The chain of business investments is present in the most diverse sectors. Whether in a digital, face-to-face or hybrid business, the development of the economy and of aspects that surround the capital market are always present. Today, the discussion is increasingly common in people’s lives and many Brazilians are already starting to take their first steps towards becoming investors.
Brazil has stood out in investments made by individuals. The number of investors on the Stock Exchange grew 43% in the last year, reaching almost 4 million people, according to data released by B3, one of the main financial market infrastructure companies in the world. Investors are also allocating capital at increasingly younger ages – most are between 25 and 39 years old – and are investing smaller sums.
“I believe we are at the beginning of the path towards becoming investors. If you look at the number of people who put money towards capital investment in relation to the total population, it is about 2%”, comments Tiago Reis, Founder and CEO of Suno Research, a financial analysis consultancy focused on individual investors.
Investment prospects in Brazil
Traditionally, Brazilians are not used to saving money from a young age, but this has changed considerably. With the increase in financial education, people are discussing the importance of having a good management of personal finances for children, young people and even adults, and are also having better knowledge of, and easier access to the best channels to invest or save money.
In Brazil there is also a strong culture of deriving income from real estate. Due to the country’s history of hyperinflation, this became one of the most traditional and safest ways of investing for many to invest money. However, the trend is for the flow of capital towards assets to begin to develop further, as more people become financially aware of opportunities.
In addition, for those who want to start in the capital market and achieve good results, it is necessary to think in the long term and not make strategic decisions based solely on the present and, investing in stocks with capital you won’t need for the next five years or longer is important in this process.
The prospects for investment management in Brazil are positive and we find a favorable environment for innovation and for relevant segments in the economy. “It is an irreversible trend and we will only see more investors in the coming years”, concludes Reis.
Entrepreneurship, a partner in the capital market
Opportunities in Brazil have been increasing in recent years and have also brought about changes in the national economic outlook. The ease of starting a business is one of them. Digital entrepreneurship has become one of the factors that has kept the optimism in the country and attracted the attention of younger demographics.
Part of this trend is connected to the cost of opening a business. Depending on the business model, the need for a large amount of capital is no longer paramount. Now, a good idea, a good execution, and little (well applied) capital can be enough to invest in starting your own company.
Besides, nowadays, the entrepreneur has more tools to evolve and learn. The internet and the wide range of information available contribute on a daily basis towards equipping the entrepreneur with the necessary tools. The high visibility of digital companies and the increase in the number of Small and Medium Businesses are sign of this evolution.
“I’m very optimistic about entrepreneurship in Brazil and Latin America, because I think we’ve never had so much access to capital and, nowadays, good entrepreneurs are a scarce. We will continually see a shift of power going to the entrepreneur, who will choose the investors they want, and not the other way around”, says Reis.
Another reason that contributes to the growth of entrepreneurship in Brazil is the behavior of society regarding starting a business or pursuing a professional career, which has also been gradually changing. Before, positions that offered stability and security, such as jobs in the public service, were highly sought after. Today, part of the population has other goals.
The ideal job has become one that offers more freedom, practicality and power of choice. In this way, the desire of becoming entrepreneurs and ensuring the continuation of their businesses successfully has become a priority for many Brazilians.
“My dream is for us to have an active capital market that is able finance Brazilian entrepreneurs who want to expand their businesses. A strong country is made with a strong capital market”, adds Reis.
Want to know more about it?
Listen to the podcast episode “Questions that move us”, with Tiago Reis.