High Interest Rates Anchor Brazilian Venture Capital Amid US AI Surge

The new global wave of technology investments, powered by artificial intelligence, is underscoring a deepening contrast between the United States and Brazil. While the American market returned to levels near $300 billion in 2025 and reached a historic $267 billion in the first quarter of 2026 alone, the rest of the world has yet to witness the same excitement in the sector.

Data from the National Venture Capital Association (NVCA) and global reports from KPMG reveal that funding in the United States neared the record-setting levels of 2021 during 2025. Remarkably, the first quarter of 2026 alone surpassed the entirety of 2025, while Asia, Europe, and South America continue to lag behind.

Between 2020 and the first quarter of 2026 (Q1 YTD), the United States concentrated approximately $1.74 trillion

in venture capital investments. Meanwhile, Asia accumulated roughly half of this value, followed by Europe with $500 billion. Brazil, by contrast, moved approximately $21.5 billion. These numbers highlight a sharp disparity, with the Brazilian venture capital market accounting for less than 1% of global VC investments. While the country appears to represent an attractive opportunity—with total investment values hovering near countries with similar economies, such as Spain ($17 billion) and Australia ($23 billion)—it remains far behind other major economies like Japan or Canada, which near $40 billion annually.

More than just a historical gap, the current landscape reveals a clear divergence in trajectories. In the United States, breakthroughs in artificial intelligence have reignited the appetite for risk and fueled a new technology investment cycle. In Brazil, the macroeconomic environment continues to constrain the sector’s expansion and hamper a consistent recovery.

For Victor Mariz Taveira, CEO of Acrux Capital, interpreting these numbers requires broader context.

“The global economy, particularly the American one, experienced a significant boom in 2021, driven by the intensive use of technology during the pandemic. At that time, a record volume of capital was funneled into venture capital. Now, what we are witnessing is a new wave, pulled forward primarily by artificial intelligence, which is once again attracting large-scale investments,” Mariz states.

The Brazilian scenario, conversely, has yet to regain the momentum seen during that peak period.

“When we look at Brazil, even considering the most recent data, the invested volume remains far from the 2021 peak. Proportionally, it revolves around 40% of that level, which demonstrates that the industry has not achieved a consistent recovery,” says the CEO of Acrux Capital.

High Interest Rates and Structural Hurdles Stall the Sector’s Progress

The high-interest-rate environment remains the primary pressure point on the local market. Brazil was one of the first countries to begin hiking interest rates in 2021, and they have persisted well above 10% due to an unfavorable fiscal policy and high currency sensitivity.

“The central point lies in the interest rate level, which has remained elevated for a prolonged period. This factor impacts not only venture capital but also household debt, delinquency rates, and corporate investment capacity. It is a systemic effect,” Mariz asserts.

Historically, the behavior of the venture capital sector in Brazil tracks interest rate cycles, creating sharp fluctuations and complicating the formation of a more stable, long-term industry. For Fernando Silva, head of venture capital at Crescera Capital, capital cost volatility causes recurring shocks across the ecosystem.

“Historically, venture capital in Brazil is highly correlated with interest rate cycles. Because we experience very abrupt variations, it creates frequent shocks in the market, almost always negative, as we observed in the years following the 2021 peak,” Silva notes.

The rapid transition from a low-interest-rate environment to double-digit levels compromises not only new funding rounds but also the growth capacity of already-backed companies.

“When you go from a 2% rate to over 12% in a short span of time, the impact is widespread. It becomes unfeasible to finance growth and innovation at such a high cost of capital, which ultimately contaminates the entire ecosystem,” he says.

Brazil and the US Show Vastly Different Venture Capital Profiles

This scenario reflects deeper limitations within the Brazilian market. The lack of depth in local capital markets and the absence of large technology corporations capable of leading innovation cycles restrict the sector’s development.

In 2025 and 2026, the United States has stood out as a massive outlier in this analysis, capturing more than $550 billion in investments since the beginning of 2025 and consolidating nearly 50% of global corporate backing. Almost half of this value was driven by unprecedented transactions. These include a massive $250 billion deal involving SpaceX and xAI in 2026, Meta’s (NASDAQ: META) $14.3 billion licensing agreement and investment in data labeling and modeling firm Scale AI, and Nvidia’s (NASDAQ: NVDA) $20 billion licensing deal with Groq, which closed in 2025.

These companies possess a vastly different profile. Late-stage and growth equity companies (Series D+) are seeing median pre-money valuations exceeding the 2,3 billion-dollar mark, surpassing the historic benchmarks registered in 2021, when median pre-money valuations in the same series hovered near $1 billion. This highlights a drastically different stage of business development and maturity.

In Brazil and other emerging markets, investments remain heavily concentrated in early-stage companies carrying higher risk, which are more severely impacted by interest rates and macroeconomic conditions.

Furthermore, in the United States, large technology corporations act as engines of innovation, driving acquisitions and new investments. In Brazil, this corporate venture role has yet to consolidate, reducing the overall dynamism of the ecosystem.

Restricted credit and the high cost of capital are already directly impacting the daily operations of startups. Companies with consolidated business models face difficulties raising new rounds, while investors adopt a more conservative posture.

“From what we observe closely, a significant number of companies are seeking capital without being able to advance their rounds. In some cases, even within our own portfolio, entrepreneurs have resorted to personal funds to sustain growth given the fundraising challenges, even in businesses with solid fundamentals,” Mariz reports.

A Selective Market Signals Maturity Despite Restrictions

Despite the more restrictive environment, the current cycle also points to a significant shift in how investments are structured in the country. This movement reflects a healthy transition away from the previous period, which was marked by excess liquidity and inflated valuations. For João Braga, CEO and founder of Booming, the correction was necessary to rebalance the market.

“At that time, we saw capital raises based far more on expectations than on actual results. This naturally led to a significant correction in the following years,” João Braga states.

The current landscape indicates a more discerning market, with an increasing focus on financial efficiency and cash generation.

“Today, rounds are much more anchored in concrete metrics, such as EBITDA and historical revenue, and less on long-term projections. This makes investing more technical and less narrative-driven,” Braga says.

This shift also contributes to the consolidation of more resilient companies capable of weathering adverse cycles.

“What we see today is an investor who is closer to operations, entering not just with capital but with a genuine capacity to add value to the business,” Braga notes.

The rise of hybrid financing structures is also gaining traction in the market.

“The combination of venture debt and equity is poised to capture more space, bringing greater discipline to the market and expanding growth alternatives for companies.” João Braga, CEO and founder of Booming

The combination of high interest rates, lower liquidity, and greater risk aversion limits the industry’s development at a time when the world is experiencing a new technological wave. For the Acrux executive, this scenario indicates that analyses based solely on short-term variations can distort the true perception of the sector’s developmental stage in the country.

“An analysis based only on growth relative to the previous year can lead to mistaken conclusions. When we broaden the perspective, it becomes clear that Brazil is still performing well below what it should, even when considering its entrepreneurial potential,” Mariz asserts.

Despite the headwinds, the country maintains a robust foundation for innovation, with a high volume of projects and companies actively seeking capital.

“Brazil is, by nature, a country of entrepreneurs. What we see today is a limitation heavily associated with the macroeconomic environment rather than a lack of projects or execution capacity,” Mariz concludes.

About Acrux Capital Founded in 2003, Acrux Capital invests in and develops low-liquidity assets, specializing in non-performing loans (NPLs), legal claims (asset acquisition and the financing of administrative, judicial, and arbitral litigation), and venture capital.