The turn for Brazilian IT companies to march upstream?
Most of the discussions around the potential of Latin America are related to how insurers can take advantage of a relative immature market, with a growing young population and increasing wealth and investment. The other side of the coin is how vendors can take advantage of a more attractive market as insurers interests grow in the region. You might not all be aware that there was a booth in the exhibit hall at recent Acord Loma trade show showcasing some Brazilian IT companies such as i4PRO which is starting its internationalization program, others such as Stefanini which already has presence beyond Brazil and other that are just in the initial phase of feasibility analysis for their internationalization programs. The offering of the Brazilian IT companies is based on a large and developed internal market that stimulates the generation of creative solutions and a talented human capital pool, that will enable them to compete in more mature and larger marketplaces. In this initiative they have the support of SOFTEX. Founded in 1996, it is the Association for the Promotion of Brazilian Software Excellence, which is priority program from Brazil´s Ministry of Science, Technology and Innovation (MCTI). The focus of this program is the development of markets and the sustainable expansion of the competitiveness in the Brazilian Industry of Software and IT Services. This program has a nationwide scope and comprises SOFTEX itself coordinating a broad network of Regional Agents with around 2,000 software and IT services companies. These companies receive support through a series of initiatives conceived and executed by SOFTEX. Among these actions and projects deserve special mentioning: PSI-SW (Exports); MPS.BR (Best Practices); PROSOFT (Funding); PAEMPE (Best Practices) and Observatório SOFTEX (Qualified Information). Brazilian companies have another vital aid when aiming for internationalization: The Brazilian Development Bank (BNDES) which has played a fundamental role in stimulating the expansion of industry and infrastructure in the country. The BNDES also finances the expansion of national companies far beyond the borders of the country and seeks to diversify the sources of its resources on the international market. These market development initiatives, that receive full attention from the government, are one of the reasons why Brazil is a leading case in the Latin American region not only as a receptor of foreign investment but also as a serious player in the global marketplace as they enable local companies to compete worldwide. While it will take some time until these companies can pose a serious risk to established North American players I would keep a close eye on them, especially considering the successful cases of Brazilian players in other industries that have gone the path of internationalization under similar programs.