You’re reading The Brazilian Report‘s weekly tech roundup, a digest of the most important news on technology and innovation in Brazil. This week’s topics: Brazil a hub for unicorns; the race for digital maturity in Brazil; Twitter Brazil has a hate speech problem. And more.
From unicorns to “IPOgriffs”: how Brazil became the hottest spot for legendary-growth companies
A report by Distrito puts Brazil as one of the most important hubs for unicorn companies worldwide, as five new startups reached valuations over USD 1 billion in 2019, the third-best performance in the world. Together, Brazil’s 9 unicorns amassed USD 1.23 billion in investments last year, enough to bring another company into their dream team.
Unicorns or IPOgriffs? Distrito has updated its definition of unicorn companies to be compliant with the international definition of a privately held startup company that is valued over USD 1 billion. Due to the change, NYC-listed companies Arco Educação, PagSeguro, and Stone Pagamentos are now IPOgriffs (a portmanteau of IPO and hippogriff). Nubank, Brazil’s first unicorn, was also updated to the status of “decacorn,” after reaching a valuation of USD 10 billion.
What explains the boom of unicorns? In Distrito’s view, the low-interest-rate environment around the world has increased the appetite for riskier investments, while the increasingly frequent success stories have turned startups into a more interesting target for investors.
Slow and steady. Compared to the U.S. and China—who have 50 and 25 percent of the world’s unicorns—Brazil appears to be lagging behind, especially considering that a local company takes six years on average to reach that status. However, Brazilian companies’ more cautious approach may be worthwhile at a time when companies such as Uber and Slack are seeing a steep...
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