Post #1

This is a blog about the venture capital and startup ecosystem in Brazil.  But – at least for the next few weeks, before I determine whether this will become a more serious project – it’s also a blog about my love-hate relationship with Brazil, about my experiences in this intoxicating yet (at times) incredibly frustrating country. My hope is that my readership will enjoy a few personal anecdotes, and that these stories will spice things up a bit…  the pimenta malagueta on my arroz e feijão, if you will.

Pimenta Malagueta. Burns so good when it hits your lips.

Pimenta Malagueta. Burns so good when it hits your lips.

Before I share a few thoughts on why São Paulo drives me nuts (in both a good way and a bad way), let’s get the basics out of the way:

Who am I? I’m a veteran Brazilianist with a passion for startups and entrepreneurship. I’ve spent a little over year living and working in Brazil at different points in time. I’m a dual citizen of Mexico and the US. I’m a student at Wharton. I’m in Brazil for the next 5 weeks, evaluating opportunities, expanding my network, blogging, and working on a few ideas of my own. You can learn more about me on linkedin and twitter. And I post some cool pics on Instagram.

Why am I writing this blog? The VC / startup ecosystem in Brazil is AWESOME. The level of talent, intellectual horsepower, and sheer entrepreneurial resourcefulness you find in this country is truly impressive. The opportunity set – albeit not what it once was – is still enormous. I want to share my insights and thoughts on this remarkable community with the rest of the world. I want to illuminate what makes this place special, bust some common myths, and bring greater transparency to an opaque and frequently misunderstood marketplace. In the process, I hope to help others navigate this world in a more intelligent fashion.

What to expect going forward? Over the next few weeks, while I’m down here on the ground in São Paulo, I intend to write roughly 15 – 20 posts on subjects such as:

  • “The Rise of the Unsexy:  B2B in Brazil”
  • “Brazilian startup bubble? My view”
  • “Mexico vs. Brazil: A comparative analysis of challenges and opportunities across LatAm’s twin giants”
  • “How to build an eCommerce customer lifetime value model”
  • “The Rocket Effect: How Rocket Internet is changing the startup landscape in Brazil”

If you’re all business, you can stop reading now. But for those looking for something a bit more visceral and real, I thought I’d offer a little sidebar on the trials and tribulations of life in São Paulo. Before touching down in SP a few days ago, I spent 3 months soaking up the vibe in San Francisco (I was spending a semester at Wharton’s west coast campus). The differences between these two cities are quite striking, and worth pondering.

Let’s perform a quick and dirty comparative analysis – SF: City of ~800,000 people. Quiet, great public transportation, very safe, relatively limited traffic, fantastic outdoor activities a stone’s throw away, robust tech ecosystem, a healthy dose of hipsters, awesome weather, and heavenly Mexican food. Sounds dreamy right?

Now São Paulo: 20 Million people. Inescapable gridlock-level traffic, unending noise from cars, construction, fireworks (people seem to have something to celebrate every single day), planes flying overhead constantly (no joke, Congonhas airport is literally smack-dab in the middle of the city), obscenely expensive (worse than NYC I’d say), fairly unsafe (ask me about my bad experiences), sub-par public transportation, frequent torrential downpours.

Congonhas airport. Right in the middle of the city.

Congonhas airport. Right in the middle of the city.

So why I am such a big fan of this city? Why can’t I stay away?

For one, the opportunities to create meaningful change and generate significant economic value through entrepreneurship are enormous. In fact, the very things that make São Paulo so painful to live in sometimes are the very things that make it a place so palpably ripe for disruptive innovation. Almost all of the pain points I encounter here on daily basis represent opportunities for technology-driven value creation. There are real problems that need to be solved here, tremendous, glaring inefficiencies just waiting for an entrepreneur’s data-driven touch. This is one of the characteristics that makes São Paulo such an exciting place.

The second reason I love this city is more personal in nature, and it’s somewhat tough to explain, especially to those who’ve never been here before. There’s something about the unrelenting optimism of Paulistanos, their insatiable thirst for life, the energy they exude – that I find addictive. The city pulses with energy at all hours, every day, to a much greater extent than NYC. São Paulo truly is a sea of humanity, 20 million people in the greater metro area, high-rise residential towers stretching as far as the eye can see, a veritable ocean of steel, glass, and cement. At first, it’s smothering; once you adjust, it’s intoxicating. This is a place where you can’t help but feel alive. Could I live here for the rest of my life? I’m not sure. Could I build a business here over the next 5 – 10? For sure. My good friend Alykhan feels the same way.

Okay, enough waxing poetic about SP. Next post will be business-oriented. Check back often as I intend to post roughly every other day for the next 5 weeks. Thoughts, comments? Something you’d like me to write about? Hit me up at baldwint@wharton.upenn.edu. Catch you on the flipside.

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12 comments

  1. JHAS

    There is a point when you qualify a good -Startup ecosystem- for just being big (thousands, millions of customers), or being atractive for enormous companies. But the thing about the brazilian market, is that not all of the products/services are sold in the same way as Northamerica, neither Mexico. If you decipher that in your startup, you my friend, found gold in it.

    • thomasgbaldwin

      JHAS – totally agree that simple cloning of foreign businesses with no attempt to adapt the model to local realities can be dangerous… Things like trust, logistics, expectations around customer service, and much more are very different here, and the way in which you formulate your strategy needs to take this into account. Thanks for reading and check back soon! – Tom

  2. Davis

    Excited to follow the blog, Tom. I can already tell some of the posts are going to be awesome. Looking forward to reading them.

    • thomasgbaldwin

      Thanks Davis – much appreciated! Glad you found your way over and I hope to keep you “hooked” over the next few weeks with some really solid and insightful material. – Tom

  3. Pingback: The Current State of VC in Brazil « Tropical Considerations
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