A new joint venture, Redpoint e.Ventures, announced over the summer that it had raised $130 million to invest in early stage Internet start-ups in Brazil.
It is the first such fund in Brazil originating from Silicon Valley, according to Endeavor, an American nonprofit group that promotes entrepreneurship in emerging markets, as reported by Bloomberg Tech in July. The firm's founders say it is also the largest early-stage venture capital fund in Brazil, according to a recent TechCrunch article.
Less than a year old, Redpoint e.Ventures was formed by two Silicon Valley venture capital firms, Redpoint Ventures and e.ventures, formerly BV Capital.
"Internet use is still growing, and so is the mobile Web, and Brazilians still face a large void in early-stage venture capital, presenting a major opportunity," said Redpoint's founding partner Jeff Brody, as quoted in the Bloomberg Tech article, Venture Capital Firm Makes Long-Term Bet on Brazil.
"The startup ecosystem in Brazil is really starting to boom right now, but it's in the early enough days for Redpoint e.ventures to see the potential for a huge upside, and also to help show some entrepreneurs for the first time how people do things in Silicon Valley," the TechCrunch article reported Brody and e.ventures co-founder Mathias Schilling as saying.
Although Brazil is the world's sixth largest economy, government bureaucracy, high taxes, sluggish growth and roughly a month of statutory vacation days a year make it an expensive place for start-ups. In September Brazil's government lowered its 2012 gross domestic product forecast to 2 percent, from 3 percent, but Finance Minister Guido Mantega also said GDP should grow 4 percent in 2013. Last year's GDP dropped dramatically to 2.7 percent from 7.5 in 2010.
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