Starting a business in Brazil is hard work.  The ideal place to create a web startup is somewhere like Silicon Valley; a tightly knitted ecosystem with plenty of smart people and a pay-it-forward culture. In addition, cost and access to good professional services are also important to consider.

The ecosystem in São Paulo is bigger; there are more internet companies, startups and startup events in São Paulo than any other city. This makes knowledge sharing and business development cheaper and easier, especially given that the “short flight” from Rio to São Paulo can easily cost you R$200-600 a trip depending on notice.

The standard of professional services is much higher in São Paulo, as is access to top talent. Rio de Janeiro comes up short in both these categories and its not easy to find a decent lawyer or accountant, or a manager that speaks English.

Its hard to say whether Rio or São Paulo is more expensive since the price of commercial space in Rio is currently astronomical. The market for programmers is slightly better in São Paulo, although in general, salaries are higher in São Paulo.

On the other hand, traffic in São Paulo is worse than Rio which makes meetings difficult, however, the commute would be the same at midnight when you leave the office of your startup. ;)

Therefore, if you can bear living in São Paulo, it’s probably better for a startup. However, if, like me, you hate the São Paulo traffic, come to Rio where I have built my startups.