Voting machine maker bought (Smartmatic bought Sequoia)

Young Venezuelans seeking capital for high-tech start-ups can usually find supporters. But when those Venezuelans are supplying the voting machines for a hotly-contested national referendum--President Hugo Chavez faces a recall attempt this month--that means controversy. The devices will be provided by Smartmatic, a tiny Florida company headed by a pair of 30-year-old Venezuelans which have never before supplied an election. The software is to come from Bizta, also owned by the young techies. In January, a Venezuelan government official joined Bizta's board. A month later, Venezuela's elections office chose Bizta, Smartmatic and national phone company CANTV to provide voting machines, a US$58 million contract. Then, in June, The Miami Herald reported that a government-owned venture fund had invested $200,000 in Bizta.

Based in Caracas and Boca Raton, Florida, Smartmatic’s Venezuelan founders, Antonio Mugica and Alfredo Anzola, saw opportunity in the wake of the 2000 election fiasco in Florida—and quickly developed an electronic voting system to take advantage of renewed worries about manual voting’s susceptibility to fraud. But while Mugica developed a sales strategy for the U.S. and Latin America, it would be his homeland that would deliver the fledgling company’s first plum contract—and a contentious blow to its integrity and credibility.
The Smartmatic-led SBC consortium, which won the Venezuelan

government’s $91 million contract, included software developer Bizta, partly owned by Mugica and Anzola, and Cantv, the country’s privatized telephone company. The opposition attacked the government-controlled National Electoral Council (CNE)’s choice from the start, complaining of Smartmatic’s inexperience—their new system had never been used in an election.

In addition, news of a pre-referendum loan to Bizta from the Venezuelan government only served to fan suspicion in a country where the president’s vitriolic left-wing rhetoric and open admiration of Cuba’s Fidel Castro have deepened social divides, and whose incursions into every branch of government worry critics who see a power-hungry autocrat.