Quite a few BayBrazil members are currently traveling to watch the World Cup in soccer land. Our Board Member Andy Tsao, Global Gateway Managing Director of Silicon Valley Bank, just returned from Rio de Janeiro and sent us his impressions on the Cup & business opportunities in Brazil.
I arrived in Rio de Janeiro on Sunday at the front end of the Copa do Mundo. The flight down was full of excited soccer fans, sporting their colors mostly from Mexico and Team USA. The singing and chanting that often comes along with partying and revelry was in full swing until about midway through the trip when folks finally settled down. Worries about the logistics of getting to Copacabana from the airport quickly disappeared as the taxis ran completely as usual, and the traffic on Sunday morning was non-existent (typical at that time of the week). The atmosphere on Copacabana was electric. Rio and FIFA have constructed a large area for fans to enjoy the World Cup, which they called the FIFA Fan Fest Rio de Janeiro. Right on the beach, the large area included a ginormous TV screen, stage with entertainment, a zip line, amusements and plenty of Brahma (the local beer). Argentines in their azure and white colors dominated on Sunday when their national team and superstar Lionel Messi took to pitch for the first time at Rio’s legendary stadium Maracana. Argentine flags were waving, drums were beating, supporters dancing and singing themselves into a fevered pitch, and all ended well for them with a 2-1 win over Bosnia. The French were also making some noise at the Fan Fest in their navy attire when they televised Les Bleus 3-0 victory over Honduras. Somewhat whimsically the French were waving baguettes around to cheer their team on – glad to see not everyone is taking it so seriously.
Monday, the Rio Conferences were in full swing and, I, on behalf of Silicon Valley Bank (SVB), was speaking at the Technology Conference. The Rio Conference is running during the month of the Copa do Mundo, with a conference each week for five sectors that Rio de Janeiro is emphasizing and feel are strategic to the city. I was invited by Rio Negocios the public private partnership with the City Hall of Rio that helps with foreign direct investment into Rio amongst other things. The audience at the Technology Conference was made up of about 150 senior Brazilian executives in the sector. The day started with Virgilio Almeida, Executive Secretary of the Science, Technology and Innovation Ministry and Carlos Bernardo, Communications Minister, who spoke of the growth and importance of the tech sector in Brazil. I tweeted that Brazil’s IT spend is expected to grow 12% in 2015 versus an expectation of 4% for the rest of the world, so still lots of opportunity for international and domestic technology companies. Other Bay Area attendees who have a growing interest in the Brazil market included Uber, Twitter, Virgin Mobile and US Market Access Center.
The next panel included the heads of the Brazil business for EMC, Microsoft, Oracle and Intel, some of whom I’ve had a chance to meet before. They addressed innovation trends within Big Data. My session on social and mobility followed. Fellow panelists included Patricia Ellen, a Senior Partner at McKinsey, and Gabriella Darenne, a Region Director for one of the largest Brazil telco carriers- Claro. Our moderator was Cezar Taurion, who had been a senior exec with IBM for many years before starting his IT consulting firm, and his questions to me were largely about the startup ecosystem in Brazil and the areas where innovation is occurring. I discussed some of the reasons why we at SVB continue to feel excited about the opportunities in Brazil. Despite some of the changes in the funding environment and the slowing economy, we see passionate entrepreneurs, a talented but developing VC community, and that the many inefficiencies in the market provide startups tremendous opportunities for growth. I reiterated the same message in the interviews I gave to the press including the Estado, one of the more established newspapers.
Monday evening the Americans at the conference were invited to watch US v Ghana at the iconic Jockey Club. It turns out they had a sprawling Fan Fest set up there as well. Sadly, interest in watching the US game was clearly not a priority as the large complex was mostly empty and our guest viewing area only included about fifteen people. Many of us were also recovering from the long commute from Copacabana, as Rio’s ugly traffic problem reared its head. It took us over an hour to travel the four miles to the Jockey Club and my group ended up missing the entire first half. That was quickly forgotten when John Brooks scored the go ahead goal with a terrific header that gave the US a critical 2-1 win. We enjoyed some Caipirinhas and great Brazilian barbequed meat at a perfect little local neighborhood restaurant to cap off the evening.
Tuesday’s activities included watching the Brazil v Mexico match at the Fan Fest on Copacabana. There was a sea of yellow and green jerseys, the colors of the national team, and the crowd was ready to explode for a home victory. It seemed like the entire city and probably the country had come to a halt as the clock ticked forward towards match time. Chants of “Bra-zil! Bra-zil!” echoed throughout Copacabana. Brazil looked somewhat tentative against a scrappy Mexican team, and Mexico’s goal keeper made a few phenomenal stops against Brazil’s star Neymar to seal the 0-0 draw. While I think Mexico is playing at a high level, Brazil left the debate open if they can step up and win the tournament as expected….they may be the best team, but it is an awful lot of pressure. Despite the frustration felt by the hundreds of thousands of supporters at the Fan Fest, the crowd meandered around Copacabana peacefully, and the Brazil security was out in full display with a very strong and visible presence to make sure it stayed that way. Despite having heard about some petty crime, the atmosphere felt generally friendly and safe considering the large and raucous crowd.
On Wednesday several of us gathered at the request of Startup Rio, a new initiative to accelerate the development of the startup ecosystem in Rio. We discussed how we might build and maintain a bridge between Rio and the Silicon Valley, including the merits of establishing a physical presence in the Bay Area. We also discussed the many challenges that work against Brazilian entrepreneurs such as the fear around failure, and the lack of role models and mentors. The marquis event in the afternoon was a trip to Maracana to watch live the defending World Cup champions Spain take on traditional Latin American powerhouse Chile. Spain was under a lot of pressure given their disastrous opening 5-1 loss to the Dutch. Chile on the other hand played inspired football and took it to the Spaniards with a convincing 2-0 win, eliminating them from the World Cup. Maracanã holds about 80,000 spectators, and I would guess that about 75,000 of them were from Chile. It very much felt like a home match for Chile and fans provided a lot of high decibel support for their team. They certainly left the stadium in jubilation.
In all it was a fantastic day, an exciting match, a legendary stadium… bucket list checked. Rio continues to develop a promising early stage entrepreneurial ecosystem and I look forward to my next visit. While Brazil still struggles with all the challenges and opportunities that come with a large emerging economy, at least for this week the combination of Rio and the Copa Do Mundo was magical. I can’t help but feel a little more Carioca now… :)