9 ms·

Brazil: A look into Latin America’s largest startup ecosystem (2017)

72 points by ishikawa 8y ago

rs86 8y ago
It's a myth that Brazilians are more creative. Doing business in Brazil is incredibly difficult - lack of talent, ethics and terrible financial sector.
- anderber 8y ago
  This seems to be a very myopic view of a large and diverse country. I've seen both extremes when it comes to talent and ethics.
  - jorblumesea 8y ago
    Have you been to Brazil? Brazilians take the entire day off to go to the bank because it takes that long and processes are so inefficient. I was shocked at how non functional the society is as a whole. Their national museum just burned down because the country couldn't even allocate funding properly. You expect running a business there is going to be a simple and transparent affair? This is not a knock on the people themselves. They're smart, caring and competent, but to be honest, the country is a mess.
    - adnzzzzZ 8y ago
      As a Brazilian I'm not going to deny that the country is full of problems, but the person you replied to said that the country is big and that both extremes exist. No need to focus only on the negatives when the country has many things going for it.
      - jorblumesea 8y ago
        Completely agree, pretty inflammatory and vaguely racist comment. I think we can also agree things are far more negative than positive nowadays. Temer is really just the another nail in the coffin for functional Brazilian society. Things are looking much more bleak compared to a decade ago.
        adnzzzzZ 8y ago
        I actually disagree and I'm highly optimistic for the future of my country. But I'm aware that I'm a minority when it comes to this opinion.
        jorblumesea 8y ago
        That's fair, keep the positivity alive! :) But most Brazilians I've talked paint the picture as a dire situation, unfortunately. Best of luck.
    - tambourine_man 8y ago
      >Brazilians take the entire day off to go to the bank That is completely false. I can’t imagine where you got this from. Brazilian baking is years ahead of the US, not that it represents a high bar.
      - diego_moita 8y ago
        > I can’t imagine where you got this from. Perhaps from daily life? There are long lines on most bank branches I go to, unless you're wealthy enough for the manager to pamper you. Red tape in this country is so bad that there is a whole industry to avoid it ("despachantes"). BTW, the trick this industry uses to avoid banking lines is to hire old retired people to buck the line for them (there's a law here giving to old people that privilege). They basically screw everyone else by buying privileges. Some call it the "Brazilian touch" (jeitinho brasileiro), I call it corrupted morals. > Brazilian baking is years ahead of the US Really? To do online banking in your computer with Banco do Brasil you need to ask permission to your branch manager and install a specific virus on your computer. I believe the same goes for Bradesco and Itaú. Many ATMs and branches in small towns are being closed and leaving those places without financial services because mobs moved from big cities to rob those places without good police. And, guess what, people there can't do online banking.
        tambourine_man 8y ago
        Red tape is bad, but obiquious cellphones helps a lot. The US still uses checks and signed credit card receipts. Compared to that Brazil’s banking system is state of the art. >To do online banking in your computer with Banco do Brasil you need to ask permission to your branch manager and install a virus on your computer Yes, but most people use the phone app, which is ok. Banking on a computer is bad everywhere.
        afarrell 8y ago
        > and signed credit card receipts chip & pin rolled out a year and a half or so ago, including to a small general store in rural central Maine.
  - diego_moita 8y ago
    > I've seen both extremes when it comes to talent and ethics. Extremes exist in every country but a bad average exists just in some. Brazilian average is bad.
- lucashn 8y ago
  Lack of competitive pay makes talent leave the country (source: I have many friends working in startups in USA due to better working conditions).
  - rbanffy 8y ago
    Source, yours truly. But what drove me away was not the money - I make a lot more money now, but in a much more expensive place. Retirement projections remain firmly planted on the very same date since I left and aren't going to change much either way unless some major upheaval happens. What really drove me out was my lack of faith. Corruption was rampant (it was always like this, since well before I was born) but it was being investigated, in some cases more seriously than others, but the local equivalents to the DoJ and the FBI (I'm doing this for the Americans in the audience, hope it helps), for the first time since essentially ever, able to work free from executive interference and, unsurprisingly, uncovered a lot of misdeeds. With that, the perceived corruption skyrocketed, government popularity sunk, trust in the government went into a death spiral and the legislative and judiciary decided it'd be convenient to stage a coup (sorry, "impeachment" is not the right word) so that someone more malleable would be in power (there was even a phone recording stating that much). At that moment I was over for me. I grew up in post-64 coup Brazil and don't want my daughter to go through the same.
