This following quote is the only part that actually matters in this article. Because of the scarcity of capital, startups have to become profitable asap, and so

This following quote is the only part that actually matters in this article. Because of the scarcity of capital, startups have to become profitable asap, and some even build non-core products or services (such as consultancy to large firms) just so they can struggle a couple more months, diverting resources from the main product/service: "Because of the lack of a robust early financing market, several accomplished early stage entrepreneurs, with companies that are producing real revenue- something Silicon Valley entrepreneurs perpetually promise is on the horizon (wink, wink)- have had to go one by one knocking on rich peoples’ doors pleading for money. They have had to convince the country’s often very traditional elite that there is a huge opportunity in the web/mobile and that they should invest. As a consequence, all too often, Brazilian entrepreneurs have had to resort to raising small rounds at low valuations and have had to sell their companies before they should have."