1Mby1M Virtual Accelerator Investor Forum: With Daniel Ibri of Mindset Ventures (Part 4)

Sramana Mitra: Are you looking for unicorn-style investments or are you also interested in the smaller niche plays that are going to have smaller exits. Let’s say $50 million to $100 million exits.

Daniel Ibri: We are interested in the smaller ones. I honestly believe that’s a very smart niche to be at this time.

Sramana Mitra: I do too.

Daniel Ibri: That’s one of the advantages to have a smaller fund. That’s one of the things I like about not having a $300 million fund where I really need to have a unicorn on the portfolio to pay back the fund. If you have a smaller fund and you do M&As and smaller exits, you can provide a good return to your LPs.

Sramana Mitra: That’s correct. That’s a very interesting observation. I’ve talked to numerous investors and some don’t want to do that. Increasingly, the smaller funds are starting to come around to the mentality that doing smaller, capital-efficient businesses that will get acquired for smaller exits is a perfectly reasonable way for venture funds to operate.

Daniel Ibri: I totally agree, especially for a newcomer.

Sramana Mitra: What do you have to say about the Brazilian market in terms of things for entrepreneurs to keep in mind if they want to come to Brazil as a market coming from US or Israel.

Or maybe in due course, coming from anywhere. We have a global footprint. We see companies everywhere in the world. If a company wants to come into Brazil, what should they keep in mind?

Daniel Ibri: It’s a very big country in economic terms, it’s not only about the 200 plus million people that live here. The opportunity is also very great. We are fast adopters. We like technology a lot.

One of the top three or top five consumers apps in the world like Facebook, Whatsapp, Uber is really doing well. The opportunity is great. Secondly, they should bear in mind some things that are peculiar to our way of doing things.

First of all, everything takes time. One of our founders from the US was here three months ago. We took them to some meetings. It was great. Then he was trying to follow-up. He was complaining to me saying, “I went to the meetings. The meetings were great. Now, I’m trying to follow-up and they don’t even open my email.”

It really takes time. It’s a culture thing. You need to come here. You need to cultivate relationships. Relationships are very important to us. Sometimes it’s not about what you’re selling, but about who you’re selling to. You have to find common links and common relationships. That’s one very important insight.

The second one that I can say is things are bureaucratic. If you’re setting up shop or renting an apartment or hiring people, these are not easy things to do, especially if you come from the US. You need to know the right person. You need to find the right lawyers.

We always joke that Brazil is not for beginners. You cannot just take a plane and try to do business. That may not work. It’s a long process. However, you will find that you can really be successful because the opportunity is great.

This segment is part 4 in the series : 1Mby1M Virtual Accelerator Investor Forum: With Daniel Ibri of Mindset Ventures
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