Business

For the first time, investments in emerging companies surpass those in established companies in Brazil

A study by KPMG and ABVCAP shows that, last year, 200 companies received BRL 14.6 billion from venture capital funds, while 55 raised BRL 9 billion from private equity managers

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  • Among the invested companies, 27% of the infusions went to 21 financial services companies;
  • Next come companies from technology and information (22%), retail (12%), and other areas;
  • In 2020, VC and PE funds divestments reached BRL 18.4 billion, a drop of 23% over 2019. The period was marked by a series of IPOs of companies invested by these funds, such as the fashion collaborative e-commerce platform Enjoei! and the online coupon and cash-back provider Méliuz.

A survey carried out by the consultancy KPMG and by the Brazilian Private Equity and Venture Capital Association (ABVCAP, in the acronym in Portuguese) shows that companies in Brazil received BRL 23.6 billion in investments from these funds in 2020 – the second-largest volume registered in the country since 2011 and only 7% below 2019. Even in a year marked by the uncertainties of the COVID-19 pandemic, the volume of investments in start-up and emerging companies (venture capital) exceeded, for the first time, the amount invested in more well-established companies (private equity): BRL 14.6 billion and BRL 9 billion, respectively.

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In total, 255 Brazilian companies received investments and reported how much they earned in the KPMG/ABVCAP survey. Of this total, 200 had contributions from VC funds and 55 from PE. In the fourth quarter of 2020, the average investment per company was BRL 67 million in VC and BRL 409 million in PE. The respective segments reached BRL 3.6 billion and BRL 2.9 billion in volume in the same period.

“Brazil is consolidating itself as a global center for innovation and entrepreneurship,” said Piero Minardi, president of ABVCAP, in a press release.

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Among the invested companies, 27% of the contributions went to 21 financial services companies. Following are the technology and information (22%), retail (12%), and others. In 2020, VC and PE funds divestments reached BRL 18.4 billion, a drop of 23% over 2019. The period was marked by a series of IPOs of companies invested by these funds, such as the fashion collaborative e-commerce platform Enjoei! and the online coupon and cash-back provider Méliuz

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