Guadalajara: Mexico’s second city is a Latin ‘Silicon Valley’

Population: 1.5m (4.4m in greater Guadalajara)
Backing: $100m+ for 300 Jalisco start-ups in two years
Time to set up a company: One to two weeks

Mexico City is a megalopolis on speed. Monterrey, the northern industrial hub, is the money city, but with all the charm of a Houston suburb. But Mexico’s second city, Guadalajara, is a manageable size, with a growing hipster vibe, and combines tradition — as the birthplace of mariachis and tequila — with its niche as a Latin “Silicon Valley”.

The case for: With tech courses at some 20 universities, including a campus of the respected Tecnológico de Monterrey, there is no shortage of brains. Guadalajara has a record in tech and is home to big names such as IBM, Oracle, Intel and Solectron (which has since been bought by Flextronics), was an early tech arrival, attracted by its young, qualified workforce.

But what makes Guadalajara really stand out are its entrepreneur networks. Meetings hosted by groups such as iTuesdays and Hackers & Founders regularly bring innovative ideas into contact with potential investors.

Guadalajara is setting up a Creative Digital City, designed as a hub of digital media development and Jalisco is the first state in Mexico to have an innovation ministry.

The case against: Finding seed capital can be a struggle. Guadalajara is a conservative city where family ties are crucial and companies can be highly risk averse.

For some start-ups, the dream remains to make it big in the US, meaning Guadalajara may remain just a staging post.

Drug cartel violence is a rising threat: the Jalisco New Generation cartel recently downed an army helicopter and blockaded dozens of roads.

Local heroes: Sunu has developed an award winning sensor bracelet for the blind — billed as a “white cane for the 21st century” — called Ustraap. Inventive Power, a solar power venture, was a prize-winner in the 2014 Tech Awards in San Francisco.

VoxFeed, which targets digital advertising through social media “influencers”, has just raised $1.8m.

Show me the money: Investor networks and accelerators, such as Guadalajara Angel Investor Network and Reto Zapopan, are key to fostering homegrown talent.

Jesús Zepeda, iTuesday’s “director of awesomeness”, who is on his third start-up, hails cinema chain Cinépolis and tequila brand José Cuervo for offering acceleration programmes in Guadalajara.

The Jalisco Innovation Ministry predicts start-up investment — $100m in the past two years — will double in the next two.

The local view: Andy Kieffer, whose $2m seed capital fund Agave Lab Ventures invested in VoxFeed, says start-ups here are sitting on a gold mine. “There’s a staggering amount of money here. But . . . there are some big industries that have woefully underinvested in technology.” By using technology to solve “real world” logistical problems, entrepreneurs can look forward to sponsorship or grateful chief executives snapping up helpful start-ups for big bucks.

Getting there: Guadalajara is a four-hour flight from San Francisco, and one hour 10 minutes from Mexico City.