Beside an artificial lake in southeast Brazil stands a bluetiled modernist church, one ofOscar Niemeyer’s early masterpieces for which Pampulha is famous. This year thearchitect’s 1940s blueprint for Brasília became a Unesco World Heritage Site. But thissuburb of Belo Horizonte (“Beautiful Horizon”), the state capital of Minas Gerais, is alsoa burgeoning hub of the technology revolution sweeping this mountainous mining stateof red roofs and red earth.
Just south of Pampulha’s landscaped lagoon is BH.Tec, a fivestorey science park, whosecafeteria juts into tropical woodland. The 19 tenant companies include global leaders inbiotech, and the oldest, Ecovec, is expanding. Cecilia MarquesToledo, a molecularbiologist, shows me around labs where the Zika virus can be diagnosed in mosquitoes.The brainchild of professor Álvaro Eiras, the patented technology uses MosquiTraps andGPS surveillance to prevent dengue and Zika outbreaks.
The tech park, inaugurated in 2012 on the campus of the Federal University of MinasGerais, is part of a drive to bring worldclass Brazilian innovators, state government and
business together. Just up the road is the Mineirão stadium, rebuilt for the 2014 WorldCup but known around the country for a notorious match that ended in a rout. “We don’twant to be the place where Brazil lost 71 to Germany,” Leonardo Dias, Minas Gerais’sdynamic undersecretary for technology and innovation, tells me with a persuasive smile.Dias, 47, an electrical engineering graduate and events entrepreneur, meets me in thecentre of town in the elegant café of Espaço CentoeQuatro, a textile factory turnedcultural centre with a new coworking space that opened this year. “We want to beknown as the capital of innovation in Brazil,” he says.
With 5,000 tech companies, second only to São Paulo, Minas Gerais has fast emerged asone of the best startup centres in Latin America. Its growth is bucking Brazil’s worstrecession in two decades. During the Rio Olympics, in Britishbacked internationalStartup Games, a nonprofit competition, Minas Gerais startups won gold, silver andbronze. Those clustered in the capital (pronounced Bellow Rizonchi) were dubbed “SanPedro Valley” after the affluent São Pedro district where many were born. More than 300are now spread around the city. Its developers are one reason, in a state with four of
Brazil’s top 10 universities. Google opened its first R&D centre in Latin America in Belo10 years ago, after buying Akwan, a mining software company with a brilliant searchalgorithm. A “garden city” of fountained squares, Belo also has a lower cost of living thanSão Paulo or Rio, less traffic and a relaxed street life as Brazil’s “bar capital”. An hour’sdrive away are the botanical pleasure gardens and 23 contemporary art pavilions ofInstituto Inhotim, founded 10 years ago by the mining tycoon Bernardo Paz.
Government has followed entrepreneurs’ lead. “We have the thirdlargest GDP of anyBrazilian state, but if you take out mining and coffee, it’s 22nd,” Dias says. “Thedependency is very high, so our strategy is to invest to change that.” Other goals are tostem a brain drain and attract foreign companies and investors. Startups andEntrepreneurial Ecosystem Development (Seed), “the only public acceleratorprogramme in Brazil”, began in 2013 to give equityfree funds and mentoring toBrazilian and foreign startups selected in open competition. It has restarted after ahiatus that followed a change of governor in January 2015.
For Dias, “the economic crisis is the best moment to change the culture. We’reconnecting the problems of industry with startups that can solve them.” Among Seed’snew intake of 40 is Residuall, which, by tracking waste smartly, is green and saves fines.Cora, one of myriad learning platforms plugging gaps in education, was cofounded by aformer school principal, Cecília Passagli, 32. Her innovative ideas were rebuffed by atextbook publisher, “so I decided to do it myself”.
Growth can be spectacular. Lucas Borges, 29, cofounder of Risü, a platform to donate tosocial causes while shopping online, says revenue has grown almost 1,350 per cent thisyear.
“Brazilians don’t trust the government or the police because of corruption, especially ifyou’re not rich,” Priscila Gama, 33, says. “So we think, can society do it?” The daughter ofa car mechanic and a nurse, Gama was a practising architect until recession haltedconstruction. Hearing of a rape by a taxi driver, she cofounded Malalai, to “usetechnology to make women feel safe in the streets”. Named after Malala Yousafzai, thePakistani Nobel peace laureate, Malalai deploys camouflaged wearables and virtualcompanions: “We believe women can do great things if they feel safe to go wherever theywant.”
