How does Sand Hill Road understand Brazilian founders?

Bruno Yoshimura
Feb 19, 2019 · 7 min read

Last year, I organized a trip with MBA students and professors from Stanford to São Paulo and Florianopolis with the objective of studying the current state of the entrepreneurial ecosystem in Brazil. For the first time, this gave me the opportunity to analyze the characteristics of our successful entrepreneurs through the lenses of Sand Hill Road. Below, I outline what I learned:

1. Creativity is a key competitive advantage embedded in our culture
In Brazil, we have the phrase "jeitinho brasileiro", which can be translated as "the Brazilian way of doing things." Usually, it has a very negative connotation and is used when people break the rules to solve their own problems in an individualistic approach. In my view, the entrepreneurs have their own and positive "jeitinho brasileiro" to deal with the scarcity of resources and the bureaucracy. The best example of creativity that we learned was during our meeting with Ariel Lambrecht, founder of the unicorn 99. In the early days, he mentioned that they didn't have money to invest in marketing and so they had to find a way to grow without spending money. By having this budget constraint, they came up with a brilliant strategy: they would not charge taxi drivers for rides and would use them as a marketing platform instead. While other competitors were spending a lot of money on customer acquisition and charging the drivers, Ariel was asking the drivers that were also serving competitors, to convince their end clients to switch to 99 and save commissions. The more competitors were spending on marketing to attract end clients, the more 99 could grow with this strategy. Genius! If this company had access to cheap capital in the seed stage, would they have come up with this strategy?

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Ariel Lambrecht, founder of 99 and Yellow

2. Humility is a common characteristic among successful entrepreneurs
Humility is especially important at the beginning of a new ecosystem as most entrepreneurs are doing it for the first time and have more knowledge gaps than experienced entrepreneurs. This requires humility to be open to learning from mentors, investors, employees, and customers. A great example of humility is Monica Saccarelli, founder and CEO of Diin and previous founder of (Top 2 home-broker in Brazil, which was ultimately sold to XP Investimentos). She started with the dream of bringing people to the stock market and this market rapidly became very competitive, with new players lowering the prices and accepting paying very high acquisition costs for new clients. She went abroad to understand the new ways of doing marketing and learned at Harvard this new thing called "content marketing." By identifying a gap and being aware of its potential, she studied this new technique before everyone else was aware of it and implemented an acquisition machine with the best acquisition cost among competitors. This was key to Rico's success. In her next journey (Diin), she started by asking for external help in Silicon Valley to validate her company's product-market fit and invited some advisors to help her. Many successful entrepreneurs follow a different path after an important exit and often become arrogant. In the process, she did exactly the opposite by asking for help since day zero. This showcase how humble entrepreneurs are willing to learn and search actively for mentorship and knowledge.

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Monica Sacerelli, co-founder of (sold) and Diin

Entrepreneurship is a humbling experience. Most of the entrepreneurs we visited were extremely humble and this fact really surprised our group, especially the ones more familiar with the "ego" of Silicon Valley, or how entrepreneurs usually oversell themselves. Saying that all entrepreneurs in Brazil are humble would be a survivor bias. Instead, I believe that the likelihood of success in Brazil is higher if you are humble.

3. Transparency brings alignment in a culture averse to feedback

Transparency brings people together, especially in the dark periods of a startup journey. In the difficult periods for Ariel in 99 and Monica Saccarelli in Rico, they both were upfront about the challenges and budget constraints the companies were facing. This attitude created a strong bonding in the team, fuelling the community-based characteristic that is very different from more individualistic societies.

Additionally, transparency brings a better alignment of the priorities and the direction of a company. This is especially important in a society that is averse to giving direct feedback. Sometimes leaders fail to give constant and direct feedback to employees who are not totally aligned with the company's priorities, but by being transparent with regards to the current company "struggles", it may not be necessary.

Because Brazilians are averse to giving direct feedback, making sure there is a top-level alignment through a transparent culture is important.

4. Entrepreneurs are tackling an original solution to local problems

“It was interesting to see how many Brazilian startups provided original solutions to local problems, rather than simply importing business models.”, said Dana Foarta, a professor at Stanford who studies the regulatory environment.

David Velez saw an opportunity in Brazil after he had a terrible experience trying to open a bank account. He couldn’t even enter a branch of the bank easily, as the security doors are equipped with a very sensitive metal detector. By providing online signup with less friction, Nubank was able to adapt customer acquisition removing the friction of the signup process. In the US, this competitive advantage would be less relevant.

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David Velez, CEO of Nubank: "Before Nubank it was so hard to open a bank account in Brazil"

Stelleo Tolda, COO and co-founder of Mercadolivre, explained that it was necessary to build a payment platform (MercadoPago) and a logistics infrastructure (MercadoEnvios) to adopt eBay's business model into our reality. It is not enough to import a business idea from Silicon Valley without understanding the dynamics of the local market. Not only Mercadolivre adapted many things, but also exported innovation to Silicon Valley. Most people don't know that it was Mercadolivre who invented the button “Buy-it-now” when they were testing growth strategies in their auction system when they realized that the users didn't want to wait for the end of the auction.

5. A strong network of mentors is necessary

Mentorship is key for the development of our entrepreneurs and is a key advantage for community-oriented countries like Brazil. During this trip, Bruno Ghisi shared how important was the Endeavor’s mentors network was for Resultados Digitais. After the company’s success, they are now the ones giving back to the Florianopolis ecosystem. To succeed as a first-time founder, one has to be part of the network of successful entrepreneurs and investors. The way to build a strong network in Brazil is slightly differently from Silicon Valley: Real networking is made in a more social setting over a beer without a time to end.

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Resultados Digitais’ Office in Florianopolis, meeting with Bruno Ghisi, co-founder and CTO

Lindred Greer, an associate professor at Stanford whose research focuses on the dynamics of startup teams, concluded after the trip:

“I was humbled by the quality and importance of the social network there, including the commitment of the leaders there to develop the Brazilian eco-system and help aspiring founders, without often any direct payback for themselves. I was inspired by how many more Brazilian start-ups were tackling ‘real’ societal problems than what we see start-ups addressing in Silicon Valley”.

Most entrepreneurs in Brazil are on their first journey and hopefully, are already taking advantage of the community willing to help them. When I was young, I only became an entrepreneur because I had the luck to find more experienced mentors that helped me to realize that the website that I was doing for fun could actually become a business.

After many years as an entrepreneur building Kekanto and Delivery Direto, I started to help other people. As a natural path, I started angel investing with a group of friends and fell in love with supporting entrepreneurs. Our group made more than 70 investments in companies like Docket, Idwall, Gympass, Creditas, and QuintoAndar. Last year, we decided to start ONEVC — a Silicon Valley and Brazil-based seed-stage VC firm. Now, it is time to give back the help I received from my mentors to pass it on to the next generation of entrepreneurs that are coming.

Bruno Yoshimura is a co-founder and venture partner at ONEVC. Bruno has accumulated 15 years of experience as a tech founder with extensive involvement in product development, sales, and marketing. Before pursuing an MBA at Stanford, he launched Kekanto, an online guide based on users' reviews backed by Accel Partner and Kaszek Ventures, and Delivery Direto, a white-label platform for restaurants doing delivery. As an angel investor, Bruno has made five investments with a realized returns above 100x. Bruno also holds a major in computer science from the University of Sao Paulo.


ONEVC is a Silicon Valley and Brazil-based early stage…

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