Investing in Brazil : 5 Sectors to follow and invest in 2022 - Europartner

Brazilian companies raised R$596bn in domestic capital market in 2021, an all-time high

The Brazilian capital market had a landmark year. Companies in the country raised R$596 billion in 2021 considering equity, bonds and hybrid instruments, up 60% year over year and the highest amount since records began, said Anbima, the association of securities firms.

The companies also raised $24.8 billion abroad, down 4.7% year over year. Considering funds raised locally and abroad, Brazilian companies got R$734 billion.

In variable income, companies issued R$128.1 billion, which was not higher than the nominal result of 2010, of R$150.3 billion. However, the figure of 11 years ago includes a one-off move by oil giant Petrobras, which raised R$120.3 billion.

In fixed income and hybrid instruments, companies raised R$467.9 billion in 2021. This is another record. The bond market alone totaled R$253.4 billion, more than double that of 2020.

Embraer sells subsidiaries in Portugal to Aernnova Aerospace for $172m

Embraer unveiled on Wednesday that it has sold two subsidiaries in Portugal, Embraer Portugal Estruturas Metálicas (EEM) and Embraer Portugal Estruturas empósitos (EEC), to Spain’s Aernnova Aerospace for $172 million. Both companies supply components used in aircraft manufacture and, after the closing of the deal, scheduled for the first quarter, they will continue to supply parts to Embraer.

The sale is neutral for the company, says Citi. The bank questions whether the company has not created unnecessary complexity. Citi has a neutral recommendation for Embraer, with a $17.50 price target for American Depositary Receipts (ADRs) traded on the New York Stock Exchange (NYSE).

Via buys logistics startup CNT

Via, owner of Casas Bahia and Ponto, announced the acquisition of 100% of the capital stock of the logistics startup CNT, which specializes in complete offers for e-commerce operations, according to a statement to the market. The value of the transaction was not disclosed.

According to Via, the transaction value consists of a fixed and a variable portion, with the fixed portion implying a multiple of about 0.20 times the gross volume of goods (GMV) in 2021. The variable part is conditioned to the achievement of performance targets and the permanence of CNT’s main executives at the head of the business.

CNT is specialized in complete offers for e-commerce operations, multi marketplace and platforms in the “plug & play” model, and have been operating for 11 years in the provision of complete logistics services (fulfillment) and for four years in services in e-commerce (full commerce).

Source: Valor international

Airvantis Faz Parceria Com a JAXA Para o Comercialização do Uso do Módulo  Kibo da EEI

Airvants, a space logistics startup founded in 2013 by mechatronics and space engineer Lucas Fonseca, 37, is making history. This Tuesday it will transport the first four Covid-19 protein molecules into space in a rocket from Elon Musk’s SpaceX leaving Cape Canaveral, in the U.S.

Mr. Fonseca wants to put Brazil on the route of the “new space” economy. “There is a large market to be explored in space and Brazilian companies are still incipient in this process,” he said.

A mechatronics engineer who graduated from the University of São Paulo (USP), Mr. Fonseca specialized in space engineering in France, where he lived between 2009 and 2010. Then he was hired by the German space agency to work on the Rosetta mission, which sent a probe into space in 2014, considered one of the most ambitious projects of the European Space Agency (ESA).

Mr. Fonseca was the only Brazilian to participate in the Rosetta mission team, whose spacecraft of the same name was built to make the most detailed study of a comet – in this case, the 67P/Churyumov-Gerasimenko.

When he decided to return to Brazil, Mr. Fonseca created Airvants with own capital, around $100,000, but later received an investment of R$5 million from Brazilian businessman Martim Matos, a partner in GreenCare, which sells cannabis-based medicines.

Airvants has already done several satellite delivery jobs for the Brazilian government, but now it has a contract with the pharmaceutical company Cimed, which specializes in generic drugs. Cimed owns three of the four molecules being sent into space today, with the fourth molecule being financed by Mr. Fonseca himself.

Brazilian businessman João Adibe, the owner of Cimed, says the company is investing heavily in Research and Development (R&D). The group will invest R$300 million in the next few years, an amount that also includes spending on space projects. International pharmaceutical companies have used this technique for more than 20 years and allows them to explore microgravity conditions, seeking to obtain better quality protein crystals. “We want to establish ourselves as a health-tech company and we will fund this research in space,” he said.

