A mature investment market, increasingly digital and with broad potential for expansion makes Brazil "a very attractive magnet" for private capital, considers Bill Ford, CEO of the Global Fund General Atlantic (GA). "Despite being volatile in terms of currency and politics, Brazil is a country that has generated one of our best returns", he said during an interview at ABVCAP Experience.
Since 2007, when the fund entered the country, there has been investment in 19 companies and the exit of 10. Currently, it has participation in companies such as Pague Menos, Quinto Andar and Acesso Digital. In amount invested, it was US$ 2.6 billion, with returns of 40% in USD and 60% in BRL. "We have strong arguments to believe in the Private Equity and Venture Capital industry in Brazil," he argues.
One of the factors that reinforces Ford's optimism with the country is the accelerated digitalization of business. "Brazil is establishing itself in the digital economy, with a lot of entrepreneurship and companies emerging purely digital”, he says. Among the investments of GA in the country, there are four companies considered unicorns, i.e. valued at $ 1 billion before going public. "This proliferation generates more success stories”.
To enhance the maturation of the Brazilian investment market, Ford suggests a greater exchange between Brazilian business universities and universities with global projection, such as Stanford, Harvard and Insead. "One thing I would love to ask everyone is to partner with the good universities in Brazil, helping to create good programs to attract talent and break barriers," he says.
With a presence in 14 countries, including Brazil, GA accounts for US$ 40 billion under management and over 180 professionals specialized in various sectors. Ford joined the company in 2001 and since 2007, when he debuted in Brazil, he acts as CEO.
Challenges and alternatives
The complexity of the Brazilian tax system is one of the main obstacles to be faced, says Ford, to stimulate the flow of private capital to Brazil. "There are problems with policies that do not allow free entry and exit of capital. What I suggest to the government are policies more like those adopted in the international market".
In an environment of globalization of private equity and venture capital markets, Ford recommends that managers do not stand idly by waiting for answers from politicians. Instead, it suggests that local teams draw up strategies adapted to each country's reality.
"Each geography has its peculiarities. (...) There is no risk management from the top," he says. "It is necessary to build investments with local teams and strategies, which take into account the global platform of governance and innovation, and use it in their own way," he reinforces.
Another recommendation is to incorporate in the business a long-term vision, whenever an investor enters a new country or region.