Actors, actions and cultural domination within the social construction of the risk capital industry in Brazil

Abstract

This article approaches the Brazilian venture capital industry through the trajectories of agents who contributed to its development. The State played an important role in regulating this industry, most notably through the creation of the Securities and Exchange Commission (CVM), the Financier of Studies and Projects (FINEP) and BNDESPar, the subsidiary of the National Bank for Economic and Social Development (BNDES). The article concludes that, although the legitimacy of this industry is linked to the financing of technological innovation by the firms that operate in the venture capital segment, those who dominate the industry prefer to invest in the private equity segment, where the return on investment is significantly higher and the risk, lower. As a result, the CVM’s data indicate that venture capital financing, where uncertainty and risks are highest, falls mainly on government agencies, reproducing the prevailing ideology in the global industry.