Pedro Nakachima

The collapse of PPPs in Brazil Since the country is volatile ( from a macroeconomic perspective), investors require a high IRR to put money in local projects (which is fair). However , something different is happening in the South American giant: - there is a burgeoning cottage industry of lawsuits requesting renegotiations of contracts whenever the concessionaire starts to lose money. There are two risks attached to this fleeting industry: 1- Firm bids low to win government contracts, and then go to court to “charge real tariff” to users and to the government 2- Firm has 10 contracts, for instance, and 5 do very well, and 5 do poorly. Instead of dealing this as part of doing business, it renegotiates the 5 poorly performing contracts, thus making all of its 10 contracts portfolio a guaranteed success. This is not proper business practice. These are not profits arising from risky private business putting their capital on the line! This is outright transfer of government funds to “guaranteed successful projects“. If investors want guaranteed returns, they should buy bonds, not invest in equities. Investors are supposed to be doing PPPs to put equity in the business, ( not debt) and therefore, there is a potential risk of losing part of returns, and even capital. Brazil needs to fix it in the courts, otherwise the whole PPP program may collapse when public opinion takes a hold of this issue. #brazil #ppps #collapse #courts #judicializationofcontracts

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Mercado Libre is a juggernaut - 25 years and still growing at 40%. The company literally changed my life and helped inspire the launch of EMQQ Global 10 years ago. Thanks Marcos Galperin! Also - Did you know that $MELI is NOT included in most of the #emergingmarkets #etfs from iShares or Vanguard (EEM, IEMG, VWO, etc.)? Neither is Nubank. You get 2x Petrobras and neither of the top #latinamerica internet companies. #internet #ecommercenews #brazil #nubank #mercadolibre #mercadolivre #frontiermarkets #mexico #colombia #argentina

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Brazilian digital bank PicPay collaborates with Citi for US IPO #PicPay, a Brazilian mobile banking app owned by J&F Investimentos S.A, is preparing for a potential #USIPO with #Citigroup, pending favorable market conditions. Initially aiming for an $8 billion valuation in 2021, the company withdrew its registration. In 2023, PicPay reported a net income of 37 million reais ($6.8 million), marking a significant recovery from a 693 million reais loss in 2022. With over 35 million active customers and approximately 70 million total users, PicPay continues to expand its footprint in the digital banking sector. For more insights, the Brazilian country profile is available in the members area (https://lnkd.in/d54iD7Um) for members. Non-members can download it for free here: https://lnkd.in/dQzexCQ5 #CInnovation #FintechInsights #FintechInnovation #FinanceInsights #BankingRevolution #DigitalTransformation #BankingInnovation #FinancialGrowth #Finance #Banking #NeoBanking #FinancialServices #Fintech #BankingNews #TechInFinance #FinancialNews

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🌟 Proud to share this comprehensive report on Investing in Minas Gerais (my state) from the Financial Times! 🚀 🔍 Key Insights: - Minas Gerais: Brazil's bellwether state, reflecting the nation's diverse political, economic, and social fabric. - Governor Romeu Zema: A potential dark horse in Brazil's next presidential race, navigating the delicate balance between business and politics. - Belo Horizonte: Embracing tech and quality of life initiatives to rejuvenate Brazil's first large planned city, confronting modern-day challenges head-on. - Brumadinho Dam Disaster: The 2019 tragedy continues to shape global mining industry standards, highlighting the importance of safety and transparency. - Lithium Potential: Minas Gerais emerges as a hotspot for lithium exploration, revitalizing regions once overlooked. - Niobium Niche: Delving into the energy sector, Brazilian niobium gains attention with implications for global markets. 📈 Don't miss this opportunity to gain insights into how Minas Gerais is driving Brazil's future! Dive deeper into the report here: #Investing #MinasGerais #Brazil #Economy #Insights 🇧🇷 https://lnkd.in/dGmJmUrr

