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 future of Brazilian startups after the pandemic. Retailers’ bets to weather the crisis. Internet accessibility is an issue in Brazil.
What does the future hold for Brazilian startups?
Before the Covid-19 pandemic, Brazil was perhaps the most promising startup ecosystem in Latin America. However, with the disruption caused by the crisis — and expectations of a significant decline in venture capital, the future seems uncertain for the sector. The Brazilian Report discussed the future for the sector with Amure Pinho, chairman of the Brazilian Association of Startups (ABStartups).
Is the ecosystem in Brazil strong enough to weather the crisis? Is there a chance of massive bankruptcies?
I don’t think there will be that many bankruptcies, because startups specialize in living with little money. I see adaptations going on, cost-cutting … Some have fired part of their staff, others were able to negotiate wage reductions. But I don’t see startups closing shop. Those who had their revenues reduced to zero are having to find alternatives, but others have already managed to go back to pre-Covid-19 levels and there are those who actually grew in this time.
But with venture capital expected to hold back on spending, will Brazilian startups have enough cash flow to hold on?
Some startups had just fundraised, but those who were preparing new investment rounds suffered a little. I don’t see a funding shortage, though. Investors remain looking for good opportunities. It’s more about timing than capital shortage.
If these funds are eventually drained, should we expect a wave of startups going public?
I think that, in...
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