August 19, 2017
In partnership with BB Seguridade and Banco Votorantim, Microsoft is selecting FinTech and InsurTech startups in the post-acceleration stage for its Fundo BR Startups. The VC fund, managed by MSW Capital, will allocate R$ 500K to R$ 3 million per company with the intention of preparing the selected startups for growth within Brazil, and for them to advance to other countries, according to Franklin Luzes, COO of Microsoft Participações.
Find out what Franklin Luzes considers essential for a startup to go global in this exclusive interview:
What is Microsoft looking to develop with the startups selected by the fund?
Franklin Luzes: Microsoft wants to help strategic segments to develop via innovative companies. With Fundo BR Startups, we want to focus on four strategic concepts, which are the following areas of interest for our public:
These are the four areas we are developing. By securely exploring new trends, they make up our strategic vision.
Will Microsoft and partner companies (BB Seguridade and Banco Votorantim) participate in mentoring and developing the selected FinTechs?
FL: The companies will have access to Microsoft's technology. Our banks offer their workplace for startups to become familiar with installations. The executives are not only part of the selection process but also mentors for the startups. They help with familiarizing the startups with the segment in which they work.
The fund helps more in the operational part of things since companies have goals. We help with the business' plan, so they might grow and work in other countries. This is our goal: to look for Brazilian companies that can even work internationally.
In addition to having two partners and billing [annually, between R$ 120 thousand and R$ 10 million], what fundamental aspects must entrepreneurs or startup teams have?
FL: The first selection criterion is simple and easy: in addition to billing, having at least two partners – one having the role of CEO and the other a CTO. At least one should be fluent in English, because, like I said, we expect the company to be able to do business outside of Brazil.
In addition to these basic criteria, we look at people and entrepreneurs. We believe that the success of companies, in addition to the technology itself, is within the potential of an entrepreneur. Is he ready to receive feedback to change the product? Does he want to change the world and do something different? Leave a legacy? We want him to do everything right – pay taxes and everything the law requires. Is he ready to retain talent, giving shares or bonuses to key people in the business? Because this is the Silicon Valley model. There, everyone wins together.
So, the first thing we look at is the entrepreneur.
The second step is to look at the solution. Does the solution resolve a real problem? Are you resolving a problem? Today, customers are looking to reduce costs, looking for efficiency and scaled gains. Which of these attributes (or would it be all three) would you resolve with your solution? You must show that the solution brings value to customers.
And, the final aspect is leaving the customer satisfied. This will result in contact and recommendations. So, what we are looking at are the entrepreneur and the solution.
Any tips for those who will enroll their project with the fund?
FL: My tip is to follow these criteria, especially regarding the solution: if it is a real solution; if the customer is sufficiently satisfied to recommend it to someone else; and if the entrepreneur is truly ready to do something relevant. He/she must be very resilient, have a strong will, learn many things, and be open to great challenges and to receive feedback that might be negative.
He/she should know how to share the cake with everyone on the team. It might seem obvious, but when we actually observe startups, it isn't always so obvious. Generally, founders earn shares or bonuses and the others only earn a fixed salary. This is something that really gets our attention.
This content was published in partnership with StartSe, a leading Brazilian website about startups. The portal contains the StartSe Base, the largest database of startups in the country, with more than 5,000 registered companies.