  - malandrew 8y ago
    Couldn't agree more. Of all the engineers I worked with back in Brazil that I would happily work with again, more than 75% of them left Brazil. They now live in places like the San Francisco, Palo Alto, NYC, Toronto, Montreal, Berlin, Amsterdam, London. What's most ridiculous is that at the recent BayBrazil event here in São Paulo, I explicitly asked the panelists if the situation had changed since when I worked there a manager would make 2.5x to 3x what the ICs earned. Every single panelist dodged the question by spouting some bullshit about how people have other motivations besides money for staying in Brazil. Yeah, I'm sure a minority of them do, the majority however keep leaving.
- dataker 8y ago
  I'm Brazilian and you are completely correct.
- epx 8y ago
  I am Brazilian and it's been a year since I went into a bank to do anything. All expat friends say that Brazilian bank system is the best. This has a specific reason: inflation in 1980s imposed fast banking service.
  - gdsimoes 8y ago
    I am a Brazilian currently living in Canada and I was very surprised when I discovered that Brazil’s banks are actually much better than Canada’s.
    - deleted 8y ago
      [deleted]
theparanoid 8y ago
Brazil has and continues to perform poorly on measures of cognitive competence. It makes Mexico look like academic achievers.
- 81bdf7bb 8y ago
  Well, Mexico did produce that one guy that created GNOME. So maybe he just got lucky?
rodolphoarruda 8y ago
Maybe the country has the largest ecosystem because there are a lot of people in there. That doesn't imply in high quality, positive ROIs etc. Lots of people are just trying.
- rbanffy 8y ago
  The country has some decent universities, some large and rich cities (despite the country, being, on average, poor) and some entrepreneurial attitude. The drawback I observed the most is the same @cscotti pointed out: the people who end up creating companies are not particularly well suited for that. They want quick money out of outrageous profit margins - they are often already rich, but think they are entitled to more. It's the Brazilian version of the robber baron standard, but in a fractal pattern almost down to the bottom. And, now, there's also the crazy politics (thanks, Obama) with a coup and all those shenanigans.
  - princekolt 8y ago
    Brazil absolutely was a Baron country for most of its life (except they were more commonly called Colonels or Captains). Starting on the 16th century the Portuguese kingdom would distribute land for agrarian usage, and the Barons not only owned the land but its ownership was also hereditary. An intricate taxation system was developed that stimulated lang aggregation and so not long after you'd find many of these land owner families owned immense tracts of land - larger than cities or states, and became very rich. As centuries passed, this system of power persisted, and there is still very very old money in Brazil. Many of these families would give tracts of land away for poor people in exchange of political support, and so they grew into the national political scene. Numerous past presidents came from these families (such as Sarney and Collor). In short: Brazil has a longstanding colonial culture that persists even though its population might not be aware of it. All its symptoms are still there, including distrust in political entities, assertion of political power by intimidation or populism, archaic taxation systems, and a general sense of powerlessness to change things.
fb03 8y ago
Brazil has the potential to be good and make anything bloom, be it startups, big corp etc. It has a good geographic area, plenty of natural resources (water, oil) and whatnot. BUT! What keeps Brazil from entering the row of 'actually a good place to live' countries is nothing but the rampant corruption and the sheer amount of bureaucracy involved in anything regulation or taxes in the country. It's not a matter of simply high taxes, but mainly a really complex system of hoops one has to jump to incorporate even a small and simple company. This sucks.
- rbanffy 8y ago
  We also have a very serious issue with electing the wrong people. São Paulo, the richest state in the country, has been electing the same centre-right (dressed as centre-left) kleptocrats for about 30 years now, with disastrous results. And don't get me started on that "impeachment" shitshow.
diegoholiveira 8y ago
