Brazil has been generating a significant amount of buzz in the venture capital and startup community recently, fueled in part by media coverage of several high profile firms “planting their flags” in the country with dedicated funds or investments. A growing awareness of the burgeoning Brazilian startup scene, and Brazil’s role as host in the upcoming World Cup and Olympics, has further elevated the country’s profile.
Is this hype justified? When discussing Brazil, comparisons to the evolution of China’s VC industry are commonplace. But what do the VCs investing in Brazilian startups really think? And how might Brazil’s VC ecosystem evolve over the next five to 10 years?
Our MBA team from the MIT Sloan School of Management recently concluded an in-depth study* of these topics sponsored by Sloan’s Global Entrepreneurship Lab program and Ideiasnet, a leading Brazilian venture capital firm. We conducted extensive research via industry publications, online sources, and academic papers, interviewed over 20 VCs and ecosystem participants, and spent one month on-site exploring Brazil’s VC ecosystem first-hand. Here is what we learned: