Brazil VC Investment: YOY Growth
After an extensive search through industry-related websites, PE & VC databases, third party research reports, and industry statistic portals, details about the YoY growth for VC investment in the Brazilian tech industry do not appear to be available in the public domain. However, the research team was able to garner valuable insights around the PE and VC investments in the Brazilian technology sector, overall VC investment growth in Brazil, and some notable VC deals in the Brazilian technology sector. These useful findings have been detailed below.
- As per data from LAVCA, the Association for Private Capital Investment in Latin America, the total VC investment into the Brazilian startups reached $1.3 billion in 2018, as compared to $859 million invested in 2017, and $279 million raised in 2016.
- The above represented a 52% spurt in 2018 from the 2017 VC investment levels and a 369% increase from the 2016 VC investments in Brazil.
- The 2018 VC investments in Brazil represented nearly 66% of the entire VC funds raised in Latin America as a whole in 2018 and made up 9 of the 14 top deals in all of Latin America.
- The total amount of PE & VC funds (combined) received by the Brazilian technology industry aggregated to R$1,591.3 million in 2014, R$556.1 million in 2015, R$680.7 million in 2016, R$647.3 million in 2017, and R$1,103.6 million in 2018. However, no bifurcation between the PE and VC funds was available for the sector.
- The total PE & VC funds received by the Brazilian technology industry represented 12%, 3%, 6%, 4%, and 8% of the total PE & VC investments made in Brazil in 2014, 2015, 2016, 2017, and 2018 respectively.
- The total number of PE & VC companies that participated in the Brazilian technology industry funding was 13, 41, 30, 49, and 49 in 2014, 2015, 2016, 2017, and 2018 respectively.
- The average ticket size of the PE & VC funding received by the Brazilian technology sector stood at R$122.4 million, R$13.6 million, R$22.7 million, R$13.2 million, and R$22.5 million in 2014, 2015, 2016, 2017, and 2018 respectively.
- Some notable high-value VC deals in the Brazilian tech industry included $400 million VC investment by Naspers and Innova Capital in Brazilian food order app, iFood, in November 2018, $300 million VC investment by VisionFund in Brazilian online platform for gym membership, Gympass, in June 2018, and $200 million VC investment by Softbank in Brazilian credit fintech, Creditas, in July 2018.
The research team began with searching for the required information in third party industry reports from KPMG, Deloitte, Bloomberg, Reuters, and Mckinsey among others. However, all the information found catered around the overall VC investments made in Brazil and Latin America and did not provide any information specific to the technology sector. The team then scoured through the various PE & VC databases such as Crunchbase as well as LATAM specific databases and associations such as LAVCA, Brazilian Private Equity and Venture Capital Association (ABVCAP), Apex Brazil, and In Brazil among others. The team came across a report from ABVCAP that provided the combined levels of PE and VC funding in the Brazilian technology sector over the years but did not bifurcate the two amounts, and hence, the exact level of VC funding for the sector could not be determined from the same.
The research team also tried to triangulate the information by using the overall VC investment made in Brazil over the years and the percentage of the VC investment that was made in the technology sector. This would have allowed the team to arrive at the dollar amount of investments in the Brazilian tech industry and thereby compute the YoY growth. While the team was able to locate the VC investments made in Brazil over the past 3-5 years, the percentage number available was again for the PE and VC funds combined. There was no data available to bifurcate the two. We could also not assume the same to be equally split between PE and VC because Brazil overall received way more PE funding as compared to VC funding, as per the ABVCAP report. Hence, the information could not be triangulated.