Contxto – Brazil’s ecosystem is growing—and that’s not necessarily within its borders. Brazilian entrepreneurs and venture capital (VC) firms in Silicon Valley are looking to play an important role in strengthening the startup scene.
Non-profit BayBrazil has been tracking this quite carefully.
This organization recently arranged a survey that found that 11 startups with Brazilian founders operating in Silicon Valley have raised funding for at least US$2 million. The majority of these funds were closed in the last two years.
Likewise, there are VC funds who’ve grown a dual presence both in Brazil and in Mountain View. All of which shows that there’s no such thing as boundaries when it comes to the Brazilian ecosystem.
However, compare those US$2 million to the total amount of capital these 11 startups have raised; a combined US$849 million, according to BayBrazil.
Thus, if these companies got magnitudes more funding elsewhere (US$850 million) than they did in Silicon Valley (just US$2 million), the questions come to mind:
- Are the bragging rights to being set up/funded by Silicon Valley worth the investment of the move? Who knows! Maybe the other investments stemmed from this coveted Bay Area-status.
- However, I am driven to wonder, to what extent is moving/being funded by Silicon Valley a purely performative activity?
Brazilian startups in Silicon Valley
Brex and its financial products for small and medium-sized enterprises (SMEs) is the leading startup from the Bay in funds raised. It closed US$150 million last May to reach a reported US$2.6 billion valuation. One of its major selling points has been its credit card for startups.
These developments have largely inspired entrepreneurs in Brazil, like Stark Bank, that want to launch their own line of fintech products, largely targeting their own fellow startups.
Olivia is another Silicon Valley-based fintech who closed funding this year for its AI-geared personal financial app. But just because it’s in California, doesn’t mean the startup forgets about its co-Founders’ home country.
“Olivia plays talent arbitrage by recruiting top AI/ML engineers in Silicon Valley to seize the massive opportunity of transforming, through data, the financial industry in Brazil,” says Olivia co-Founder and CEO Cristiano Oliveira.
Spreading seeds (and investments)
Brazil has multiple VC funds within the country to support its startups. But boosting Brazilian companies is not always a matter of being in Brazil.
For example, ONEVC is US-based. However, it is an active investor in Brazilian startups. Among its portfolio companies are legaltech Docket, enterprise startup Pipefy, proptech Yuca, cybersecurity idwall—to name a few.
Meanwhile, some Brazilian VCs, like Indicator Capital, have also opened offices in Mountain View. In Indicator’s case, it did so in 2018 with the goal of acting as a link between Silicon Valley tech and practices with Brazilian markets.
Indeed, whether it’s startups or VCs, building these types of bridges between the Bay Area and Brazil is giving its overall ecosystem an advantage both in terms of insights and networking.
Related articles: Tech and startups from Brazil!