Executive assesses current scenario and gives tips to new entrepreneurs
U-Start, boutique advisory for European investors interested in investing in digital startups from emerging markets, held its first event in the country on February 8: the U-Start Conference Brazil 2014. At this meeting, four Brazilian businesses were chosen to compete with companies from Italy, Switzerland, Russia and South Africa spaces in the international entrepreneurship scene. check out on here the winners of the Brazilian stage.
The main objective of the event is to evaluate startup digital projects that are ready to leverage business, inside and outside the country. The global conference will take place on May 13th and 14th in Milan, Italy.
In an exclusive interview with Portal ABES, Luiz Rinke, main executive of the consultancy in Brazil, analyzes the current scenario of startups and gives tips for those who want to follow this path and succeed.
What are the factors that have driven this whole movement around startups in Brazil and in other regions of the world?
All this attention and visibility given to startups, whether here in Brazil or abroad, comes from the importance that technology receives in people's lives on a daily basis. The advancement of technology allows everyday problems to be solved in new and creative ways through the use of smartphones, tablets, computers. The penetration of the internet and its use in these countries enables more and more new startups to be created. It is the entrepreneurial impetus mixed with technological curiosity, together creating new ways of interacting with the world.
Are there differences between the profile of Brazilian startups and those created in Europe or the United States?
What is different between Brazilian and foreign startups is the level of knowledge and specialization of the entrepreneur. Each of these startups focuses (or should focus) on solving local problems, experienced in the daily lives of its population. The educational problem we have in Brazil is undeniable, with bad schools, colleges of dubious quality and lack of government attention in this regard. We need to better train Brazilian entrepreneurs, give them the possibility to reach the same level as Americans or Europeans.
What are the guidelines for a startup to achieve success?
A startup starts to achieve success when its product/service really proves to be useful, reaching a specific problem and, today, the field for this in Brazil is huge. In addition, it is necessary that the entrepreneur knows the market he is entering very well and has the necessary knowledge to get the project off the ground. A good idea without a competent enough team to make it a reality will always remain a good idea. The startup needs to surround itself with the right, strategic partners for the company's growth, such as mentors, angel investors, venture capital managers, with knowledge in the area. Money alone is not that important – “smart money” brings much more benefit to the startup.
There are different sources of funding (seed capital, private equity, venture capital, finep, BNDES, etc). How to know what is best for a startup?
It all depends on the stage the company is at. Money coming from family, friends or enthusiasts is more in line with an idea in the first stage, which needs start-up capital to get off the ground. Don't expect to receive a private equity investment at this stage. As the company grows, angel investors (seed capital) enter, followed by rounds of Venture Capital (Series A, B). Investments from Finep, BNDES or private equity are far beyond the reach of a startup.
Talk a little more about the objectives of the U-Start Conference at a global level. In which countries does it occur the most? How will the global stage of the U-Start Conference, in Milan (Italy), in May?
The U-Start Conference is the annual conference held by U-Start, in order to bring together its entire international network of investors and entrepreneurs in Milan. In 2014, we have four satellite conferences scheduled, in São Paulo, Cape Town, Moscow and Lugano, selecting the four best startups from each of these countries for the international stage in Milan, in May. The global stage will consist of panels on each of the markets where U-Start operates (South Africa, Russia, Brazil, Chile, Italy and Turkey), with internationally renowned speakers in the sector and an international competition for startups, which will give to its winner an equity commitment. The idea is that once a year, the entire U-Start global network can get together for days of intense networking, exchanging knowledge and experiences. This, by the way, is what we believe to be the greatest value that U-Start offers with its local and international conferences. All satellite conferences, as happened in Brazil, will be attended by invited foreign investors.
Would you like to highlight other information about U-Start?
U-Start is a boutique consultancy for European investors interested in investing in digital companies from emerging markets. Through its local teams, U-Start is able to ally itself with the main players in these markets and identify, according to the portfolio and specificity of each investor, the best investment opportunity, assisting them in all phases of negotiation and deal closing. Present today in 7 countries (South Africa, Russia, Brazil, Chile, Turkey, Italy and Switzerland), U-Start provides services to approximately 120 European clients (family offices, venture capitalists, corporate ventures), all interested in diversifying their investments in these countries. In addition, given the network that U-Start creates in each of these countries, it is possible to help companies scale their business to any of these 7 countries, by identifying the ideal strategic partners and potential investors.
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