I'm a Brazilian who use to work at some startups here. I have a strong feeling that we didn't produce more and better companies because of two things: 1) Public Universities here hates private money and do business, entrepreneur classes are rare and most of the teachers never did create a company (to teach here you must be an academic, a successful entrepreneur can't give classes about it). If you suggest to your teacher to start a business with his Ph.D. thesis, probably, he will feel offended by your suggestion. 2) Our legislation is bad. I'm mean, very very bad. Open a company in Brazil is crazy: - So many taxes. I'm not talking about the value that you pay here, I'm talking about an insane amount of taxes. At the federal level, for example, there're 6 or more different taxes. And if you need to send a package across states, you need to deal with a lot of bureaucracy to transport it (and more taxes); - Labour protection here is insane too. It's not cheap for small and medium companies. And there is a thing that makes it even more complicated for startups: legally, the owner of the company is in charge of the labor debts even when the company is broken. So, if your company broke, you can't close it until you pay all the labor debts, and if you don't pay, you can lose your home or other assets that belong to you, not to your company; - Almost everything here is regulated, and our regulations are not easy to deal with.
- chrisbennet 8y ago
  ”Labour protection here is insane too. It's not cheap for small and medium companies. And there is a thing that makes it even more complicated for startups: legally, the owner of the company is in charge of the labor debts even when the company is broken. So, if your company broke, you can't close it until you pay all the labor debts, and if you don't pay, you can lose your home or other assets that belong to you, not to your company;” This is pretty normal, you need to lay off people before you run out of money to pay them. You don’t gamble with your employees paychecks. As a business owner, you get the upside if business is going great. The downside is that you, the owner, only get paid if there is money left over after you pay your employees.
  - deleted 8y ago
    [deleted]
  - 8y ago
cscotti 8y ago
I used to work at a Robotics startup in Brazil. Talent was top notch - I’d say as good as any big Bay Area tech company (SWE, Mech & Financial). Founder was the main investor - he didn’t understand SW, treated SWEs & Mech Engs as if he was making them a favor for giving them a job and paid below market. At one point the guy fired the CFO for authorizing buying a cheap Split AC for our little 10ppl office in the middle of the summer while everyone was sweating their life’s away (he was off somewhere on vacation on his boat). But the main takeaway for me was: corruption. The startup was doing something legitimately exciting and innovative but still the founder thought it was wise to sneak in a contract with his buddy at the state government’s office (super shady bidding process) to have them as a first client. Eventually the law caught up with it and the whole thing became a legal mess. + Equipment import taxes were ridiculous! Oh yeah, and we had to buy our own coffee!!!!! Sacrilegious!
kikoreis 8y ago
I'm a Brazilian, living in São Paulo state. I've lived here for 35 years, and before that lived in a number of other countries. In my current role, I do roughly 50% international travel. There's only one thing I'm certain about this post: it's that most brazilian commenters here will zero in on everything that's wrong about Brazil, regardless of the facts. I don't yet have a grand theory for why this happens, but it usually does. Anyway, on to the topic of the post. Brazil has a really great startup scene, and there are many small and new companies popping up everywhere with interesting ideas. I've had my own companies participate in acceleration rounds and pitches and have been positively impressed with the quality of the programs and participants. In the past five years, funding has become much easier to get access to, and there are good hubs to exchange ideas and find talent to hire. Lots of interns and trainees coming out of university are hungry and talented, so there's a real talent pool to leverage. And the potential customer base for any class of product is massive. A lot of the negativity will be around legislation, taxation, etc. From decades of experience both here and abroad, I can say Brazil doesn't deserve it -- it's easy and cheap to start a new company, and while taxes aren't trivial they are for the most part handled entirely by an accountant for a monthly flat fee. Yes, there are some vexing circumstances -- I've had companies subject to double taxation due to bureaucracy, and handling the chain of tax credits for physical goods that cross state boundaries is annoying. But by and large, for software companies, these are not very relevant concerns. And even with physical goods, there are lots of companies doing e-commerce nationwide, so it can't be that bad. If there is one defining challenge to startups operating in Brazil it is that B2B deals are very slow to close. In my experience this derives from a tendency to undervalue services delivered by small companies, which for young startups is often the meat of a serious B2B contract. You can spend a year working on a 5-digit deal at risk before seeing the first payment from a customer. Often you don't have that runway and have to give up, pivot or die. In comparison, American and European companies tend to be much more agile about buying services. However, the transition to SaaS has made this problem tractable and I have seen many startups selling higher-value SaaS subscriptions successfully. In summary, if you can manage to ignore the negativity, the country has great potential, and another round of successful startups should follow the existing crop the article mentions.
