Sergio Pessoa has big plans for San Francisco. The man tasked with opening and running APEX-Brasil’s newest US office, wants to put Brazilian small and midsize businesses right in front of Silicon Valley’s venture capitalists. This is an important move by Brazil to push its tech firms out of the domestic market where they have traditionally concentrated, and into the international space.
We chatted with Pessoa in his first week on the job (he left his high profile position as international marketing director at Brasscom in December) to find out what his objectives are for the Bay Area, the type of company he’s looking to support, and the challenges he expects in the initial years.
Speaking to us from his new office, which is still being set up, Pessoa sounded excited to begin work. Pessoa is transitioning into the role of general manager for the San Francisco office of APEX-Brasil, the Brazilian investment promo agency. Pessoa’s mission is simple: to support the internationalization of Brazilian companies.
Taking Brazil Global
“Brazil has not been a strong exporter of its companies,” said Pessoa. “The huge domestic market means many firms don’t look outside. They’re used to being close to their clients.” It is this inward-focused mindset that will be the biggest challenge for the APEX team in San Francisco. The result of the US and European markets being hit hard by the recession is that very few Brazilian companies felt the need to leave home to seek their fortune.
“In the past, I’ve worked closely with Indian and Chinese firms. With them, there’s much more a culture of internationalization and export,” said Pessoa. “70% of the IT market value in India is from exports, whereas in Brazil it’s less than 5%.”
But he also gives examples of Brazilian firms that are bucking the trend. “TOTVS, Stefanini and Ci&T are just some of the companies expanding their presence internationally. This is the model we want to see smaller Brazilian firms follow.” TOTVS, the largest enterprise software company in Latin America, made headlines last year when it opened a new R&D center in Silicon Valley.
Why San Francisco?
To encourage Brazilian firms to internationalize, you have to provide a better alternative than the strong domestic market that keeps them comfortable at home. Thus, APEX’s choice of San Francisco. “There’s a very strong perspective here on tech, innovation and venture capital,” said Pessoa. “All of that opens the door for smaller Brazilian companies, and especially startup firms from the Startups Brasil program.”
APEX-Brasil already has an office in Miami, but the move into the Bay Area is specifically to get tech firms close to investors and resources in Silicon Valley. The organization has traditionally provided companies with market intelligence and new opportunities, but Pessoa’s goal here is also increased business exposure. “I want to help smaller and midsize firms understand the value of product and services differentiation in the US market,” he says.
The team in San Francisco has been setting up the office for the past few months. By the end of this first quarter, they aim to be operational. Moving into Q2 and the second half of this year, Pessoa wants to be able to fully support Brazilian companies in their internationalization strategies. His office is currently being sustained through shared services with the Miami office.
IT and Beyond
Moving out of a solely IT-focused role in BRASSCOM, Pessoa is now responsible for many different export sectors. But he intends to continue emphasizing technology as one of the largest drivers of growth for Brazilian firms. Through the San Francisco office, he will diversify Brazil’s offering – not just IT, but also higher end exports like biotech, cleantech and renewable energies.
That’s a lofty ambition. And it will be challenging, both in terms of enticing those firms over from Brazil, and also for Pessoa himself, who has limited experience in these industries. He’s getting started early however, already having set up a meeting with several clean-tech firms in his first week.
A Personal Transition
“This is really a new opportunity for me to bring my global experience with multinational firms, to now help smaller and midsize firms find a space in Silicon Valley. It will be a huge learning experience,” said Pessoa. Having moved three times in the past two years, he’s looking forward to settling for a while in the Bay Area with his (very understanding) wife and young daughter.
The strategic plan for APEX-Brasil in San Francisco is currently until 2016.