Brazil-based corporations are increasingly active in venture investments with two unit launches in the past week and a survey of 68 businesses revealing more are investing in startups.
Brazil-based conglomerate Algar has set up a corporate venturing unit to cover its main sectors.
Algar Ventures will cover information and communication technology (ICT) on behalf of Algar Telecom and Algar Tec; agribusiness for Algar Agro and Farming; services for Algar Aviation, Algar Security and ComTec; and tourism for the conglomerate’s River Hot Group.
The fund will invest 5% of the group’s net income, which was R$200m ($60m) last year on R$4.8bn of sales, and will work with accelerators and incubators as well as investing in startups directly or through VC funds.
Clau Sganzerla, vice-president of strategy and innovation at Algar, is leading the initiative. He told news provider Startupi (translated by Google): “Our role is to be open to the entire maturity spectrum, from incipient projects to more mature companies.”
Separately, Brazil-based insurer Porto Seguro has started Porto Capital. Its first fund, Porto Edge Growth I, has R$400m of capital to invest primarily in medium-sized companies with revenues between R$50m and R$150m.
Marcelo Picanço, chief financial officer responsible for the Porto Capital, which will also try and raise money from third-parties, told Startupi: “We seek to differentiate aligning clear industry focus, business intelligence, experienced team and structured investment management.”
Porto Capital will have two managing directors, Anibal Messa and Frederico Mesnik.
The two launches follow a wave of interest in corporate venturing in Brazil following the first Corporate Venture in Brasil conference held in Sao Paulo last October by the Brazilian Trade and Investment Promotion Agency, Apex-Brasil, and curated by Global Corporate Venturing (GCV).
This event followed an economic downturn and focus by government agencies on innovation to offset falling agriculture and raw material prices in the past few years as China’s economy, Brazil’s large export market, has slowed.
Earlier this month, US-based corporations Monsanto, Microsoft and Qualcomm formed a partnership to invest up to R$300m in Brazil-based agriculture-focused startups, while Accenture, Santander and IE Business School ran a fintech venture day in Sao Paulo in April.
Vinicius Scaramel, CEO of Brasil Ventures, a corporate-backed accelerator and VC, in partnership with Apex-Brasil has surveyed 68 corporations about their views on innovation and investing in and working with startups. Scaramel said there had been a 16 percentage point rise in the number of corporations investing in startups.
In 2015, 59% of respondents had invested in zero startups but this year the number had fallen to 43%, with a commensurate rise in the number of corporations investing in one to five startups.
The full results of Brasil Ventures’ survey will be published at the second annual Corporate Venture in Brasil conference on 24-26 October. Potential speakers and attendees can contact GCV for an invitation and discussion on the program.