- glibgil 8y ago
dataker 8y ago
I'm Brazilian and I tried building a company there after two successful products both in the EU and US. Brazil simply doesn't have the culture that's necessary to foster a startup ecosystem. Chile is in a much better position to be that sort of local leader, but still only relatively. And it's not something you can change by prosecuting corrupt politicians - it goes all the way back to our colonial heritage, and the crookedness and "classicism" will always hinder the progress of companies and, more sadly, great engineers and entrepneurs. This stereotype that "we're the most creative" is just another self entitlement like soccer or beautiful women that may build a brand, but certainly doesn't represent reality or live it up to its expectations. I've come to realize that a Brazilian in power is often a synonym of extreme arrogance, shallowness, selfishness and an unbearable classicism that leads to an unfathomable mistreatment of both customers and employees. It's unlike any other elites from the western world. It might compare to some countries in Africa. If you're an investor thinking about Brazil , either understand and live by that culture or lose your money. They won't change the habits they gathered for a lifetime just because you have money or moral authority. If you're Brazilian and talented, either as an engineer or entrepreneur, get out. Look for jobs remotely, incorporate a company in another country, find a market fit in a healthy economy that selects based on the productivity, efficiency and quality of your work. Don't gamble your potential, talent and safety for the sake of FOMO on companies that rich, talentless, spoiled kids built with family money, and even our own (as taxpayers).
- zac23or 8y ago
  > Brazil simply has no culture to foster an ecosystem of startups. Yes. A startups incubator in Brazil had a 'pool of developers': if a startup needed a developer, just enter the pool. Incubator startups had just one busines founder, never a technical founder. The technical things in Brazilian culture are irrelevant (any 'manual work' is, and developer is a manual work in Brazil culture).
- zorked 8y ago
  I believe you mean "classism".
- diegoholiveira 8y ago
  > If you're Brazilian and talented, either as an engineer or entrepreneur, get out. Look for jobs remotely, incorporate a company in another country, find a market fit in a healthy economy that selects based on the productivity, efficiency and quality of your work. Sadly, this is very true.
lucasfcosta 8y ago
I must say that even though it might look great for investors and business owners, software engineers suffer a lot. In the recent years, the situation in Brazil has only got worse. The BRL is worth nothing and engineers get a lot less than anywhere here in Europe or the US. Life quality is also bad and it's rare to find a good work environment, especially outside São Paulo. If I had to go back to Brazil, São Paulo is definitely the only city I would live in.
yourstruly-br 8y ago
There is no venture capital here. The biggest funds (Redpoint, etc) here are in fact "growth" funds, i.e. once you get a revenue about BRL 1,000,000 per quarter, you will be considered otherwise good luck. Try to build a technology company here and get the funds and then let me know. Incubators are in fact cheap outsourced innovation departments of large companies. Once you get there (which is not difficult), they will steer your solution to fit the large corporation behind. Largest companies pay lip service saying they support "innovation" by providing start-up competitions. In fact, they buy almost none from start-ups. They are in fact searching for cheap or free technology ideas and services. Absolutely no significant success has come from corporate incubators in Brazil. You are there as a small piece on the board. My advice to start-ups in Brazil? Build as much as you can by bootstrapping and try to sell as early as possible and avoid any "free" pilots by corporations trying to use your solution. Charge and charge upfront. I sadly see too many start-ups providing free services to large companies in exchange of vague promises. You are just a piece used by employees in these large companies to promote innovation and cheap solutions. if large comporations want to support startups they should sign a CONTRACT and BUY from you. That's it! Anything else is just exploitation of technical talent and naiveté from your start-up founds.

