The year began with severe economic concerns for investors. Despite this, venture capital seems to maintain its confidence in the potential of Latin America to develop ambitious startups worldwide, either with investment rounds for the most advanced companies or with acceleration programs for the most promising companies.
Brazil remains the paradise for Latin American startups and is among the favorites of investment funds, thanks to its large market and stable economy. 50% of the fund created by SoftBank has gone to startups in this country. Meanwhile, young technological promises continue to appear and grow through acceleration programs and financing rounds. These companies are directed mainly by young people who think from the beginning in business for the digital world.
BRAZIL AT SILICON VALLEY
In Brazil, for example, the organization Brazil at Silicon Valley and a Google initiative for startups are looking for Brazilian companies that can compete in the United States. Registration for this program was closed on February 1. For the selection process, 15 companies will be selected in an event organized by Brazilian students in California.
Brazil at Silicon Valley is an event created by Brazilian students from Stanford and Berkeley universities. The competition will be called “Startup Battle” and is open to startups that have not had more than one round of investment in the A-series. Each company will present their idea to a panel of experts that will evaluate their business model.
The jury of the contest will consist of members of Google for Business, startups from Brazil, and venture capital firms. Although the exact names have not yet been released, it is speculated that funds such as Valor Capital Group, which has invested in Loft, Gympass, Stone, and SoftBank, the main responsible for the increase in investment in Latin America, will be in the event. In Brazil, he has already invested in QuintoAndar, Creditas, and Loggi. Confirmed as speakers are Dara Khosrowshahi, president of Uber; Luciano Huck, Brazilian presenter; Luiza Trajano, president of Luiza magazine; Jorge Paulo Lemann, co-founder of 3G Capital; and Hugo Barra, vice president of virtual reality on Facebook.
The two startups with the best qualification in the contest will participate in the second half of the year in the Google acceleration program, Google for Startups Accelerator. The program has already helped more than 60 Brazilian startups, including Nubankk, Loggi, and QuintoAndar unicorns.
“We gave the winners of Startup Battle in Google for Startups Accelerator in Brazil because we believe we can help these startups to advance their solutions and the adoption of technologies in their products,” explains Andre Barrence, director of Google for Startups.
The event will take place at Google corporate headquarters in Mountain View, California. The startup selection committee reported that it is looking for companies that have great potential to generate social and economic impact in the Brazilian market. For this reason, they give preference to startups that work in topics such as health, finance, sales, agribusiness, and education.
“We believe that the moment is very opportune for solutions focused on generating social impact, especially with the growing demand of society for more inclusive and sustainable products,” the organizers write.
The event, which had its first edition in 2019, aims to connect Brazil with Silicon Valley to try to transform the country’s future with technology and innovation. This year, the conference will discuss three main themes: innovation ecosystems; Processing industries, and Social impact: viable ways to reduce inequality in Brazil through education, health, and entrepreneurship.
THE INNOVATION OF THE JUNGLE
Still in Brazil, but near the Amazon jungle, startup owners can participate in a business acceleration project called InovAtiva Brasil. This program will select 160 innovative companies for four months of free training. Registration will be available until March 16 from the internet.
All Brazilian startups may participate in the contest. Companies will be evaluated for their products or services with innovative solutions.
During the four months, participants will have training, tutoring, and events on the interaction with investors and potential clients. The lessons will be transmitted by executives of large companies and specialized in the subject.
“Most of the new companies are made up of young people because they are digital businesses. And there are two bases: the scale, this business needs to be disseminated, and scalable, a business that can be repeated within this digital environment, ”explained the director.
A school management startup, founded by entrepreneur Felipe Ferreira participated in InovAtiva three years ago, since then it has managed to expand the business to all Brazilian states, in addition to Portugal, Mozambique, Angola, Senegal, and Japan.
All this was achieved without any counterpart of the company, which he cites as one of the benefits of the program.
“We are very concerned with the percentage that has to be given to an accelerator every time it goes through an acceleration process. InovAtiva, because it is a federal government-sponsored program, gives you the entire acceleration program without charging any company participation. It is a unique advantage, ”said the businessman.
This initiative of the Ministry of Economy and Sebrae exists since 2013, intending to promote the acceleration and development of Brazilian startups.
BABIES ARE A NEWBORN MARKET IN BRAZIL
The so-called “Baby Startups” arrived in the South American country. These companies offer solutions related to health monitoring and product delivery for babies.
Of course, babies are a market that never stops growing. Every day, about 392,000 babies are born in the world, according to UNICEF data. This peculiar segment requires special attention from before birth. Some Brazilian startups have already begun to develop solutions that facilitate the daily lives of mothers.
In Brazil, the sector has not yet matured. However, in other countries, they begin to show their viability. As an example, there is the case of the American company Yumi, which delivers baby food by subscription and has already raised $ 12.1 million in contributions. Technological product initiatives have also emerged: Pampers, for example, launched a smart diaper at the end of last year. Equipped with a sensor, the diaper warns parents when it is wet.
The startup Avocado, from São Paulo, developed an application for delivering products widely used by babies, such as diapers, wet wipes, moisturizers, and shampoo. In total, the company’s portfolio has about 400 items, which can be ordered through the application and delivered in two hours. “We want to prevent people from wasting time going to the supermarket or pharmacy,” says founder Mariam Topeshashvili, a graduate in Political Science and Economics from Harvard University.
Created in 2018, Avocado has already received two rounds of contributions totaling the US $ 1.7 million. To offer the service to its 8,000 users, the startup purchases the products of the industry and stores them in a warehouse in the Pinheiros region of São Paulo. Today, Mariam’s company makes deliveries only in the capital of São Paulo, with Loggi logistical help. By 2020, the company plans to open ten more distribution stores in the city and have more products available in the application, to serve the whole family.
Another company that has begun to try its luck in the newborn market is Liv Up, which makes healthy lunches on request. The company already received an investment close to 20 million dollars in September 2019, and now it tests with its service.
Perhaps because of the global situation, the growth in venture capital will not be as significant as it has been in previous years in Brazil. Still, at least the entrepreneurs of this country will have the opportunity to continue growing at a fast pace.