Narayan AmmachchiChinese search engine giant Baidu has agreed to pour US$60 million into Brazilian venture capital fund Easterly Ventures, which funds technology start-ups in exchange for an ownership stake.
Easterly Ventures will inject this money into 15 Brazilian startups over the next five years, with the first investment slated for late 2016. The fund says it will support startups with a combination of capital, technology, traffic, and experience necessary to penetrate national and international markets.
This is Baidu’s first investment in funds in Brazil, where it has been operating for more than two years. It seems Baidu wants to use the fund as a platform to develop relations with Brazilian businesses, because it says it would support start-ups with technology in addition to helping them access the Chinese market.
“We strongly believe that Easterly Ventures will be a winner in Brazil’s talent-rich market, applying knowledge from China to build out the mobile ecosystem here,” said Yan Di, Baidu’s general manager in Brazil.
Aware that Google dominates the search engine market in Latin America, Baidu uses some specific products to attract consumers rather than rolling out a generic, across-the-board service offering. In Brazil, it appears to be focusing on building a mobile ecosystem and selling O2O (online-to-offline) products.
Baidu arrived in Brazil in 2014, setting up an office in Sao Paulo. The same year, it acquired the country’s e-commerce site Peixe Urbano. Baidu claims it expanded Peixe’s market share from 30% to 70% in a space of just one year.
Soon after its arrival, Baidu founded Brazil’s first business community for online-to-offline (O2O) companies. Its country manager Yan Di is currently the president for this online community.
There are no studies about how successful Baidu has been in Brazil, but the company claims 27 million Brazilians are using its mobile apps, and every day its mobile advertising platform ‘DU Ad’ receives over 150 million ad requests.
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