72 points by ishikawa 8y ago

rs86 8y ago

It's a myth that Brazilians are more creative. Doing business in Brazil is incredibly difficult - lack of talent, ethics and terrible financial sector.

anderber 8y ago
This seems to be a very myopic view of a large and diverse country. I've seen both extremes when it comes to talent and ethics.
- jorblumesea 8y ago
  Have you been to Brazil? Brazilians take the entire day off to go to the bank because it takes that long and processes are so inefficient. I was shocked at how non functional the society is as a whole. Their national museum just burned down because the country couldn't even allocate funding properly. You expect running a business there is going to be a simple and transparent affair? This is not a knock on the people themselves. They're smart, caring and competent, but to be honest, the country is a mess.
  - adnzzzzZ 8y ago
    As a Brazilian I'm not going to deny that the country is full of problems, but the person you replied to said that the country is big and that both extremes exist. No need to focus only on the negatives when the country has many things going for it.
    - jorblumesea 8y ago
      Completely agree, pretty inflammatory and vaguely racist comment. I think we can also agree things are far more negative than positive nowadays. Temer is really just the another nail in the coffin for functional Brazilian society. Things are looking much more bleak compared to a decade ago.
      - adnzzzzZ 8y ago
        I actually disagree and I'm highly optimistic for the future of my country. But I'm aware that I'm a minority when it comes to this opinion.
        jorblumesea 8y ago
        That's fair, keep the positivity alive! :) But most Brazilians I've talked paint the picture as a dire situation, unfortunately. Best of luck.
  - tambourine_man 8y ago
    >Brazilians take the entire day off to go to the bank That is completely false. I can’t imagine where you got this from. Brazilian baking is years ahead of the US, not that it represents a high bar.
    - diego_moita 8y ago
      > I can’t imagine where you got this from. Perhaps from daily life? There are long lines on most bank branches I go to, unless you're wealthy enough for the manager to pamper you. Red tape in this country is so bad that there is a whole industry to avoid it ("despachantes"). BTW, the trick this industry uses to avoid banking lines is to hire old retired people to buck the line for them (there's a law here giving to old people that privilege). They basically screw everyone else by buying privileges. Some call it the "Brazilian touch" (jeitinho brasileiro), I call it corrupted morals. > Brazilian baking is years ahead of the US Really? To do online banking in your computer with Banco do Brasil you need to ask permission to your branch manager and install a specific virus on your computer. I believe the same goes for Bradesco and Itaú. Many ATMs and branches in small towns are being closed and leaving those places without financial services because mobs moved from big cities to rob those places without good police. And, guess what, people there can't do online banking.
      - tambourine_man 8y ago
        Red tape is bad, but obiquious cellphones helps a lot. The US still uses checks and signed credit card receipts. Compared to that Brazil’s banking system is state of the art. >To do online banking in your computer with Banco do Brasil you need to ask permission to your branch manager and install a virus on your computer Yes, but most people use the phone app, which is ok. Banking on a computer is bad everywhere.
        afarrell 8y ago
        > and signed credit card receipts chip & pin rolled out a year and a half or so ago, including to a small general store in rural central Maine.
- diego_moita 8y ago
  > I've seen both extremes when it comes to talent and ethics. Extremes exist in every country but a bad average exists just in some. Brazilian average is bad.
lucashn 8y ago
Lack of competitive pay makes talent leave the country (source: I have many friends working in startups in USA due to better working conditions).
- rbanffy 8y ago
  Source, yours truly. But what drove me away was not the money - I make a lot more money now, but in a much more expensive place. Retirement projections remain firmly planted on the very same date since I left and aren't going to change much either way unless some major upheaval happens. What really drove me out was my lack of faith. Corruption was rampant (it was always like this, since well before I was born) but it was being investigated, in some cases more seriously than others, but the local equivalents to the DoJ and the FBI (I'm doing this for the Americans in the audience, hope it helps), for the first time since essentially ever, able to work free from executive interference and, unsurprisingly, uncovered a lot of misdeeds. With that, the perceived corruption skyrocketed, government popularity sunk, trust in the government went into a death spiral and the legislative and judiciary decided it'd be convenient to stage a coup (sorry, "impeachment" is not the right word) so that someone more malleable would be in power (there was even a phone recording stating that much). At that moment I was over for me. I grew up in post-64 coup Brazil and don't want my daughter to go through the same.
- malandrew 8y ago
  Couldn't agree more. Of all the engineers I worked with back in Brazil that I would happily work with again, more than 75% of them left Brazil. They now live in places like the San Francisco, Palo Alto, NYC, Toronto, Montreal, Berlin, Amsterdam, London. What's most ridiculous is that at the recent BayBrazil event here in São Paulo, I explicitly asked the panelists if the situation had changed since when I worked there a manager would make 2.5x to 3x what the ICs earned. Every single panelist dodged the question by spouting some bullshit about how people have other motivations besides money for staying in Brazil. Yeah, I'm sure a minority of them do, the majority however keep leaving.
dataker 8y ago
I'm Brazilian and you are completely correct.
epx 8y ago
I am Brazilian and it's been a year since I went into a bank to do anything. All expat friends say that Brazilian bank system is the best. This has a specific reason: inflation in 1980s imposed fast banking service.
- gdsimoes 8y ago
  I am a Brazilian currently living in Canada and I was very surprised when I discovered that Brazil’s banks are actually much better than Canada’s.
  - deleted 8y ago
    [deleted]

