The investor who didn’t want to take a chance in 2021 may have had some disappointments. Inflation knocked down traditional investments and the Stock Exchange saw its main index, the Ibovespa, drop 11.93% in 12 months.
The uncertain crypto asset bitcoin, on the other hand, emerged as one of the best investments of the year, accumulating a gain of 75.83%. The currency, native to the digital environment, takes the lead in the same year in which Brazilians awaken to applications related to the risky market of innovation.
In 2021, a record year for investments in startups in Brazil, more than BRL 72.4 million were placed in technology companies in São Paulo through collective investment platforms such as CapTable, responsible for the survey. The result is almost 4.5 times what was invested in 2020 in the same state, when the total almost reached R$ 16.2 million.
Investments made through ten platforms were compared: CapTable itself and its competitors SMU, EqSeed, Kria, Beegin.invest, Organismo Brasil, Whishe, Clearbook, Efund Investimentos and Cluster 21.
They are intermediaries between the investor and the startup, which previously raised money in a more restricted universe of investment funds and, when possible, family and friends. With a simple registration on a website and minimum amounts of BRL 500, BRL 1,000 or BRL 5,000, anyone can bet on startups.
Regulated by the CVM since 2017, equity crowdfunding, as it is also called, allows companies that earn up to R$10 million a year to raise up to R$5 million from investors through authorized platforms.
“The pandemic was a tailwind”, says CapTable co-founder Guilherme Enck about the investment boom in the sector, which tripled in the last year. “It didn’t change any trends, but it accelerated something that was already happening.”
He refers to the digitization that society has seen in the last two years with the distancing measures taken to avoid contamination by Covid. Added to this is the historic low of the basic interest rate, the Selic, which in 2020 was frozen by the Central Bank at 2% and remained so for seven months, until March this year.
“The group ends up running away from fixed income and putting companies in real assets”, says Enck.
This class he refers to has the profile of an early adopter, in English jargon that could be translated as an “early adopter”. With an eye on consumer changes and the heated technology market around the world, these investors are betting that startups in Brazil tend to continue growing, as in other countries.
“They are anticipating that the next wave is technology companies taking over the Stock Exchange here in Brazil, as is already happening”, says Enck.
On CapTable, 90% of users are men (a characteristic that they try to change through projects), 70% are from the South or Southeast and most are between 28 and 40 years old, although most of the contribution comes from people with more than 40. The average user investment is R$ 4,500 per startup — far from the overwhelming majority of the Brazilian population, but relatively little when we talk about the billionaire technology market.
The entry of this investor is also a hand in the wheel for the other end, the entrepreneurs.
From funding from R$200,000 to R$350,000 in startup accelerators, the founder had to jump into large venture investment funds, which deliver checks in the millions of reais. “There was a gap in the market, a step that was not being met and that became known suggestively as the valley of death”, says the businessman. This investment vacuum occurs just as many of these companies are operating in the red in exchange for expanding and beating competitors.
Collective investment platforms can help startups make it through the valley unscathed, but the market still carries risks. Amid the correction of market values of large fintechs, as startups in the financial sector are called, discussions about a possible bubble in the technology sector are gaining strength.
“The correction comes very much in the wake of the liquidity spree that we had all over the world”, says Enck. “This balance that would be natural for the market was boosted by very low interest rates.”
Since December, the Selic rate has been at 9.25% per year, and should continue to grow in 2022: a Focus survey released by the Central Bank this Monday (10) shows that the market’s expectation is the basic interest rate at 11, 75% at the end of the year. The data, which can make the investor turn to safer options, does not shake the optimism of the entrepreneur, who bets on behavior change as an engine for the growth of individual investment.
“There is no clear correlation between the macro scenario and the technology scenario. We have a moment of crisis in Brazil and the technology market is growing”, he says.
Despite the uncertainties in an election year, which according to him “will, yes, harm a little the decisions of resource allocation”, startups should continue with favorable winds. “I have no doubt that in 2022 the sector will continue to grow”, he says.
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I have over 8 years of experience in the news industry. I have worked for various news websites and have also written for a few news agencies. I mostly cover healthcare news, but I am also interested in other topics such as politics, business, and entertainment. In my free time, I enjoy writing fiction and spending time with my family and friends.