There are also nascent efforts to connect the ecosystem to some of Belo’s 215 favelas, likethose sprawled on the ring road, where “internet access is still a problem”, João Souza,36, says. He and Tatiana Silva, 30, are cofounders of Fa.Vela, a group of educatedvolunteers (some, like them, from favela backgrounds) who mentor microbusinesses.The group won Seed backing this year.
The Zika crisis is a factor behind Ecovec’s steepgrowth. Its M.I.Dengue system has been in usefor more than 10 years in 80 Brazilian cities andabroad. “We’re the unique company in theworld doing largescale mosquito surveillance,”says cofounder Eiras, 55. He did a PhD at
Southampton in England in mosquito behaviour “to know the enemy”. But it was his sonTiago’s dengue haemorrhagic fever in 2000 that drove him to find a solution, and abusiness partner. “I have just one son and I almost lost him,” Eiras says. Ecovec usestraps positioned by GPS to predict outbreaks so health authorities can target vectorcontrol. One 2013 study in Minas Gerais estimated that 27,000 cases of dengue had beenprevented, at a cost of $1 per inhabitant per year.
When Eiras invented his first trap there were restrictions on profiting from publiclyfunded research. But new federal innovation laws since 2004 have spurred researchersto “take technology from university into society. Now everyone’s launching a company,”he says. Of his 13 patents, eight are licensed. He now wants investment for Ecovec todevelop internationally beyond 16 employees. The difficulty in diagnosing Zika inhumans makes prevention paramount: “We’re wasting time.”
A new contract with Espírito Santo state willextend surveillance to 65 more cities than the 12monitored at present. Yet why is this lifesavingtechnology not more widespread in Brazil’smore than 5,000 municipalities? “Our contractsare with government health departments,” hesays carefully. “When a politician comes in, they
might change things for political reasons. They have other priorities than public health.”
“We don’t bother with patents,” says Pedro Filizzola, 28, marketing head of SambaTech,an early startup beacon. “We just keep innovating.” With 120 employees, and offices inBogotá in Colombia and Seattle in the US, SambaTech recently moved from BH.Tec toplush headquarters in a hillside suburb.
With a wall of awards from the Massachusetts Institute of Technology in the US andMicrosoft, the paleyellow beanbags and matching pool table nod to Silicon Valley. Athis sales office in São Paulo, the founding chief executive, Gustavo Caetano, 35, tells mehe was videogames columnist for a local newspaper at the age of 12. He started his firstcompany in his early 20s in frustration that he could download only 10 video games onhis Nokia mobile. Spotting a gap, he found a British aggregator with 2,000 games hecould supply to Brazilian telecom companies. Later, he moved to online video streamingfor Latin American TV corporations and digital platforms for advertising and education.
We’re connecting the problems ofindustry start-upsLeonardo Dias
Innovators have been spurred totake technology from universityinto society
“We try to solve very specific problems for one industry and to be first in every marketwe enter.” Last summer, SambaTech launched KAST in the US, “the first corporateSnapchat”, a secure internal communications app for the instant video age.
Caetano, who in 2011 founded the Brazilian Startups Association, believes “federalgovernment is not helping at all. Labour laws are from the industrial era. Entrepreneurssell and don’t want to start another company; they buy farms instead.”
Luiz Tângari, 41, an electrical engineering graduate, had farmers’ rising costs in mindwhen he cofounded Strider in 2013, which expanded this year into a tower block inSavassi, next to São Pedro. Toy tractors beside the coffee bar signal the business. “Iwanted a product you could sell in Brazil, the US and elsewhere, with real innovationfrom the south.”
For an annual fee, Strider’s robust green tablet converts data on pests into colourcoded“heat maps” that can indicate where and when to spray or harvest. “Farmers can start
When Roberta Vasconcellos, 28, left SambaTech to start a company with her brotherPedro, her exboss was a mentor. Their business networking app, BeerOrCoffee, wongold in the Rio Startup Games. It has partner cafés and bars across Brazil and isexpanding internationally. The aim is to connect people to others nearby with usefulskills. “We engineer serendipity,” says Vasconcellos, for whom San Pedro Valley’ssupport network is key to the strides its entrepreneurs have made.
