Back in 1999, two students at the IESE Business School of the University of Navarra in Barcelona came up with the idea of establishing a global network of medical experts that would provide second opinions to insurance companies and their patients. Four years later, their company, Centro Médico Virtual, employs 40 people, boasts a case history of more than 3,000 patients in Europe and the U.S., and expects its first annual profit on revenues of some $3.5 million. "The economy was beginning to boom, and that made potential backers eager to look at the idea. There's a new willingness to take risks in Spain, and we have taken advantage of that," says Carlos Nueno, who together with fellow MBA Marc Subirats and Pedro Torrabadella, a physician, founded the company.
That pioneering spirit has made Spain one of the fastest-growing countries in Europe and a leader in business startups. Economic reforms -- coupled with low interest rates, and lower taxes -- have created a market in which entrepreneurs by the thousands are willing to risk embarking on new ventures, from tourist inns to tech startups. Since 1997, more than 727,000 new businesses have been created, helping halve Spain's unemployment rate to 11%. Though some of these enterprises were forced to close their doors during the global downturn, the fallout has barely put a dent on Spain's growth, expected to reach at least 2.3% this year.
The government deserves a lot of credit for the new-business boom. After taking office in 1996, José María Aznar's administration slashed government spending, increased the flexibility of Spain's labor market, and introduced tax breaks for small and medium-size businesses. "Reforms and the strong economy have created a much more business-friendly climate," says Enrique de la Lama-Noriega, director of the economics department at CEOE, the Spanish Confederation of Business Organizations.
That climate made Centro Médico Virtual's rapid growth possible. After drawing up a business plan in early 1999, Nueno and his partners shopped it around to Spanish investors. By the end of the year, they had raised $1.17 million. "Building up the network [of medical experts] has been the challenge," says Nueno, 30, now managing director. "But setting up the business and getting the financing was easier than I had imagined." For Spain's growing entrepreneurial class, it's a brave new world.
By Paulo Prada in Madrid