Buenos Aires — Wearing a suit with a Bitcoin-covered tie, Tim Draper speaks confidently about Argentina’s future. The renowned VC investor sees President Javier Milei’s government as a “window” for the country to reclaim its long-lost place among the world’s leading economies, while also warning about the “socialist tendencies” he perceives in the International Monetary Fund (IMF).
In an interview with Bloomberg Línea, Draper shared his vision for Argentina’s potential under Milei’s libertarian experiment, whiile he harshly criticized the IMF’s historic role in the country. The conversation took place at Usina del Arte in Buenos Aires during the Draper Cygnus Tech Week, an event organized by his VC fund that focuses on seed investments for Latin American startups.
Draper is best known for his early investments in companies that revolutionized their industries, including Tesla, Skype, SpaceX, Hotmail, and Baidu. In 2014, he purchased 30,000 bitcoins in a U.S. government auction for approximately US$19 million, an investment that today would be worth more than $2.6 billion.
With an estimated net worth of US$1.2 billion, his strategy has always focused on betting on disruptive ideas and founders willing to challenge the status quo, targeting early-stage Latin American companies through Draper Cygnus.
Draper was emphatic about what Argentina needs to attract foreign investment: “Yes, I believe all of that has to go,” he stated when asked about Argentina’s current tax burden and imminent elimination of capital controls, which still prevent companies from freely distributing dividends abroad.
Milei’s LIBRA crypto controversy
The VC investor also defended Milei following the LIBRA memecoin scandal. The token, which Milei himself promoted as a legitimate project for financing small businesses, later faced fraud allegations after an apparent rug pull.
“I don’t think it’s a scandal. In fact, I really admire a leader who’s willing to try new technologies and took a swing. This one didn’t work. But memecoins are new. There’s a future there,” he said, describing Milei as “an innovator” for taking risks with new technologies.
He defended the Argentine president despite not managing to meet with him during his stay in Buenos Aires. “I would have liked to meet with him,” Draper said, adding: “he had a very busy week. He had to cancel for some reason.”
Bitcoin vs. dollar: “Argentines would choose Bitcoin”
Regarding the country’s monetary future, Draper, a known cryptocurrency advocate, expressed disagreement with Milei’s statements—in a 2022 interview with Bloomberg Línea—that Argentines have chosen the dollar over Bitcoin.
“They haven’t chosen Bitcoin? That’s baloney,” he said. “I’m pretty sure I’m right in saying that people would choose Bitcoin,” he affirmed, suggesting conducting surveys among young people and adults to prove it.
According to his hypothesis, “generally someone under 35 will say Bitcoin nine times out of 10, and someone over 35 will say dollars, maybe it’s 60-40 in favor of Bitcoin.”
The IMF as “a dark shadow” over Argentina
The founder of Draper Associates was blunt when addressing the relationship between Argentina and the IMF.
“Now you have the IMF and they’re a serious problem because they have a socialist tendency. They say they’ll give you this money but you have to do this, this, this, and this. Well, that’s not healthy for any economy,” he pointed out forcefully.
According to Draper, the international organization imposes conditions that limit countries’ economic freedom. “If they just lent the money without so many hooks, all power to them. But they always gave loans with these hooks,” he explained, adding that “that has been a great dark shadow over Argentina for a long time.”
“Argentina can be the number one country in the world again”
The investor, who manages a fund of approximately $200 million with investments ranging between $1-10 million per round, is optimistic about Argentina’s future under Milei’s administration, although he acknowledged that the road to economic recovery will be long.
“I think you have a window, you have Milei in power, and Argentina can be the number one country in the world again,” argued Draper, recalling that 150 years ago Argentina was one of the most prosperous economies on the planet.
“If you have a president who embraces the free market, if you have a capitalist president, you have a window to build your economy and lift people out of poverty,” affirmed Draper, who sees in Milei the opportunity for Argentina to rise economically.
However, he warned that the transformation won’t be immediate: “It will take a couple of generations of real capitalism to bring Argentina back to the top,” he explained, referring to the decades of political oscillations between left and right that have marked the country’s economic history.
Trump’s import tariff strategy
On the other hand, Draper found positive aspects in Donald Trump’s controversial tariff policy. “I think Donald Trump is saying, ‘look, if you have a tariff, I’ll also put a tariff on you.’”
“I think it’s a great strategy, because most countries will look at that and say, ‘well, we’ll lower ours to 20%, and then you’ll lower to 20%, and then we’ll lower ours to 10%, and then you’ll go down to 10%, we’ll drop completely and then we’ll be in a free trade zone,” he explained.
Despite admitting that he “hates the idea of imposing tariffs,” he believes this strategy “might actually be a great way to encourage the free exchange of goods around the world.”
To illustrate how sometimes seemingly counterproductive strategies can yield unexpected results, Draper recounted an anecdote with Netflix’s co-founder: “Sometimes it’s hard to understand people who are smarter than you. Reed Hastings came to me with this idea that he was going to take movies and put them on DVDs and ship them to American homes. And I said, Reed, you’re a brilliant guy, but we’re going to be able to stream these things in two years. And he said, ‘they’re not ready for that yet.’ And I didn’t get it, but he did and he was right.”
“And so sometimes people who are leading countries understand some things that the rest of us don’t understand. And, you know, we get it wrong, the press gets it wrong, and suddenly something good happens and then everyone says, ‘oh yeah, that was a good idea.’”
Technology hub in Argentina: “The best way is to shrink the state”
Regarding the Milei government’s ambitions to turn Argentina into a global technology hub, Draper was skeptical about state intervention in this objective.
“It’s not about Argentina. It’s about individuals saying, let’s build a tech hub here,” he explained, emphasizing that the government’s role should be limited to creating the conditions for innovation.
“The best way to be a technology hub is to say, we’re shrinking the state, we’re offering freedom, we trust people, and go ahead, innovate, try things. You won’t be punished for trying something and failing,” he pointed out.
The VC investor mentioned that he tried to meet with Milei during his visit to Argentina, but the meeting was canceled due to the president’s tight schedule. However, he recalled his amusing bet with former president Mauricio Macri about which would perform better: Bitcoin or the Argentine peso.
Argentine startups on Draper’s radar
Draper, who has invested in several Argentine startups such as Ripio, Stämm, and a space communications business alongside Draper Cygnus, was enthusiastic about local entrepreneurial talent and assured that his investments in the country will increase.
“We’ve been able to come and co-invest with Draper Cygnus in a number of good Argentine companies. I think that number is going to go up because with Milei, Argentines are going to have more freedom, more creativity,” he assured.
Unlike other venture capital funds, Draper emphasized that he doesn’t demand immediate profitability from the startups he invests in. “I’ve never required profitability from my companies. I would like them to be profitable someday, but really, I like to be the first test,” he explained.
The investor highlighted three Argentine companies that he’s particularly excited about: Stämm, a developer of bioreactors; Ayuvant, which he’s evaluating and could be “a life extender”; and Ripio, the cryptocurrency platform founded by Sebastián Serrano, whom he described as “an extraordinary man.”
Regarding Ripio, Draper commented that the company could be close to achieving unicorn status, which would be “a good success model for all Argentine entrepreneurs.” He compared this potential impact to what happened in China after Baidu’s IPO, where he was the first Silicon Valley investor, and in Estonia after the founding of Skype.
