By Vincent Bevins

The force with which Silicon Valley’s presence is now being felt in Brazil, and so quickly, raises the question: what took them so long? Despite a fast-growing, tech-hungry population and top-rate programmers and engineers, a year or two ago it was nearly impossible to get access to venture capital or angel investment. Indeed, it was very difficult to get any kind of growth capital at all, and the outlook for entrepreneurs and start-ups, unless they were already cash- rich, was bleak.
But this is changing quickly. At the end of 2010, investors from Europe, California and the rest of the US began to show interest in investing in a few tech firms, some of which were new, and some of which had been going it alone financially for some time. Now, just months later, many venture capitalists are setting up local offices, hiring Brazilians and working to adapt as quickly as possible to the local environment.

It’s not hard to see why. The now-famous Brazilian economic boom is powered largely by a huge, newly empowered consumer base, whose 200 million members are gobbling up digital products and especially fond of online social interaction.

“Internet penetration is growing, broadband penetration is growing very fast, and e-commerce is growing at a rate of 20%- 40% a year,” says Marcelo Sales, one of the entrepreneurs who founded Movile, the mobile phone app success story, and recently left an administrative role to become an angel investor. “Five years ago it was pretty hard to have access to money at all. There were a few angels, but they really were angels – sent from God. It was very difficult to have access to capital in Brazil.”

Though Brazil has been growing steadily for years now, cultural and macroeconomic factors have worked against the small-time entrepreneur. Brazil has some of the highest interest rates in the world – a relic from the age of hyperinflation – a risk-averse population and extremely underdeveloped local corporate debt capital markets. A smart programmer who gave up a secure job at a big company to go it alone was considered extremely brave, if not a little foolish.

But as the rich countries plunged into deep economic crisis in 2008, and Brazil plugged along relatively unscathed, a flood of international interest, not to mention capital, has descended on the country, opening up previously undreamed-of opportunities. When Silicon Valley – broadly defined – woke up to the opportunities here, they found themselves scrambling to cover all available ground.
“The market opportunity is even more attractive than the US, because there´s so much room to grow,” says Angelina Clarke, an American who recently left her position as consultant at McKinsey in São Paulo to make her way in Brazil’s growing entrepreneurial scene.”The $15bn Brazilian e-commerce market in 2010 was bigger than the $12bn Australian market and the $7bn Indian market, [is growing by 35% a year], and if you look around, very few companies are moving fast enough to truly take advantage of it.”

There has been a flurry of activity, though. Movile recently acquired two companies in deals to the tune of $12m-$20m; a Groupon spin-off, Peixe Urbano, attracted a lot of attention and the competition of Groupon’s actual local subsidiary, ClubeUrbano; BuscaPé, a shopping comparison site, is gathering steam; and credit-check software developer Crivo is changing the way Brazilians use banks. Some of the deals are secret, but a number of well-known VCs are arriving and ready to put down money. The catalyst for much of this interest was Brazil’s successful bid for the Olympics, to be held in Rio de Janeiro in 2016, and plans to host the World Cup in 2014, says Bedy Yang, who founded Brazil Innovators, a Silicon Valley-Brazil entrepreneurial development network.

“But apart from the Olympics and the World Cup, there’s a lot of well-placed optimism around the economy itself,” she says. “The middle class is growing, 30 million people have moved from real poverty to the middle class. And Brazilians are very active in social media. They’re early adapters, for sure”

This is more than just healthy optimism. Brazilians demonstrably love social media. They have one of the highest Twitter usage rates in the world. There are more mobile phone accounts than people, and these are increasingly attached to smartphones. And the population has been migrating quickly to Facebook from Orkut, the Google-run favourite of yesteryear.

“If you take the average number of hours that Brazilians spend on social networks, it’s far above the international average, and I don’t know why,” says Sales. “Maybe it’s the social culture. But there is a huge growth of digital goods and everything is coming together to make a good combination.”

The Brazilian entrepreneurial scene has shadowed the upheavals in California. There was a small bit of activity at the beginning of the turn of the century, but the bursting of that bubble left things deflated for almost a decade. “As we know, Silicon Valley has its own cycles and bubbles,” Yang says. “In 1999-2000 there were a few start-ups in Brazil, some of which still exist today. The founders of BuscaPé came from universities at that time and said, ‘Hey, we want to create technology and be entrepreneurs,’ but from 2001 to the end of 2010, there was very little movement. The Brazilian economy was doing pretty well, and if you went to a good school, you just took a good job at a tech company or a bank.”