theparanoid 8y ago

Brazil has and continues to perform poorly on measures of cognitive competence. It makes Mexico look like academic achievers.

81bdf7bb 8y ago
Well, Mexico did produce that one guy that created GNOME. So maybe he just got lucky?

rodolphoarruda 8y ago

Maybe the country has the largest ecosystem because there are a lot of people in there. That doesn't imply in high quality, positive ROIs etc. Lots of people are just trying.

rbanffy 8y ago
The country has some decent universities, some large and rich cities (despite the country, being, on average, poor) and some entrepreneurial attitude. The drawback I observed the most is the same @cscotti pointed out: the people who end up creating companies are not particularly well suited for that. They want quick money out of outrageous profit margins - they are often already rich, but think they are entitled to more. It's the Brazilian version of the robber baron standard, but in a fractal pattern almost down to the bottom. And, now, there's also the crazy politics (thanks, Obama) with a coup and all those shenanigans.
- princekolt 8y ago
  Brazil absolutely was a Baron country for most of its life (except they were more commonly called Colonels or Captains). Starting on the 16th century the Portuguese kingdom would distribute land for agrarian usage, and the Barons not only owned the land but its ownership was also hereditary. An intricate taxation system was developed that stimulated lang aggregation and so not long after you'd find many of these land owner families owned immense tracts of land - larger than cities or states, and became very rich. As centuries passed, this system of power persisted, and there is still very very old money in Brazil. Many of these families would give tracts of land away for poor people in exchange of political support, and so they grew into the national political scene. Numerous past presidents came from these families (such as Sarney and Collor). In short: Brazil has a longstanding colonial culture that persists even though its population might not be aware of it. All its symptoms are still there, including distrust in political entities, assertion of political power by intimidation or populism, archaic taxation systems, and a general sense of powerlessness to change things.

fb03 8y ago

Brazil has the potential to be good and make anything bloom, be it startups, big corp etc. It has a good geographic area, plenty of natural resources (water, oil) and whatnot. BUT! What keeps Brazil from entering the row of 'actually a good place to live' countries is nothing but the rampant corruption and the sheer amount of bureaucracy involved in anything regulation or taxes in the country. It's not a matter of simply high taxes, but mainly a really complex system of hoops one has to jump to incorporate even a small and simple company. This sucks.

rbanffy 8y ago
We also have a very serious issue with electing the wrong people. São Paulo, the richest state in the country, has been electing the same centre-right (dressed as centre-left) kleptocrats for about 30 years now, with disastrous results. And don't get me started on that "impeachment" shitshow.

