The volume of investments in startups reached the value of R$ 50 billion in 2021 and has been doubling every year since 2016, according to data from innovation consultancy Distrito. As an active figure for this amount invested, there are more than 200 active investors in Brazil.
These investors can be individuals (angel investors), accelerators, government development programs, investor associations and venture capital funds. In all modalities, the clearest value proposition is smart-money, a common expression in the market to illustrate that the value goes far beyond just the capital contributed.
High-impact investors in the market will be recognized for the power of the connections they can make. As important as their role as mentors and advisors is, it is generally connections that can make the most difference to the day-to-day lives of invested startups.
The main forms of connection that an investor can promote for a startup are:
Access to talent
Throughout the startup’s journey, there will always be a need to hire and train the team. Investors have extensive contact with failed startups or future entrepreneurs, and can act as headhunters for key positions.
Market access
Commercial partnerships, presentation to new customers, business development, among other activities that arise with the aim of helping the startup grow. This is a great difference that investors can have in the day-to-day life of the startup to unlock important barriers in potential new businesses and opportunities.
Access to investors
Every 18 months, on average, a Brazilian startup will need to resort to a new round of investment. Investors have a relationship with other investors in the next stages and will certainly help in this preparation for a new round of funding.
In addition to these forms of connection, an investor will be able to share many practical lessons learned from other invested startups, which will certainly help you shorten paths and gain time to grow better and faster. The true smart-money of investors will be in their ability to promote these connections and share learning on a daily basis.
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