Despite the better financial prospects for start-ups, there is still not a strong tradition of entrepreneurship, and failure is often looked down upon. Meanwhile the economic boom is pulling bright young graduates in the opposite direction, as there is a shortage of qualified employees across various sectors, especially in technology and engineering. A bright student is likely to be offered a good, stable job, with high pay (São Paulo currently has the highest executive remuneration in the world), and good prospects for advancement. Why throw that aside for something that might go up in flames?

“In Brazil, we tend to take the view that everything is going to go tits up eventually, so if someone tells us in advance that there is a chance it will, we’re positive it has no hope,” says 29-year-old worker Luisa, who was recently approached by international investors with a sizeable headhunting fee to recruit some of her colleagues to a new enterprise with a huge potential upside. She was able to offer them double what they were currently making, but came back empty-handed.

“Everyone was either quite content with where they are now, or extremely wary of a couple of gringos with too much money and not enough reassuring guarantees,” she says. “They tended to assume [the investors] would throw this failed project on their CV and take off back to Europe.” This initially left the investors flabbergasted, but they are now trying to establish local roots and partnerships.
“One thing that I think is really important is that for the first time, the already existing generation of entrepreneurs, that understand digital markets and digital companies, are now becoming angels and investors,” says Sales, noting they have the experience to create a second generation. “ In the US you have a lot of examples like that, but in Brazil, this is just the beginning. The founders of MercadoLibre [South America’s answer to eBay, with roots in Argentina] and BuscaPé are becoming investors, and I myself am now an angel.”

Daniel Turini, founder of Crivo – which rode out the last decade with no outside funding – says he has seen the approach of foreign investors change radically since his company was one of the first approached last year. “Not only are they much more interested, many have bought companies or opened offices here and have hired some of the brightest Brazilians to help them understand our business culture and laws,” he says. “They know a lot more than they did just a few months ago.”
Another surprise for foreigners has been the complexity of tax codes, bureaucracy and business laws. In a culture where most things are relaxed on a personal level, new arrivals are taken aback to find how seriously one must take an arcane set of codes. It’s often impossible to navigate them without experienced local talent.

“I have been warned on countless occasions of the complexities of doing business in Brazil,” says Ofer Baharav, a Silicon Valley emerging-markets entrepreneur and CEO of start-up VideoVivo. He rattles off a list of the areas he was cautioned about, including major bureaucratic ineffi ciencies, a complex tax system, cultural misunderstandings, a style of doing business that differs markedly from the US’s, an aversion to risk, lack of understanding of the early-stage investment cycle and the absence of a viable investment ecosystem. “Sadly,” he says, “these premonitions have been proven to be right on the mark across the board.”

He thinks the opportunities offered by Brazil outweigh the headaches, however, and cites “a core of intellectual elites” who “understand the concepts prevalent in Silicon Valley well, and have a great respect for Silicon Valley and the US at large. Brazilians love to socialise in business, which can make the process more personal and exciting than in the US.

“I continue to be fascinated with Brazil and push through because I believe in the long- term potential this market has to offer,” he adds “and many of the more difficult aspects are likely to show improvements as this market matures.”

Arun Mathew at Silicon Valley’s Accel Partners, one of the bigger names to be establishing a presence in Brazil, expects to see quick developments on the cultural front. “The entrepreneurial scene is still nascent,” he says. “It’s very early in the life cycle of the career entrepreneur. People are moving to that world. The computer- science programmes at USP and Campinas [two universities in the state of São Paulo] are some of the best in the world. But at the moment a lot of the graduates are going to large corporations.”

Small, innovative firms are especially well- placed to turn revenue in Brazil compared with other emerging markets, he adds, because of the high penetration of credit cards, making online transactions easier. “In Brazil there are opportunities for all types of start-ups, from financial services to consumer internet, and including adaptations of a lot of consumer businesses based here in the US. It’s not just foreigners but Brazilians adapting successful US models.”

Accel recently made a sizeable investment in a Brazilian start-up, but Mathew can’t reveal details at the moment.

“There are two types of start-up activity going on at the moment,” notes Brazil Innovators’ Yang. “There are big investors who like to create local copycats of businesses that were successful elsewhere. AirBnB [a US website that connects budget travellers to people with a bed to rent out] is one example. Take that, and target it to 200 million people in Brazil.

“We believe that is just the low-hanging fruit. There is another, deeper space to create really new products here,” she adds. “There’s a lot more capital than there was before – we just need entrepreneurs to show that they will face the risk.”

The Tech Triangle
An insight into the battle for Brazil’s up-and-coming digital playground can be found on the Wikipedia page for “Brazilian Silicon Valley”, where self-interested parties vie to prove that theirs is the true Silicon Valley of Brazil.