diegoholiveira 8y ago

I'm a Brazilian who use to work at some startups here. I have a strong feeling that we didn't produce more and better companies because of two things: 1) Public Universities here hates private money and do business, entrepreneur classes are rare and most of the teachers never did create a company (to teach here you must be an academic, a successful entrepreneur can't give classes about it). If you suggest to your teacher to start a business with his Ph.D. thesis, probably, he will feel offended by your suggestion. 2) Our legislation is bad. I'm mean, very very bad. Open a company in Brazil is crazy: - So many taxes. I'm not talking about the value that you pay here, I'm talking about an insane amount of taxes. At the federal level, for example, there're 6 or more different taxes. And if you need to send a package across states, you need to deal with a lot of bureaucracy to transport it (and more taxes); - Labour protection here is insane too. It's not cheap for small and medium companies. And there is a thing that makes it even more complicated for startups: legally, the owner of the company is in charge of the labor debts even when the company is broken. So, if your company broke, you can't close it until you pay all the labor debts, and if you don't pay, you can lose your home or other assets that belong to you, not to your company; - Almost everything here is regulated, and our regulations are not easy to deal with.

chrisbennet 8y ago
”Labour protection here is insane too. It's not cheap for small and medium companies. And there is a thing that makes it even more complicated for startups: legally, the owner of the company is in charge of the labor debts even when the company is broken. So, if your company broke, you can't close it until you pay all the labor debts, and if you don't pay, you can lose your home or other assets that belong to you, not to your company;” This is pretty normal, you need to lay off people before you run out of money to pay them. You don’t gamble with your employees paychecks. As a business owner, you get the upside if business is going great. The downside is that you, the owner, only get paid if there is money left over after you pay your employees.
- deleted 8y ago
  [deleted]
- 8y ago

cscotti 8y ago

I used to work at a Robotics startup in Brazil. Talent was top notch - I’d say as good as any big Bay Area tech company (SWE, Mech & Financial). Founder was the main investor - he didn’t understand SW, treated SWEs & Mech Engs as if he was making them a favor for giving them a job and paid below market. At one point the guy fired the CFO for authorizing buying a cheap Split AC for our little 10ppl office in the middle of the summer while everyone was sweating their life’s away (he was off somewhere on vacation on his boat). But the main takeaway for me was: corruption. The startup was doing something legitimately exciting and innovative but still the founder thought it was wise to sneak in a contract with his buddy at the state government’s office (super shady bidding process) to have them as a first client. Eventually the law caught up with it and the whole thing became a legal mess. + Equipment import taxes were ridiculous! Oh yeah, and we had to buy our own coffee!!!!! Sacrilegious!

kikoreis 8y ago

I'm a Brazilian, living in São Paulo state. I've lived here for 35 years, and before that lived in a number of other countries. In my current role, I do roughly 50% international travel. There's only one thing I'm certain about this post: it's that most brazilian commenters here will zero in on everything that's wrong about Brazil, regardless of the facts. I don't yet have a grand theory for why this happens, but it usually does. Anyway, on to the topic of the post. Brazil has a really great startup scene, and there are many small and new companies popping up everywhere with interesting ideas. I've had my own companies participate in acceleration rounds and pitches and have been positively impressed with the quality of the programs and participants. In the past five years, funding has become much easier to get access to, and there are good hubs to exchange ideas and find talent to hire. Lots of interns and trainees coming out of university are hungry and talented, so there's a real talent pool to leverage. And the potential customer base for any class of product is massive. A lot of the negativity will be around legislation, taxation, etc. From decades of experience both here and abroad, I can say Brazil doesn't deserve it -- it's easy and cheap to start a new company, and while taxes aren't trivial they are for the most part handled entirely by an accountant for a monthly flat fee. Yes, there are some vexing circumstances -- I've had companies subject to double taxation due to bureaucracy, and handling the chain of tax credits for physical goods that cross state boundaries is annoying. But by and large, for software companies, these are not very relevant concerns. And even with physical goods, there are lots of companies doing e-commerce nationwide, so it can't be that bad. If there is one defining challenge to startups operating in Brazil it is that B2B deals are very slow to close. In my experience this derives from a tendency to undervalue services delivered by small companies, which for young startups is often the meat of a serious B2B contract. You can spend a year working on a 5-digit deal at risk before seeing the first payment from a customer. Often you don't have that runway and have to give up, pivot or die. In comparison, American and European companies tend to be much more agile about buying services. However, the transition to SaaS has made this problem tractable and I have seen many startups selling higher-value SaaS subscriptions successfully. In summary, if you can manage to ignore the negativity, the country has great potential, and another round of successful startups should follow the existing crop the article mentions.

