The Brazilian mergers and acquisitions (M&A) market continues to mature and is increasingly integrated with the Artificial Intelligence (AI) ecosystem. More than half of Brazilian startups use the technology, and 31% develop AI-based products, according to the research "Unlocking the Potential of AI in Brazil," conducted by AWS. The study also shows that 78% of the companies surveyed believe that the use of new technologies could be the key to a turning point in their businesses in the next five years.
The survey also reveals another relevant point: while 31% of companies are developing new AI-based products, 37% are already directing efforts towards attracting talent in technological development, broadening their focus beyond the application of artificial intelligence.
Marcel Malczewski, CEO of Quartzo Capital, observes that startups that advance in operational efficiency, structure their decision-making based on data, and incorporate automation and technological personalization generate a more competitive positioning and, consequently, greater attention from investors. “Especially in a more selective capital environment, but M&A moves only generate value when there is efficient capital allocation,” said Malczewski during a lecture on M&A strategies, held in Curitiba, this Tuesday (2).
In the third quarter, Brazil recorded 252 deals in the technology sector, according to a report released by TTR Data. During this period, a total of 1,303 M&A transactions were recorded in the country.
M&A growth is expected to remain modest in 2025.
The most recent report from TTR Data, in October, shows a slight growth in the mergers and acquisitions market in Brazil compared to the same period in 2024. In the first 10 months of the year, 1,475 transactions were registered, representing a 5% increase in the number of transactions and a 2% increase in capital mobilization compared to the same period last year. According to the report, the volume generated by transactions in Brazil during this period was R$ 218 billion.
According to Gustavo Budziak, managing partner of Quartzo Capital, one of the main factors that scares investors when undertaking an M&A transaction is the high interest rate. In the last three years, the Selic rate has hit record highs, varying from 10.2% to 15%, maintaining its maximum level for the last six months, according to data from the Central Bank (BC). "The maintenance of the Selic rate makes investors apprehensive, and they end up opting to leave their money idle rather than risk it in an M&A transaction, which is a risky move," Budziak pointed out.
However, according to the expert, investors have been seeking alternatives for M&A operations, mainly SaaS and fintechs. "The reduction in the valuations of these companies has made them more attractive for M&A operations, but we also see a shift within companies that are not only looking to buy others, but creating their own CVCs (Corporate Venture Capital) in search of new technologies to incorporate into their products."
