The next Google will come from Brazil

We talked to Robert Janssen, a senior advisor to Outsource Brazil about how Brazil and the US could improve relations from a technology standpoint.

IT Decisions asked Janssen, a well-known figure in the sourcing industry, if  the upcoming meeting between presidents Obama and Dilma would include any discussion of the IT sector in Brazil. “I doubt there will be any IT discussion, but I wish there were. The talks will circle around infrastructure, the FIFA World Cup, the Rio Olympics and the oil that Obama needs so badly now,” he said.

But when pressed on what he would really like to see discussed he talked about IT industry funding, Janssen highlighted the need to foster new companies in the technology sector.

“One thing the US could really collaborate on with Brazil is helping to fund startup companies. In the 1960s there was the SBIC in the USA – this created a private stimuli to small companies. It really kick-started started the entire company funding mechanism in the US.”

“In Brazil, we don’t really have a venture capital (VC) market and you only see mergers and acquisitions at the top level, nothing at the smaller company level,” he added.

Janssen believes that there is a new wave of innovation in Brazil just waiting to be tapped.

“Where are the good ideas coming from? They are coming the universities and so they need funding and management. Even the business incubators in Brazil are not business accelerators. They might give you an office and a bit of basic infrastructure, but they don’t help you with any company management,” he said.

“The US could really turbo-charge the Angel and VC funding layers in Brazil. The total number of IT-related companies in Brazil is over 60,000 – most of them small firms. They don’t have cash to grow and they don’t have the management experience.”

Janssen even suggested that the creation of a US-backed fund to help small, innovative Brazilian companies would play into the interests of the US – in addition to the companies getting funded.

“It would be valuable for the US to create this funding because they would then have first crack at working with and shaping the direction of these new companies. The new Googles of the world are not going to come from the US, they are going to come from Brazil,” Janssen said.

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IT Decisions says

Robert Janssen lives in both the US and Brazil. He sees the best and worst of both societies and his comments here indicate a pragmatic way for the US president to stimulate closer trade links with a neighbor and gain new innovation for his own economy in areas of specific interest, such as oil and gas.

Globalisation experts, such as Thomas Friedman, have already suggested that the next wave of university innovation in the US is going to come from foreign students studying in America. It’s the young Brazilian, Chinese, and Indian students that are going to be coming up with new ideas that become small new companies, but how do they grow beyond campus?

More importantly, how does a young Brazilian with a great idea develop that company in Brazil without funding? And how can Brazil tap into the expertise and ideas of the young who are studying in Brazil?

The government spends millions of dollars on trade missions and conferences aimed at promoting the Brazilian technology sector. Perhaps it is time to divert a few million from promotional activities to an idea such as this, just to see what great oaks can grow from small acorns.

Click here to listen to Robert Janssen talk about the Obama visit to Brazil

Click here to listen to Robert Janssen talk about a fund for Brazil

Click here to listen to Robert Janssen talk about who is already offering funds

Click here to listen to Robert Janssen talk about the new Google from Brazil

Photo of Robert Janssen by Mark Hillary