But, does Brazil have an area akin to California’s crescent of technology? Well, yes, but not for exactly the same reasons. Almost all cross-border start-up activity has its locus within the triangle extending from the financial capital, São Paulo, to Campinas (a small city in the same state which is a player because of its university’s excellent computer-science programme) and Rio de Janeiro. While this is quite a bit bigger than the equivalent in California, it is still a very small fraction of Brazil. There is better technology infrastructure here than the rest of the country, but not the heavy-duty stuff of the southern San Francisco Bay.

Campinas, because of its size, is most likely to develop an identity uniquely tied to technology, but shouldn’t ever feel a need to break off from the financial behemoth just to the southeast. Most deals will end up being signed in the offices of São Paulo, probably with alumni of Campinas punching above their weight on the tech side, and some of the flashier businesses close to the beaches of Rio.

source: http://www.cnbcmagazine.com/story/brazilicon-valley/1465/1/

Some examples:

- Charging
- Endomarketing
- Political SMS
- Mobile Marketing
- Quiz
- surveys
- Confirmation of Events
- General alerts
- Adds
- and much more

Available for Claro Clients only (Brazil).

Available for Claro Clients only (Brazil).

Available for Vivo Clients only (Brazil).

Available only in Brazil.

We have been waiting most of the year to hear news from Facebook about an HTML5-based Web app store that would circumvent the native application ecosystems of the Android Market and the Apple App Store. Yet, according to Facebook’s CTO, there is not going to be a central repository of HTML5 Web apps coming to the platform any time soon.
In the meantime, a Brazilian company called Movile has launched a new version of its Web app store, Zeewe 2.0, which incorporates some key HTML5 features and could provide a roadmap for U.S. developers, like Facebook, in creation of a Web app store.

Offline Caching

One of the features of HTML5 is the ability to use offline caching to create Web apps that work when you do not have an Internet connection. This is essentially what Movile has done with Zeewe 2.0. The app store will function just fine, even if your smartphone is in airplane mode.
Offline caching means that Web app downloads up to 10-times faster than the original version of the store. We have seen various U.S. developers, like Amazon and Mozilla, start implementing offline caching in their apps. The browser does not need to go back to the server for data retrieval. Currently, four main Movile partners have games that will function with the data caching aspect as well: Block Dream, Blast Effect, Checklist and Card Flip.
The faster an app store is, the more likely that users will click through to buy and app. Once a user has an app, Movile hopes that they will then use their new payments API to push users towards in-app purchases.

Carrier Billing Partnership With Zong

Movile has teamed with Zong, a payments solution that was bought by eBay to bolster PayPal earlier this year. Zong specializes in carrier billing and will be available in the United States and Brazil to start but Canada, Mexico, most of western Europe and India are planned in the next few months. U.S. users have a distinct distaste for carrier billing but remember that Movile is a Brazilian company and worldwide attitudes towards carrier billing are not so harsh as they are stateside.
Movile has created a roadmap that a company like Facebook should take note of. HTML5-based applications tied through carrier billing and the mobile browser. It is about as easy a formula to follow for a consumer than almost anything else in the mobile realm.
Movile head of innovation Eduardo Lins Henrique told ReadWriteWeb that almost 60% of the apps available through Zeewe are from game developers. That would mesh with what we have seen from domestic developers – the gamers are on the forefront of the HTML5 push. Henrique also said that there is an adult content section to the Zeewe store, something that most U.S. HTML5 developers will probably shy away from. Yet, do not discount the ability of the massive adult content ecosystem to push the envelope of HTML5 development.
Does Movile have the right model? How long before something similar comes from a prominent developer in the United States? Let us know in the comments.

Fonte: www.readwriteweb.com/archives/zeewe_20_the_road_map_for_html5-based_web_app_stor.php

What do you think developers need the most? According to the Brazilian entrepreneur Bob Wollheim, the answer is simple: “business capabilities.” It’s from this belief that his latest initiative was born. Appies, as it is called, is an accelerator of a new kind; instead of boosting startups, it focuses on app developers. So what is it about and why are apps a growing trend in Brazil?

From Hackathon to Appies

It was during a mini-Hackathon in Sao Paulo that the idea for Appies sparked in Bob’s mind. He and the angel investor Pierre Schürmann had already been talking about launching a new venture together for a few months. Indeed, the pair had partnered on an incubator called Ideia.com in 2000, and the recent boom of accelerators in Brazil got them thinking. They wanted to be part of it, but how?
While observing developers at the Hackathon he was co-organizing a few months ago, Bob had a eureka moment. He realized there was no lack of good ideas nor of development resources. By pairing them with business knowledge, it was possible to make a huge difference, Bob thought. He decided his next venture would be dedicated to adding these skills to app developers’. Five minutes later, Pierre was already on board, Bob remembers with a smile.

What is Appies?

