Young, technology-intensive and fast-growing companies have not only been among the big bets for investors but also played an increasingly fundamental role by transforming traditional sectors and preparing them for the future. The so-called “Emergent Giants” show up with founders who create innovative businesses, products suited to market needs, traction and attraction of risky investments. That is why they are already born close to become giants.
Latin America is considered one of the most promising regions for the coming years. A recent report scanned the Brazilian market, revealing that 105 firms have this profile and are under investors’ radar. Together, they employ more than 15,000 people, and 40% have between 100 and 200 employees. Almost half of the founders have a postgraduate degree or had academic experience outside Brazil, and 47% have at least one founder who has undertaken a business before. The data are part of the Emerging Giants survey, produced by KPMG and Distrito.
On average, each startup with this profile received 2.4 investments and, since 2011, more than US$ 1.3 billion has already been invested in Emerging Giants operating in Brazil. The boom of these startups took place from 2012 to 2016, and, on average, they have been operating for seven years: 2000 to 2010 (16.2%), 2011 to 2015 (62.9%), and 2016 to 2018 (21%).
Of the total, Fintechs are the majority, representing 27.6% of the total number of companies with this profile. Adtechs (12.4%) are in second place, followed by Retailtechs (10.5%), Healthtechs (5.7%), Edtechs (5.7%) and HRtechs (4.8%). At the bottom of the list are Agtechs (2.9%), Insurtechs (1%), Govtechs (1%), Construtechs (1%) and Autotechs (1%).
The trend is for this market to gain even more breath. November 2021 was the highest month in terms of investments made in Brazilian startups in the semester, reaching US$ 809.9 million, according to data from Distrito. Last year, the total reached US$ 8.85 billion by the penultimate month of the year, triple the amount recorded in 2020.
Source: Emerging Giants