Cimed has signed a partnership with the National Center for Research in Energy and Materials (CNPEM), an organization overseen by the Ministry of Science, Technology, and Innovations (MCTI), to make possible the experiment that consists in crystallizing proteins in space.

In this first project, the idea is to take the Covid-19 proteins to try and develop drugs to combat the disease. “We don’t want to make vaccines,” Mr. Adibe said. The first experiment takes off Tuesday and there are plans to send yeast vitamins into space between May and June.

Airvantis is in talks with other companies related to technology. Valor found out that it is in talks with the Asian technology company Asus to take the company’s materials into space. The goal is to evaluate the deterioration of equipment and carry out marketing campaigns. Asus did not return an interview request.

Marketing campaigns in space are another niche that Airvants is exploring, so much so that a sign with Cimed’s logo will be taken into space together with other global companies.

“The new space market can be explored by various sectors, from agriculture to mining,” Mr. Fonseca said. Brazilian artist Romero Britto consulted Airvants about taking canvases into space. It is a form of positive marketing that can be exploited in the “new space” economy. “Before, the space economy was tied to geopolitics between countries.”

Airvants has a holding company in the United States, which acts as a “venture builder,” which means that it seeks business opportunities for other startups and companies.

Source: Valor international

JetBov - Software de Gestão para Fazendas de Gado de Corte

Startup JetBov, which created a management platform for cattle ranching, intends to carry out a new round of investments in the coming months, in which it will seek resources for its expansion. Today, approximately 2,500 farms, with 5 million animals, are registered on the company’s management platform. In addition to Brazil, which concentrates the largest volume of customers, the agtech also operates in Angola, Bolivia, Mozambique and Paraguay.

JetBov’s wants to double its turnover in 2021, as it happened in the last three years, according to the CEO, Xisto Alves de Souza (the company did not disclose its revenue). The company’s growth rate is in line with an industry trend: the capture and interpretation of livestock data to increase production rates and ensure the sustainability of the business, the so-called ‘Livestock 4.0’. According to a study by the Centro de Inteligência da Carne Bovina (CiCarne), an intelligence center on beef cattle, at the sector dedicated to the subject at Brazilian Agricultural Research Corporation (Embrapa), if the level of management and technology in the segment does not change, more than half of the farmers in activity will leave the field by 2040 due to lack of profitability.

According to the Brazilian Institute of Geography and Statistics (IBGE), 1.5 million rural producers left the activity between 2006 and 2017, due to problems with profitability and low retention of young people. Cattle breeder Murilo Trindade, 32 years old, from Aquidauana (Mato Grosso do Sul), almost entered the IBGE statistics. The cattle breeding tradition, which began with his great-great-grandfather, at the time of the city’s foundation, became an unprofitable source of “savings” due to the management model. So much so that, on the advice of his own father, he decided to move to São Paulo, in 2004, to study.

However, in mid-2014, he began to realize how much money they were losing. The three family farms added up to 2,100 hectares, but they did not yield a beffiting profit. “If we sold everything and put the money in a savings account, the income would be higher”, he says. It was then that the producer began a movement of transformation, which would culminate in him leaving his profession as a civil engineer, in 2018, and returning to Mato Grosso do Sul.

With a lot of knowledge of project and people management, Mr. Trindade created a company, FitAgro, with shares divided between himself, his brother and his parents. “We started to do business management, with cash flow. We integrated the family and changed the mentality”, he says.

In November 2018, Mr. Trindade became a client of JetBov, which was born after business manager Xisto Alves de Souza realized the difficulty that cattle breeders in Lages (Santa Catarina), where relatives of his wife lived, had to collect and analyze data manually. In 2016, after talking to breeders around the country, he launched the company.

According to Mr. Trindade, the platform has been speeding up the work. Each animal has device in an earring read by an electronic stick that connects to the corral scales. It only takes one click for the data to be sent to the cloud, to be viewed by the producer, on a computer at the property’s headquarters. The facility gives the possibility of making decisions almost in real time.

Another platform functionality is the control of pastures. In it, the producer can design the area to be used by the cattle, enter information and understand the production capacity, according to JetBov marketing manager Thiago Bernardon. Mr. Trindade states that this is important because grass needs to be seen as a crop similar to corn and soybeans, which has a time to grow and be harvested, so as not to lose its nutritional value.

In three years, the new management model resulted in a 50% increase in the Trindade family herd, which reached 1,500 cattle, in addition to several investments in the structure of the farms.