glibgil 8y ago

dataker 8y ago

I'm Brazilian and I tried building a company there after two successful products both in the EU and US. Brazil simply doesn't have the culture that's necessary to foster a startup ecosystem. Chile is in a much better position to be that sort of local leader, but still only relatively. And it's not something you can change by prosecuting corrupt politicians - it goes all the way back to our colonial heritage, and the crookedness and "classicism" will always hinder the progress of companies and, more sadly, great engineers and entrepneurs. This stereotype that "we're the most creative" is just another self entitlement like soccer or beautiful women that may build a brand, but certainly doesn't represent reality or live it up to its expectations. I've come to realize that a Brazilian in power is often a synonym of extreme arrogance, shallowness, selfishness and an unbearable classicism that leads to an unfathomable mistreatment of both customers and employees. It's unlike any other elites from the western world. It might compare to some countries in Africa. If you're an investor thinking about Brazil , either understand and live by that culture or lose your money. They won't change the habits they gathered for a lifetime just because you have money or moral authority. If you're Brazilian and talented, either as an engineer or entrepreneur, get out. Look for jobs remotely, incorporate a company in another country, find a market fit in a healthy economy that selects based on the productivity, efficiency and quality of your work. Don't gamble your potential, talent and safety for the sake of FOMO on companies that rich, talentless, spoiled kids built with family money, and even our own (as taxpayers).

zac23or 8y ago
> Brazil simply has no culture to foster an ecosystem of startups. Yes. A startups incubator in Brazil had a 'pool of developers': if a startup needed a developer, just enter the pool. Incubator startups had just one busines founder, never a technical founder. The technical things in Brazilian culture are irrelevant (any 'manual work' is, and developer is a manual work in Brazil culture).
zorked 8y ago
I believe you mean "classism".
diegoholiveira 8y ago
> If you're Brazilian and talented, either as an engineer or entrepreneur, get out. Look for jobs remotely, incorporate a company in another country, find a market fit in a healthy economy that selects based on the productivity, efficiency and quality of your work. Sadly, this is very true.

lucasfcosta 8y ago

I must say that even though it might look great for investors and business owners, software engineers suffer a lot. In the recent years, the situation in Brazil has only got worse. The BRL is worth nothing and engineers get a lot less than anywhere here in Europe or the US. Life quality is also bad and it's rare to find a good work environment, especially outside São Paulo. If I had to go back to Brazil, São Paulo is definitely the only city I would live in.

yourstruly-br 8y ago

There is no venture capital here. The biggest funds (Redpoint, etc) here are in fact "growth" funds, i.e. once you get a revenue about BRL 1,000,000 per quarter, you will be considered otherwise good luck. Try to build a technology company here and get the funds and then let me know. Incubators are in fact cheap outsourced innovation departments of large companies. Once you get there (which is not difficult), they will steer your solution to fit the large corporation behind. Largest companies pay lip service saying they support "innovation" by providing start-up competitions. In fact, they buy almost none from start-ups. They are in fact searching for cheap or free technology ideas and services. Absolutely no significant success has come from corporate incubators in Brazil. You are there as a small piece on the board. My advice to start-ups in Brazil? Build as much as you can by bootstrapping and try to sell as early as possible and avoid any "free" pilots by corporations trying to use your solution. Charge and charge upfront. I sadly see too many start-ups providing free services to large companies in exchange of vague promises. You are just a piece used by employees in these large companies to promote innovation and cheap solutions. if large comporations want to support startups they should sign a CONTRACT and BUY from you. That's it! Anything else is just exploitation of technical talent and naiveté from your start-up founds.