impactful support for their legal incorporation, trademark registration, protection and growth.
Even with the launch of “DINAPI” as an autonomous Intellectual Property Office in 1998, Paraguayan entrepreneurs and startup owners often encounter a massive bureaucratic barrier. Rather than simplifying their experience or adhering to reasonable legal timelines, processes frequently last as long as 12 months or more.
Several factors contribute to this “barrier,” including the insufficient number of qualified personnel to handle the technical-legal review of trademark applications, the lack of proper technological implementation throughout the process, the variable education and experience of licensed attorneys, and the failure to conduct preliminary analyses of certain submissions, such as for example, oppositions to new trademarks, many of which are absolutely groundless and only worsen the process timings. These are just some of the elements that collectively result in a chaotic procedure.
Despite the abovementioned troubles of the system, these actually broaden the necessity of citizens for qualified legal counsel to navigate the process. This reliance increases the cost of entrepreneurship, adding a unique challenge to the innovation journey.
DINAPI is just one (but a clear) example of the obstacles startups face. Institutions like these tend to prioritize:
i) established businesses or those of any significantly perceivable value and
ii) foreign entities over local, emerging initiatives.
It is crucial to unify national policies for startups, not with temporary measures like “pro bono IP attorneys” but with enduring, integrated solutions that address all the needs of a startup to achieve consolidation.
These policies should encompass all institutions startups interact with, aiming at ensuring they reach at least an equal legal footing with other businesses. This includes compliance with documentation and tax regulations, registration of at least one entity and product trademark, corporate and accounting books required by our civil law, etc. Entrepreneurs should face disadvantages -if any- only in terms of experience and business scale, not in compliance or legal structure.
This is an urgent need that should become a state policy under a globalist and economically focused administration like Santiago Peña’s.
Some of the legislative efforts have received understandable backlash recently. For example, the bill to modify law 4457/12 (of the SMEs) just now approved by Congress, which increases from two, to three years, the time an SME can hire workers and dismiss them with no Notice of Terminantion or Exit payment, which is a special labor rule, only existent for SMEs, it is a violation of all the rights that we all have earned.
The government should recognize the potential of startups. A developing country doesn’t always need Microsoft to open an office or Toyota to establish a factory; nurturing dozens or hundreds of small companies can create a homegrown success story.
In Brazil, we can see Nubank’s remarkable journey, or globally, cases like Shopify or Airbnb. While Airbnb is perceived as a corporate giant, it was founded by three friends who found a necessity and created a response in an enabling ecosystem.
Partnerships between public and private entities and the interest of experienced, well-funded sectors have been vital in creating this new ecosystem.
Inter-institutional collaboration not only fosters favorable conditions for new ventures but also aims to establish a regulatory environment offering stability and legal security for entrepreneurs. This sustained support has enabled ecosystem players—entrepreneurs, investors, incubators, and accelerators—to find spaces where resources and knowledge are integrated.
Together, these efforts reflect the start of a vision by the government and allied institutions to build a dynamic, diversified economy where startups play a critical role in job creation, technological innovation, and competitiveness in national and international markets.
2- Would you say that there are sufficient formal support networks for tech startups in Paraguay? What are your impressions?
There is a modest and steadily growing formal support network (incubators, accelerators, universities, and similar initiatives.)
A longstanding leader has been KOGA impact lab, along with the historic TIGO conecta (now suspended) being both pilars of this sector’s inception. Newcomers: LAN accelerator and more recently Moonshot are taking stage.
As of March 2025, there is a mix of more than 35 venture capital firms, angel investors, accelerators investing locally, with a wide range of locals and foreign nationals involved.
I would say that the majority of the Paraguayan population has a somewhat European approach to entrepreneurship—not due to excessive regulation, but considering its wide preference for stable, formal jobs, even if they fairly hinder economic prospects.
As in many parts of the world, much remains to be done to democratize entrepreneurship as a way of life:
Innovation and entrepreneurship in Paraguay are very centralized. I would say the two major hubs are Asunción and perhaps the Ciudad del Este/Hernandarias area, with companies engaged in advanced activities such as Deriv, and Penguin. (Even if these were foreign initiatives, they are locally based and employ hundreds of paraguayans while reshaping these communities)
Innovation does also exist in many other parts of the country, such as Caaguazú (e.g., https://www.iec.org.py). Surely, there are other semi-urban and rural areas where technologies are applied, data is collected, and these are used for agricultural processes or research. However, this innovation is often "isolated" from the main centers of thought or commerce, requiring special incentives from key stakeholders.
As I stated in other words: Entrepreneurship is still seen as a privilege for affluent individuals. Until success is achieved, in many social groups in the country, entrepreneurs (especially those working in disruptive or unfamiliar fields) are not as valued as individuals with steady jobs.
Thus, what remains to be done is:
I) Strengthen existing innovation networks and work toward creating new ones in multiple cities, towns or villages across the country.
II) Build from within by integrating entrepreneurship as a concept and practice into traditional education, raising social awareness that entrepreneurship has driven many of the great nations and regions of the world to become the hubs of development they are today.
Regarding other forms of support networks for entrepreneurs:
Although (to the best of my knowledge) there are no technology parks in Paraguay that meet the strict definition of the term—such as Silicon Valley or Sophia Antipolis—we do have the PTI (Parque Tecnológico Itaipú, now rebranded as Itaipú Parquetec).
While it does not meet all the characteristics of the aforementioned parks, it serves as a hub for promoting and supporting innovation in the eastern part of the country by hosting educational institutions, providing coworking spaces, and offering strategic alliances for entrepreneurs.
Another recent plan in this regard, is the government’s announcement of a "Digital District" to be built on a 16-hectare site, with 10 hectares dedicated to the Taiwan-Paraguay University and 6 hectares to an industrial park.
Together, these would form the proposed district aimed at integrating the state, academia, and the private sector. This project, led by the Technology agency MITIC with support from the Inter-American Development Bank, could, when fulfilled, provide Paraguay—and specifically Asunción—with a common space that facilitates continuous synergy for startups.