Angel investors speak to entrepreneurs at BR New Tech

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Have you ever wondered why Silicon Valley is so successful in creating innovative technologies? Bedy Yang, Flávio Pripas,IN Hsieh and Marco Fishbennot only have realized what the reasons are, they decided to create a similar community inBrazil building an intellectual bridge with the most prominent American technology hub. The idea is to facilitate the connection between entrepreneurs, investors, venture capitalists, journalists, and other important players in the development of startups, both from Silicon Valley and Brazil, with events and conferences. Besides accelerating innovation, by creating a sense of community successful entrepreneurs will feel compelled to give back by helping newcomers with connections, experience and financial resources, which is one of the reasons why the valley has been successful, called culture of reinvestment.

BR New Tech is a monthly event that brings this concept to life. I attended the last edition on March 31st and saw a group of 200 people completely immersed in the prospect of innovating and becoming high impact entrepreneurs, looking for the tools and connections to raise their projects to the next level, and that could range from finding an idea to work on to finding an investor to speed things up. The event was focused on the latter, with a Q&A panel consisting of four Brazilian angel investors: Pierre Schurmann, from Bossa Nova, Cassio Spina, from São Paulo Angels, Antonio Botelho, from Gávea Angels, and Marcelo Amorim, from Jacard Investments.

While the application and selection method may vary from one to another, they are all looking for startups to invest this year, with funding values ranging from R$150k to R$1,5 million, besides their extensive experience and connections acquired as former entrepreneurs. Most of them have a broad spectrum of segments they are interested in investing and capable to contribute, but consumer web startups are probably the most attractive.

When asked whether an entrepreneur should have a business plan or a business model, the consensus was that finding a viable business model is far more important, since a business plan is “old by the time it leaves the printer”, as Antonio Botelho said. In the angel investors’ opinion, business plans should be used as a tool to thoroughly think about the implications of implementing the startup and as a north to guide the enterprise, but it doesn’t necessarily have to be a part of the pitch to investors. However, they agree that few are the entrepreneurs willing to spend time on business plans, which sometimes leads to startups with unclear objectives and unreasonable funding requests.

 

Another interesting question made to the investors was about the stage that an idea should be to receive funding. None of them have restrictions regarding the stage the idea is at, it can be pre-revenue or already running offices in different countries, it all depends on the entrepreneur and the type of help he needs to continue to grow.

After answering the questions, the angel investors watched pitches from three startups: Enterplay, a Video On Demand company similar to Netflix; Spice Bazaar, a real time restaurant reservation system; and Zuggi, a search engine developed for children.

Prior to the Q&A panel, Bedy Yang talked to I/O ventures founders Paul Bragiel and Ashwin Navin directly from Silicon Valley, via Skype. It was a brief conversation with some interruptions due to the skype connection, but the message definitely came across: I/O ventures has a great program for early stage startups, they want entrepreneurs with the ability to execute, people that can create something “out of thin air”, quoting Bragiel. Paul and Ashwin have been to Brazil last year and were impressed at how companies here are able to succeed with so few resources and so many adversities.

The gap between Brazilian entrepreneurs and the resources to make their startups and their dreams come true is getting smaller. Initiatives like BR New Tech are helping the country to develop an innovation structure to support a new generation of entrepreneurs. Brazil’s own Silicon Valley is on the rise.