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From our Monthly Tech Report (October 2024): ▶️ Global investors reinforcing Brazil tech thesis: - BOND makes its second Brazilian investment - SoftBank Investment Advisers returns to the market after a notable pause - Both participated in ASAAS' R$820 million Series C round ▶️ Secondary market gaining momentum: - Warburg Pincus LLC acquires minority stake in Contabilizei (R$700M) - Additional transactions detailed in the full report ▶️ Landmark strategic acquisition: - ClearSale acquired by Serasa Experian (R$2.0B) These deals reflect sustained institutional interest in Brazilian technology companies despite current market conditions. Stay connected with the latest market trends through our monthly report. 👉 Click here to read the full report: https://lnkd.in/d_JParge

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Nubank's Fintech revolution in Brazil Before Nubank entered the scene, the Brazilian banking sector was notorious for its bureaucracy, inefficiency, and high fees, creating a frustrating experience for consumers. Traditional banks, with their cumbersome processes and lack of innovation, failed to meet the evolving needs of a digitally savvy population. This was the world that Nubank sought to change. Founded in 2013 by Colombian entrepreneur David Vélez, Nubank began in a modest office in São Paulo. From the outset, Vélez was clear about his vision: to simplify banking for Brazilians using technology and design, and to deliver customer-centric financial services. This vision was ambitious, given the dominance and inertia of established banks. One of Nubank's first and most significant departures from the norm was its leadership hiring strategy. Rather than sourcing talent from within the banking industry, Vélez focused on individuals from diverse backgrounds, including tech and customer service, who shared an entrepreneurial spirit and were aligned with the vision of transforming banking. This approach brought fresh perspectives into Nubank and avoided the entrenched thinking that plagued traditional banks. To keep everyone aligned with its core mission, Nubank instituted weekly alignment meetings. These weren't just routine check-ins; they were dynamic sessions where team members from various levels were encouraged to voice opinions, challenge processes, and suggest innovations. This level of openness was rare in traditional banking environments, where decisions typically flowed top-down and employees rarely felt empowered to influence strategy. Moreover, Nubank’s competitors, burdened by legacy systems and hierarchical structures, struggled to adapt to the changing landscape. Their inability to quickly innovate or realign their operations meant they couldn't offer the same level of customer satisfaction or adapt to market changes as swiftly as Nubank. The tangible impact of Nubank's aligned and empowered team was evident in its product offerings, starting with the launch of a no-fee credit card managed entirely through a mobile app. This product was a game-changer in the Brazilian market, where high fees were the norm and digital solutions were nascent. The credit card was met with massive customer approval, and within three years, Nubank reached a million users, a feat that took traditional banks decades to achieve. Nubank's success story is a testament to the power of clarity of vision, the right team, and consistent alignment. By building a culture that valued innovation and customer feedback, Nubank not only transformed the banking experience for millions of Brazilians but also established a new benchmark for service in the financial industry. #StoriesOfAlignment

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Rates in Brazil. Higher, for longer… At the beginning of this year the outlook for interest rates in the US and in Brazil was quite optimistic. In the US the market was pricing up to seven reductions and in Brazil an overnight rate of 1 digit. We are approaching the end of the first semester and the expectations have changed somehow. In the US we may have 1 or 2 reductions, as the hiking possibility is off the table. In Brazil economists who participate in the Focus survey expect the Selic rate to end the year at 10%, up from 9.5% just 4 weeks ago. This is a direct result of a more resilient inflation, and in Brazil, the possible worsening due to the floods in Rio Grande do Sul, a key state from both agricultural and industrial sectors. GDP projections were also lowered. What caught the attention of the economic press is also the projection of interest rates and inflation for longer tenors, suggesting a real interest rates (above inflation) of 5.5%. A Valor Economico article says that “the market projects inflation of 3.5% for the period from 2026 to 2028. This means that the rate of 9% per year represents, in real terms, something close to 5.5% per year”. The longer dated bonds indexed to inflation are paying more than 6%! This is a continuation of what happens in Brazil for decades. Higher nominal and real interest rates to keep inflation under control, translating to higher costs of financing on one side and an inviting scenario for fixed income investments on the other. As long as there is trust in the creditworthiness of the country the carry trade (investor financing themselves in low yielding currencies to invest in higher ones) should continue. The consequence has been a strong currency. The Focus survey points to mild changes in the BRL forecast. And why real interest rates must be so high? Possible reasons are: a highly indebted government, a mediocre infrastructure (although improving) and a closed economy. History shows that sudden reductions in interest rates tend to backfire. If this is something troubling your business in Brazil let me know. Send a message to [email protected]   

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Choosing Your Investor: Best Insights 🧠 💡 Fabio Iunis de Paula (Indicator): "Research the fund as they research you. Ask for a reverse pitch before presenting your own." Ronaldo Barreto and Reinaldo Normand (Niu Ventures): "Your relationship with your investor is as important as with your co-founder." Sergio Angelini (MANGXO): "Choose investors you’d truly want to make rich." Carlos Castellanos, CFA (Samsung NEXT): "Money is becoming a commodity; VCs need to bring real value." Investors can make or break your company. Choose wisely.

