They can sustain heavy losses while waiting for a market to mature. Both are a good bet to come out winners, odds which are increased if they can pick off some of their rivals, like StarMedia, by acquiring them. Venture capitalists themselves have not given up on the Latin American market. But they will be targeting other segments and using different strategies, which avoid the ad revenue model. Some will invest in Internet infrastructure and enabling technologies, a good bet for first money in a market.
Circumstances also improve as the market matures.
New investments will improve the infrastructure. Entrepreneurs who have fled to other countries are returning home. Local universities are emphasizing technology in order to be able to fill the pipeline for tech workers and support the new growth in technology. In time, there will be success stories, although no one knows precisely when they will come. Even StarMedia itself could make a comeback, although it could well be as an acquired subsidiary of a stronger company.