Appies’ selling line for developers? “Run the business while they’re busy developing great apps and APIs.” Indeed, not every one of them want to start their own business or knows how to, Appies’ introduction video points out. What Bob wants is to address this latent demand. Based on its experience and contact book, he’s confident that Appies can help developers improve their business skills and increase their income in exchange for a revenue share. Yet, it doesn’t call itself an accelerator, mainly because it works with individuals, rather than startups. However, developers may incorporate their ventures further down the line if necessary.
Appies will be initially based in Sao Paulo, where it will provide a co-working space for its developers. Different types of events will also take place in its offices, from small networking gatherings to training sessions. It will also host larger events such as Hackathons, Dev Days and an “Annual App/API Event.”

From a soft launch to global expansion?

Although Appies has officially launched already, its site informs that “it has only started operations in a soft mode. The full-time operations will only start on February 2nd 2012.” Bob acknowledges that Appies was conceived as a structure that won’t require much initial investment – both in terms of capital and of time.
Indeed, Bob is the CEO of the Brazilian digital media and event company SixPix. A busy job as you can imagine, albeit a bit less since a recent strategic partnership with the Brazilian media group Grupo RBS. For the time being, Bob plans to dedicate half of his time to SixPix and half to Appies – and the fact that both will be based in the same building will definitely help. As for Pierre, though he’s a quite hands-on investor, he won’t have any formal operational role at Appies.
Yet, it doesn’t mean that Appies has no ambitions – on the contrary. “As a digital platform, it has a global potential,” Bob thinks. He doesn’t rule out future conversations with investors, nor the possibility to launch operations in other locations. As for partnerships, Appies has already confirmed names such as Telefonica, the operator Vivo and the affiliate program Lomadee. Still, Bob makes it clear that Appies won’t focus on acquiring clients on behalf of the developers it partners with. It’s not a content producer, nor does it want to become one. However, Bob doesn’t seem worried about demand: in Brazil too, brands and corporations are increasingly awakening to what he likes to call “the Geek Economy.”

Why apps matter

What more and more players are starting to notice is that mobile represents a tremendous opportunity in Brazil. Indeed, the market goes well beyond the smartphone-owning elite, as millions of Brazilians own more affordable feature phones, but nonetheless Internet-connected (see our previous story.) According to recent figures released by the national telecom agency Anatel, there are currently 224 million cell phones in Brazil, while the country ‘only’ counts 190 million inhabitants.
With that data in hand, it becomes obvious how much Appies’ focus on apps makes sense. So does its multi-platform approach and its plans to partner with several different online app stores, as iOS is only one system among others in the local market. In fact, Bob even has a feeling that Brazil may “take shortcuts” again and adopt HTML5 faster than other territories, just as it adopted mobile phones without having fully developed landlines yet.
Eduardo Lins Henrique couldn’t agree more. He’s the Head of Innovations at Movile, the Brazilian company we recently highlighted as one of the ‘Ten Latin American Startups You Should Watch Out For.’ Movile is the force behind Zeewe, an HTML5 app store which “has more than 1.5 million users worldwide,” according to the company. Today, it launched Zeewe 2.0, a new version of the store which is heavily using cache features for the site to load faster. According to Dario Sciacca, CEO of the Italian development house DS Effects, which has many apps on Zeewe, “the user experience is much better.”
Although Appies and Zeewe are not in business together yet, both Eduardo and Bob agree on HTML5′s huge potential, which is only starting to show. According to Eduardo, it’s particularly true in emerging markets – he’s convinced countries like Brazil will soon be flooded with inexpensive Android-based feature phones, as well as low-cost tablets (albeit in a lesser measure.)

Beyond Brazil

Despite seeing market opportunities in Brazil, Zeewe’s vision, like Appies’, goes well beyond its home country. Indeed, the billing APIs it announced today alongside its new version will initially be available in the U.S. only, though Latin America and Europe will soon follow. If the U.S. is the first country where Zeewe will roll out carrier billing, using PayPal’s service Zong, it’s not a coincidence: 80% of Zeewe’s users are based in the U.S. and Europe, according to Eduardo.
In other words, Zeewe is a global venture as much as a Brazilian one – and Appies could very well follow its path in the near future. For now, Bob Wollheim already has an imminent international event in his schedule: the first San Francisco edition of the “online culture festival” he organizes, youPIX, which will take place on October 24th.
What about you, would you bet on the app market?

Fonte: thenextweb.com/la/2011/09/27/could-app-developers-have-their-accelerator-appies-says-yes/

In 7 months, Zeewe has reached 1 million users around the world!
Zeewe is simple to use:
• Browse to Zeewe.com and discover tons of free apps
• Click on an app that sounds interesting and see ratings and comments from other users.
• Download apps in seconds.
• Share apps with friends and invite them to play games with you.

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