Brazil is hot, hot, hot – and Wharton entrepreneurs are taking notice. Among the growing herd of Whartonites who find themselves dancing the startup samba in Sao Paulo, Brazil, is California-bred Jacob Rosenbloom (WG ’11). Jake is founder and CEO of Emprego Ligado, an SMS-based job marketplace for blue-collar Brazilians. We caught up with Jake to get a closer look at the new startup and talk all things Brazil.
Wharton Journal: Tell us your story. Why Brazil, and why job recruiting?
Jacob Rosenbloom: Before coming to Wharton and Lauder, I had already lived for two years in Brazil and had spent my pre-MBA career investing in Latin America at Goldman Sachs. I had spent six years living, working and studying in Colombia, Mexico, Argentina and Brazil and continued to invest in the region through the Lauder Spanish program. During my two years at Wharton, I interned with Endeavor in Bogotá, Colombia. Given my professional and academic focus on Latin America, and given Brazil’s rise over recent years, it was an easy decision to return to Sao Paulo.
In my time living in Brazil, I learned that the human resources industry was one of the major challenges and opportunities in the Brazilian economy. One of my co-Founders, Derek Fears, also extensively researched informal labor markets while at Stanford and at the World Bank. We were intimately aware of the holes in the HR industry. We also noted that extremely innovative start-ups had really disrupted the industry in developed markets (creating multi-billion dollar businesses in the process), this really had not yet hit the Brazilian market.
WJ: It’s interesting that you chose SMS as the primary medium for everything, from collecting resumes to communicating job openings to arranging job interviews. Why SMS?
JR: SMS is clearly the preferred medium for communication at all levels of social class in Brazil, and particularly at the “blue-collar” level in which we operate. While smartphone and mobile data penetration (extremely low in the “blue-collar” segment) will certainly increase, the simplicity and ubiquity of SMS makes it core to a mobile-first technology and the development of an extremely large user database.
WJ: Congratulations on closing your first funding round! How did you approach the fundraising process, and what would you say was the hardest part about it?
JR: We targeted investors based in Brazil and in Silicon Valley that had demonstrated interest in Brazil. I have a great team of Sao Paulo based co-founders and we leveraged the investor contacts that we had cultivated in our careers, including those that I had cultivated in the years I spent working as an investor in Brazil. The largest hurdle was finding investors who were interested in newer business models designed specifically for Brazil (or developing countries in general). Much of the recent investment in Brazil has trended toward replicas of proven business models from the States or Europe, especially in the e-commerce space. We were certainly aware of this dynamic, and understood why it might make sense from an investor perspective, but the market we are going after (HR) is too large and exciting for us to ignore. One of our central theses has been that the companies that will become truly sustainable in Brazil will be those that are designed specifically (not just localized) for the Brazilian marketplace.
WJ: What is it like to now be part of 500 Startups?
JR: 500 Startups has an extensive network of mentors and co-investors throughout the world. They also have a team based in São Paulo that is responsible for a lot of the events that are helping to build the Brazil-entrepreneurial ecosystem. The mentors have given us extremely valuable advice on our expansion strategy.
WJ: Can you talk a bit about Emprego Ligado’s business model?
JR: Over the last two years the Brazilian economy has undergone a drastic shift in the balance of supply and demand for labor, and companies have become increasingly more desperate to find operational-level workers. The pain point is clearly at the company level, where HR managers simply cannot get candidates in the door. We offer a unique and innovative solution that focuses on simplicity, speed and location, and we pass on all costs to the companies to ensure that the service is entirely free for job-seekers.
WJ: What’s next for Emprego Ligado, post-funding? Any exciting new developments we should be watching out for?
JR: We are busy putting our capital raise proceeds to work. We already have a team of ten based in São Paulo, with seven Brazilian employees and executives and we will be adding more top-tier and unique Brazilian talent shortly. We are also in the process of developing a number of new product features that we think will really revolutionize the way companies find and hire candidates. Additionally, subsequent to closing the funding round, we have received capital from some other exciting local investors that we will be announcing in the future.
WJ: Prior to coming to Wharton, you worked in investment banking at Goldman Sachs. What challenges are you facing as a first-time entrepreneur?
JR: I had also studied first-class entrepreneurs closely while working at Endeavor in Colombia. The benefits of having spent several years working in the Brazilian marketplace are clear, and I cannot underscore the importance of having a strong co-founding team. We also hired several senior Brazilian executives from the human resources, wireless and technology industries at the beginning, which has catapulted us forward. The challenge for a first-time entrepreneur is learning to push hard while planning for contingencies and also realizing when something isn’t working out. This balance of 3 skills is hard to develop.
WJ: Any advice for current Wharton MBAs who are looking to transition to entrepreneurship while on campus?
JR: The two years on campus is a blessing. If you are serious about entrepreneurship, take the time to develop your ideas and research them while on campus. The summer internship is an unrivaled opportunity to get experience that will pay huge dividends when starting a venture or working at an early-stage company after the MBA. Forget about the aesthetics or resume value of the summer experience and focus on roles that will give you first-hand, operational understanding of early-stage companies. If you can identify which industry or vertical you are interested in and target that, even better.