Brazil has many low hanging innovation “fruit”; problems unique to Brazil with huge markets crying out for innovative solutions. However, there is 10% of the innovation in Brazil than there should be. Here are a few reasons why: Structural barriers to iteration: High barriers to opening AND closing businesses Complex and time-consuming tax and legal system (and high corruption) Underdeveloped seed and growth capital markets High cost of doing business as a startup compared to …
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8 legal reforms to improve the Brazilian startup scene
The legal system in Brazil is extremely complicated and tends hurts startups rather than nurturing them. There is much discussion in the startup community as to how to improve the competitiveness of new tech companies through reforms. Here are 8 reforms that could have a positive effect on the Brazilian startup scene: 1) The legal process to open a company should be integrated and streamlined so that opening a company takes less than 48 hours and …
Why most startups are “limitada” in Brazil
There are two types of legal structures for companies; (i) limitadas or LTDA, roughly analogous to a limited liability and (ii) sociedade anónima or SA, roughly analogous to a corporation. Most startups set themselves up as a LTDA so they can enter the “simples” tax regime with low tax brackets. Limitadas don’t have shares, they have quotas (similar idea, different name). You need to have at least two quotaholders but are not required to have …
Why its better to be hired PJ rather than CLT in Brazil
In order to be hired PJ, you need to charge through a company (your own or someone else’s). You still need a work visa just the same, however, I will assume you have the appropriate visa. Choosing CLT and PJ is a tradeoff but I’d say it’s usually better to be hired PJ. You get more net salary each month and you (and the company) pay less taxes overall. You might even be able to …
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