RESIDENTS of seaside Florianopolis like to call software
developer Paulo Guimaraes "our Bill Gates."
The 35-year-old former motorcycle racer and founder of a
software company here, has won prizes for his ground-breaking
inventions, including an infrared wireless communications system he
hopes to sell to Chicago's commodities market.
Mr. Guimaraes, who studied computer science in the United
States, is one of several up-and-coming entrepreneurs who local
officials say are turning this picturesque island resort into a
South American Silicon Valley.
"We know it sounds like a dream," says Rodolfo Pinto da Luz,
director for computer development of Santa Catarina state. "But we
have the talent and the will to become a Brazilian Silicon Valley."
Several up-and-coming software firms are located throughout the
state. But it's new software haven, dubbed "Tecnopolis," is here in
Today, Tecnopolis is home to only 50 employees, with one
completed building -- a fiber optic telecommunications company --
and another under construction. But 12 Brazilian companies and a
German software firm called Baden-Baden have bought lots and are
expected to begin construction soon.
"The combination of Florianopolis's beauty and state incentives
will lure many companies here," predicts Neri dos Santos, Santa
Catarina's secretary of state for science and technology.
Those incentives include $3 million in infrastructure, selling
land at 10 percent below the market value, easy credit for research
projects, and property- and excise-tax exemptions.
Moreover, small firms without sufficient capital can qualify to
use the "incubator," a mini-industrial park that provides hefty
discounts on laboratories, equipment, business services, phones,
and even the omnipresent "cafezinho," or little coffee, delivered
by uniformed waiters. Industry experts say this will help reduce
the industry's two biggest problems here: poor management and lack
Currently, a national incentives program called Softex 2000 aims
to boost the nation's global software market share to 1 percent by
the end of the decade. Brazil's current $1 billion industry makes
up only 0.5 percent of the world market. United States companies
have captured an estimated 50 percent.
Softex 2000 hopes to create 200 software companies and 50,000
jobs in 14 urban areas, or "poles," including three in the state of
Despite the generous incentives, state officials have had
problems wooing international firms. Foreigners are wary of a
return of Brazil's chronic inflation, even though the new President
Fernando Henrique Cardoso's current economic plan has tamed it.
Other causes for concern are a lack of enforcement of copyright
laws, existing tariffs, and the federal government's infamous red
Attracting US companies
To date, officials here say representatives of IBM Corporation,
Apple Computer Inc., Microsoft Corporation (chaired by Bill Gates),
and Olivetti, based in Ivrea, Italy, have visited Tecnopolis and
expressed interest. John Andara, owner of the Miami-based Zyx
Corporation, says he will relocate if state officials fulfill their
commitments. But he says he doubts other US firms will follow
without a fundamental change in Brazil.
"It's painful to do business in Brazil. It's so bureaucratic,"
he says. …