Tech Roundup, Mar. 6, 2019 | Brazil-made facial recognition beats plastic surgery

. Mar 06, 2020
the new made-in-Brazil facial recognition system. The booming ecosystem for marketing startups. Retailers' "new Black Friday." Photo: Varuna/Shutterstock

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: the new made-in-Brazil facial recognition system. The booming ecosystem for marketing startups. Retailers’ “new Black Friday.”

Brazilian startup develops plastic surgery-proof facial recognition

A system accurate enough

to distinguish between identical twins and people who have undergone plastic surgeries. That’s what Brazilian facial recognition startup FullFace is offering, with made-in-Brazil technology.&nbsp;</p> <p><strong>How does it work? </strong>FullFace’s technology analyzes 1024 facial points and 256 face images to identify a user. Moreover, it stores the image as a 16,000-digit number, from which it is not possible to assemble an image. “If someone intercepts our database, they won’t see the picture of any customer,&#8221; explained CEO Danny Kabiljo to <a href=""><em>Globo</em></a>. The service is also software-based and is available on the cloud.&nbsp;&nbsp;&nbsp;</p> <p><strong>Why it matters. </strong>Debates on facial recognition are increasing in Brazil, as the country gets ready to implement its new Data Protection Law (LGPD). Foreign alternatives, such as Chinese technologies, were targeted by a public backlash last year, as Brazilians <a href="">fear how their data would be handled</a>.&nbsp;</p> <p>So far, facial recognition has been used by the government mainly for <a href="">security purposes</a>, as in the famous case of a wanted criminal who was arrested by Salvador city police in 2019’s Carnival, while he was wearing a costume.</p> <hr class="wp-block-separator"/> <h2>Brazil’s booming martech ecosystem</h2> <p>The inefficiencies of Brazil’s banking system made the country fertile ground for fintechs, and it is now home to companies such as <a href="">unicorn Nubank</a> and PagSeguro. Now, a startup accelerator believes a similar process may happen in marketing. Founded in 2019, Circle is specialized in marketing tech startups, or &#8220;martechs.&#8221; The project was born out of parent company and marketing agency Netza, which needs access to new and innovative products to remain relevant at a time when traditional advertising techniques are increasingly questioned.</p> <p><strong>Competition. </strong>The Brazilian martech ecosystem is growing, according to <a href="">a study </a>by Liga Ventures: in 2019, Brazil had 266 martechs, a 37-percent increase from 2018 levels. While the pool of resources for venture capital in Brazil has also been increasing, these companies battle among themselves for funding, but are also competing with more established startup sectors, such as fintechs and edtechs.&nbsp;</p> <p>According to Circle CEO Fernando Ribeiro dos Santos, martechs have a disadvantage in this point, as they’re still valued according to traditional metrics such as revenue. He does not see unicorns rising in this field for the next four to five years, but singles out Dino and Resultados Digitais as players to watch in the sector.&nbsp;</p> <p><strong>Perspectives. </strong>Circle has already accelerated five startups and aims to end 2020 with ten. So far, BRL 1.5 million has been invested in the project and Mr. Dos Santos expects to apply another 2.5 million by 2021. They currently invest in startups across several areas of marketing, such as artificial intelligence, rewards programs, and even corporative messaging for events.</p> <p><strong>Opportunity. </strong>According to IAB Brasil’s annual <a href="">Digital AdSpend survey</a>, digital ads consumed only 30 percent of the BRL 16.12 billion invested in Brazilian advertising in 2019. As a comparison, that share reaches 52 and 55 percent in the UK and Canada respectively, showing how much room there is for growth in Brazil. The same survey indicated a future 30-percent increase in digital ads in Brazil, leading the overall market to total BRL 20.95 billion.&nbsp;&nbsp;</p> <p><strong>Business model. </strong><a href="">Digital marketing</a> is currently dominated by tech giants such as Google and Facebook, which not only hold every measurable data available for their platforms but also have the power to change algorithms and affect business strategies. While this may be a risk, Mr. Dos Santos believes that the agility of martechs is an advantage. “If you have a traditional agency, it takes too long to adjust a plan. Martechs have the chance to create new paths and customers need their agility.”</p> <hr class="wp-block-separator"/> <h2>Is Consumer’s Day Brazil&#8217;s new Black Friday?</h2> <p>Brazilians are gaining confidence in the economy and their own finances, which is a promising sign for 2020&#8217;s Consumer’s Day, according to a new study by Google Brasil and Ebit. The March 15 shopping spree created in honor of consumer rights could become even more important to <a href="">boost consumption</a> this year, as economists believe the Brazilian economy will be hit hard by global wobbles caused by the coronavirus outbreak.</p> <p><strong>“Half of twice the price.”</strong> Brazilian retail is notorious for <a href="">misleading advertising</a> in shopping sprees such as Black Friday and that became evident in the survey, as 21 percent of interviewees said this the most disrespected consumer right in Brazil. However, honest advertising comes in second when customers were asked about which right they see as most important, behind kind service.</p> <p><strong>What do consumers want? </strong>According to Google, smartphones were mentioned by 22 percent of interviewees as the product for which they are more anxious to receive discounts. Next up is clothes and accessories (13%), televisions (6%) and computers and electronic equipment (6%).</p> <p><strong>Tracking record. </strong>The number of searches related to Consumer’s Day on Google jumped 20 percent in 2019 in comparison to the previous edition. Revenue obtained during the event totaled BRL 1.17 billion according to the study—in a month that has few events to boost retail.</p> <hr class="wp-block-separator"/> <h2>Take note</h2> <ul><li>Complaints related to digital ads amounted to 70 percent of all cases trialed by Brazil’s<strong> </strong>National Council of Advertising Self-Regulation (Conar) in 2019. According to <a href="">data released by the agency</a>, 329 complaints were analyzed and 75 percent led to some form of punishment, such as interrupting or changing campaigns and warnings to the agency and advertiser.</li><li>Tech company Positivo presented the best price in a public bidding process to supply Brazil’s electronic ballot boxes for the 2020 municipal elections: BRL 799 million v. the BRL 1.7 billion charged by competitor Smartmatic/Diebold. The Electoral Supreme Court will choose the winner in up to three weeks.&nbsp;&nbsp;&nbsp;</li><li>CNN Brasil, which goes on air in the country on March 15, <a href="">announced</a> it will also launch CNN Brasil Business, a website focused on business issues such as macroeconomy, personal finances, investments, 4.0 economy, and technology.&nbsp;&nbsp;&nbsp;</li><li>Brazil reached 34th place in The <em>Economist</em>’s <a href="">Inclusive Internet Index 2020</a>, which assesses how 100 countries are making internet access more inclusive. The performance made it the second-highest ranked Latin American country in ranking. Each country is judged by internet availability, affordability, readiness, and relevance. While Brazil reached the top 22 in terms of affordability, its weakest category was readiness, particularly in levels of digital literacy and web accessibility.

Natália Scalzaretto

Natália Scalzaretto has worked for companies such as Santander Brasil and Reuters, where she covered news ranging from commodities to technology. Most recently, she worked as an Editor for Trading News, the information division from the TradersClub investor community.

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