Fostering Entrepreneurship: Creating a Startup in Brazil

     As I pause to reflect in order to write this post, I am faced with the fact that I will be heading back home to Chicago two weeks from this Saturday. It´s hard to believe that these last few months have gone by as fast as they have and that I only have three more weeks and two more full weekends here. Although from the beginning my mindset has always been to enjoy each and every moment and experience as many things as possible, I have obviously begun to think about how to take advantage of each and every day I have left in this wonderful country.

     Two weeks ago, I participated in a Startup Weekend event located in Curitiba. Startup Weekend is a non-for-profit that was formed in Boulder, Colorado by Andrew Hyde in 2007. Startup Weekend was initially created as an event where a group of individuals would brainstorm a single business idea and work to bring that business to fruition over the course of the weekend. The event has since grown increasingly global and as of this year, Startup Weekend has hosted events in over 300 cities and 100 countries. These events have helped create over 5,000 startup companies all over the world.[i] This, in part, has led companies like Microsoft, Google, and Amazon to sponsor the event and offer every participant signifcant discounts on their products targeted toward startups. The conference was located at SENAI, a fitting location given the fact that SENAI is self-described as an incubator of innovation and entrepreneurship.

     The first day of the conference commenced with a series of lectures given by two general partners of venture capital firms located in Sao Paulo and Rio de Janeiro, respectively. After the lectures, there was a short pause in order to give the entrepreneurs, developers and designers an opportunity to meet and share ideas. The night was capped with an opportunity for each and every entrepreneur to give a one minute pitch about their proposed idea for a startup. Afterwards, everyone was allowed to vote for the three ideas they thought were most viable. As the night concluded, 11 teams were formed and the competition was set to begin. I joined in with a team that was centered on an idea for an e-commerce business that centered on fashion, an idea that was admittedly vague but showed legitimate promise if developed correctly.

     On Saturday, everyone gathered at 8 a.m. to begin working on developing their ideas in order to make a final presentation on Sunday evening. The final presentation would ultimately decide who would receive initial investments from local angel investors and consulting services from local technology accelerators.[ii] One of the first things my team did was decide what role each member of our team would play in terms of fostering the development of our idea. My team included two web developers, two web designers, two marketers and myself. Given my background in finance and economics, I played the role of economist and business strategist. Furthermore, I also assisted our marketing department by researching socioeconomic demographics and narrowing down our target niche market.

     Throughout the day, we bounced ideas off of each other and finally narrowed down our idea and target market. We decided to name our company Armario de Macho, which in English translates to something like ´a macho man´s closet.´ The e-commerce site functions as a service for college-educated men between the ages of 25-40 who know they need to continually update their wardrobe but don´t like going out to shop. The site, in theory, will function as a personal stylist for each user and will pick out clothes according to the preferred style of each individual, whether that be for business, leisure, or going out. Each client will develop their own personal profile which will include brands and recent style trends. Furthermore, each user will be shown a series of photos upon logging in that mimics a ´hot or not´ feature that will further help customize each client´s experience. In addition, we will incorporate customized and variable payment and shipping plans to meet the needs of each individual, given budgetary constraints and needs.

     Each individual will subscribe and pay each month, but can choose to receive packages every 1, 3 or 6 months. We will have incentives built in to buy more, i.e. free shipping and quarterly discounts. As we further develop our client base, we will look to develop relationships with local brands in Brazil that want to grow but haven’t found the right avenue to do so. It will be a win-win in that our company will receive a percentage of the sale of each product from these local brands (as we are helping promote and market their brand) and the local brands will gain additional exposure which will undoubtedly open up new markets and opportunities. As we continue to grow, we will look to continue to diversify our revenue streams as much as possible.

     My team worked extremely hard throughout the weekend. We worked together for 15 hours on Saturday, from 8 a.m. until 11 o´clock at night and for 9 hours, from 8 a.m. until 5 o´clock in the afternoon on Sunday. Throughout the weekend, we developed our website´s landing page (http://armariodemacho.com.br/), completed our business plan and developed our marketing strategy. Upon conclusion of the final presentations, my team was awarded 2nd place. Our price included an initial investment of 6,000 reais (approximately $3,000) and offers from local technology accelerators to help further cultivate our idea, company and brand. Among the myriad of experiences I have had in Brazil, I can now add being a silent partner and an economic consultant to an e-commerce startup. Not a bad result given the fact that I was participating in my first startup conference in my third language. In addition to working individually with my team, I got to meet a multitude of major players in the private equity and venture capital world in Brazil. It served to be an invaluable learning experience for me and will surely be a story I will tell for the rest of my life.

     This Thursday, I am heading to Iguazu Falls with two of my fellow colleagues from TORO Investimentos and two of my fellow students from George Mason. Iguazu Falls sits on the border of Paraguay, Argentina and Brazil so I will be able to experience three countries in one weekend. In addition to experiencing one of the seven natural wonders of the world, I will be able to experience the first ever X Games event in Brazil. For my final blog post, I will discuss my experience in Iguazu Falls and will elaborate on my final reflections about my four months in Brazil.

Chao for now,

Peter

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[i] http://en.wikipedia.org/wiki/Startup_Weekend

[ii] An angel investor is an individual who provides capital for a startup, usually in exchange for convertible debt or ownership equity. An accelerator is a type of consulting firm that helps newly formed companies in their early stage development initiatives, e.g. developing a brand and marketing strategy.