For Livestock 4.0 to be implemented, producers will need resources. For this reason, the agtech recently announced a partnership with credit startup E-ctare, which will provide credit with better conditions for JetBov customers who, in addition to using the platform in property management, adopt best practices.

“Many times the cattle breeder wants to increase production in the same area, but doesn’t have the capital to buy cattle. So, this model allows producers who are more mature to have a competitive credit line”, he emphasizes. “It transforms cattle into financeable assets, digitally it becomes a Rural Producer Bill (CPR)”.

Source: Valor international

Privally, a startup specialized in security and privacy management with a focus on the General Data Protection Law, is the first acquisition of Tivit Ventures, an investment arm founded less than a week ago by Tivit, a Brazilian multinational of cloud computing services. The value of the deal was not revealed. Tivit’s new division counts on R$400 million until 2025 to acquire software as a service (SaaS) companies. The company says it plans to invest in ten companies by the end of 2021 with focus on cybersecurity startups, industry 4.0 and internet of things.

Source: Valor International

The private equity fund CVCIB Holdings will create a startup accelerator focused on agtechs, or agricultural technology firms. The hub is being installed within UISA’s industrial park (former Usinas Itamarati) in Nova Olímpia, Mato Grosso. The plan is to set up a new center for the promotion of technological innovations and business focused on the state’s interior. The new hub, T4Agro, will operate on three fronts. It will work as an incubator for incipient technology startups aimed at the sugar-and-ethanol sector and others, will be an accelerator of agtechs with more mature solutions and will develop innovations already in gestation within UISA.

Source: Valor International

Four months after announcing the creation of a fund to invest in startups, Minerva Foods closed the first deal. With an injection of $4 million, the Brazilian group became a minority shareholder of Clara Foods, a Silicon Valley foodtech that develops alternative proteins — free of animals — for use in the food industry. Founded by Mexican Arturo Elizondo, Clara Foods was born within IndieBio, the world’s largest biotechnology incubator. The startup has already raised more than $50 million through two rounds of investment. Minerva does not reveal the stake it bought. In an interview with Valor, Minerva CFO Edison Ticle says this will not be the company’s only investment. The venture capital fund has $30 million to inject in startups. He says the plan is to invest between $1 million and $15 million in up to 10 companies.

Source: Valor International

EmbraerX, the Brazilian aircraft manufacturer Embraer’s disruptive innovation arm, launched Thursday its first company, Eve Urban Air Mobility Solutions (Eve). The startup will focus on the development of products and services aimed at urban air mobility and hits the market at a time of investments and growing discussions about the development and use of “flying cars” in the coming years. One of the products in Eve’s portfolio is an electric vertical takeoff and landing vehicle (eVTOL). “The spin-off puts Eve in a good position to be one of the first in this market,” Daniel Moczydlower, Embraer’s vice president of innovation, told Valor.

Source: Valor International

Private Equity firm Warburg Pincus invested $100 million in Take Blip, a digital communications platform that provides companies with customer service chatbots and helplines, the Brazilian startup said. Some of its 750 current clients in Brazil include Itaú Unibanco, Coca-Cola, Claro and Fiat. The company hopes to use the additional resources to expand its reach internationally. Revenue this year should reach $40 million, according to Take Blip CEO Roberto Oliveira. Mr. Oliveira said the company will “probably” list shares sometime down the road, but the Warburg Pincus investment had a horizon of at least five years.

Source: Valor International

Quasar Flash, a startup that makes advances on receivables, closed a fundraising of R$25 million in a round led by the Valor Capital Group, from the US. The resources will help it to expand investments in people and technology. With customers ranging from individual microentrepreneurs to companies with annual earnings of R$20 million, Quasar Flash offers duplicates discount and plans to carry out credit operations with guarantee on credit card receivables starting in November – when the Central Bank (BC) rule on these assets. “We want to operate among the smallest companies, in the least-assisted group [in terms of offering credit],” says Carlos Maggioli, founding partner and president of fintech.

Source: Valor International

Acesso Digital, a Brazilian technology company focused on digital identification, received a contribution of R$580 million from funds led by General Atlantic and Softbank. The company will get almost all the investment and did not disclose the minority stake sold. The transaction valued the startup at more than R$1.2 billion. The talks for the injection were driven by the pandemic because of a higher interest in digital identification services for fraud prevention. Besides that, the company sees opportunities to set foot in sectors where it did not operate, such as health and education.

Source: Valor International