Brazil’s 2020 Economic Growth Beats Predictions, while the Country’s VC and M&A Activity Continues to Boom
Loggi, a Brazilian delivery startup, raised a $205M funding round led by CapSur Capital. Brazil's Totvs announced their purchase of tech company Consinco to strengthen retail operations. The Fast Company’s list of the 10 most innovative Latin American companies in 2021 showcases the energy and dynamism of a regional economy.
Brazilian Delivery Startup Loggi Raises $205M Funding Round
Loggi is a last-mile logistics company that operates a delivery dashboard to help companies optimize their delivery management and efficiency. The startup experienced huge demand during the global pandemic and has more than tripled deliveries in the last two years.
LatAm List reports that Loggi marks Verde Asset Management’s first non-publicly traded company investment, showing a new interest from local asset managers to make private-equity bets.
“We’ve been in touch with Verde for years and their track record speaks for itself. They’ll help prepare Loggi for its next steps. Going public is one of the options ahead,” said Thibaud Lecuyer, Loggi CFO.
The company plans to use the funding to expand its network of logistics centers and invest in the platform’s technology. This is the largest funding round so far for the startup, and the company now values close to $2B.
Brazil’s GDP Drops 4.1% in 2020, Beating Gloomier Outlooks
Last year, Brazil’s economy shrank by 4.1% amid the pandemic, but not as much as originally expected due to cash transfers to the poor. While the decline was the worst in decades, it beat forecasts from the World Bank and International Monetary Fund, which estimated that Brazil’s 2020 GDP would shrink by 8 percent and 9.1%, respectively.
Brazil, Latin America’s largest economy, grew by 3.2% in the fourth quarter of 2020, according to official statistics agency IBGE, more than the 2.8% median estimate in a Reuters poll of economists.
“People expected us to fall 10 percent [...] What made the economy move, in part, was the emergency aid,” said President Jair Bolsonaro, who has played down the gravity of the pandemic and opposed lockdowns.
Aljazeera reports that among the gloomiest forecasts at the onset of the pandemic, the World Bank and International Monetary Fund estimated that Brazil’s 2020 GDP would shrink by 8% and 9.1%, respectively.
“We had a big fall [in activity] last year, but with the emergency aid, it was much smaller than originally predicted. It could have been much worse … but the public finances are now very fragile,” said Alexandre Almeida, economist at CM Capital in São Paulo.
The government’s cash transfers to millions of poor families last year totalled some 322 billion reais ($56.5bn), a fiscal boost of approximately 4.5% of GDP.
Brazil's Totvs Buys Tech Company Consinco to Strengthen Retail Operations
Brazilian software company Totvs SA announced its subsidiary Soluções em Software e Serviços TTS has agreed to acquire technology firm Consinco SA for 197 million reais ($48.71 million USD).
In a securities filing, Totvs noted that an additional payment of up to 55 million reais will be made to Consinco if goals set for 2020 and 2021 are met.
Consinco, which provides management systems to supermarkets and cash & carry chains across Brazil and employs 400 people, has reported gross revenue of approximately 72 million reais in 2019, according to Totvs.
“With this move, Totvs increases its presence in the retail segment and consolidates its leadership in supermarkets, allowing synergies to be created with Consinco,” the software company said in the filing.
Reuters reports that the transaction follows other acquisitions made by Totvs earlier this year. Back in October, the company bought a credit card manager supplier for 455 million reais to strengthen its fintech division.
The 10 Most Innovative Latin American Companies of 2021
Companies from Colombia, Chile, Brazil, and Mexico led the innovation charge in 2020. From fintech to food, sneakers to solar energy, veggie burgers to video games, The Fast Company’s list of the 10 most innovative Latin American companies in 2021 showcases the energy and dynamism of a regional economy meeting today’s needs of increasingly engaged and tech-savvy consumers.
Bringing plant-based milk and meat to the masses
Digitizing farm-to-table food sourcing
Making popular sneakers from bamboo and sugarcane
Helping small businesses bank up
Capturing super-green solar energy virtually anywhere
Teaching professional skills through a pandemic
Bringing fast food into the 21st century
Promoting progressive values in a resistant market
Helping small businesses get paid through a pandemic
Providing addictive distraction when most needed