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**Brazil's Industrial Price Trends: A Closer Look at the Producer Price Index (IPP)** As we navigate the complexities of the global economy, it is crucial to stay informed about the latest trends and indicators that shape the economic landscape of key countries, including Brazil. One such important metric is the Producer Price Index (IPP), recently released by the Brazilian Institute of Geography and Statistics (IBGE). ### Details on the Indicator In September 2024, the IPP indicated a 0.66% variation in industrial prices compared to August 2024. This marks the eighth consecutive positive result, highlighting a steady upward trend in producer prices. This increase is a significant indicator of the health and dynamics of Brazil's industrial sector. The IPP is a vital tool for economists, policymakers, and business leaders as it reflects the changes in prices of goods at the production level. An increase in the IPP can signal rising production costs, which may have cascading effects on consumer prices and overall economic activity. ### Implications and Considerations The continuous rise in the IPP over the past eight months suggests a robust industrial sector, but it also raises questions about the potential impact on inflation and consumer spending. As the economy continues to evolve, it is essential to monitor these trends closely. ### Reflecting on the Data Given the current trajectory of the IPP, it is worth pondering: What do these consistent increases in producer prices mean for the broader economic outlook of Brazil? How might this trend influence business strategies and investment decisions in the coming months? #perfeitoai #brazil #andreperfeito

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Brazil is the next frontier for international asset managers

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“Second” Solana ETF Approved in Brazil!! Brazilian Securities and Exchange Commission (CVM) has approved a “second” Solana ETF, per a CoinDesk report. The ETF product will be reportedly launched by a Brazil-based asset manager Hashdex in partnership with local investment bank BTG Pactual. This Solana ETF may be the 2nd of its kind in Brazil, after CVM approved the country's first Solana ETF on August 8, which was offered by a Brazil-based asset manager QR Asset. It is quite interesting to observe that in about two weeks’ time, two Solana ETFs have been approved in Brazil. What a speedy development! Is it a sign that Brazil may become the first runner jurisdiction to be open to more diversified crypto assets ETFs where ETFs on other crypto currencies and assets can be tried, while US and Hong Kong appear slowing down on other cryptocurrency ETFs after Bitcoin and Ethereum ETFs’ approvals? Read on more in the report. #cryptoETF #ETF #cryptocurrencyETF #BitcoinETF #EtherETF #Brazil #cryptoasset #cryptocurrency #DLT #Blockchain (Any contents shared are only for information sharing purposes and are not any investment or legal advice or do not intend to support any product, price, company, platform, information, opinion, etc.)

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I'm excited to share our latest research on the state of the Brazilian consumer, where we provide a comprehensive overview of the evolving behaviors and preferences of Brazilian consumers. The piece highlights key trends such as the rise of digital channels and the increasing demand for value-based products and services. As Brazil continues to navigate economic pressures and technological advancements, understanding these shifts is crucial for businesses looking to stay competitive and meet consumer needs effectively. I invite you to read the full article to gain deeper insights into this dynamic market and explore how these developments could impact your business strategies. Read the full article here: https://lnkd.in/dqG4rRjU

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Interesting paper on the next level of AI ethics. Heterogeneity problem and how could AI help alleviate the issues around informational and behavioral gaps to aid markets to deliver better. Actually, this is similar to 90s when we were discussing how internet would be solving the issue of information gaps and allow markets to function efficiently as per the premise of the (neoliberal) economic models. That failed to deliver and now the hope is AI will be able to address these gaps to enable markets to function efficiently which will benefit all, and not a certain group (human welfare), with help of regulation. Well, one can only hope.