Why SoftBank is Investing in Brazil, and Why Nobody There Seems to Care About WeWork

SoftBank has made plenty of headlines lately, but for all the wrong reasons (like the downfall of WeWork, its once-darling investment in the United States). In other regions, though, the Japanese investment firm is managing to quietly dole out its mega-bucks—minus the intense level of scrutiny that follows its fund or other investments.

The growing middle class and fast adoption of new technologies has made Latin America—and in particular countries like Brazil and Mexico—a prime target for SoftBank. The firm has already made bets on 10 different startups in the region, according to Ralf Wenzel, the chief executive officer of the SoftBank’s Latin American Tech Hub. The exec spoke at this week’s Fortune Global Forum in Paris, where he talked about the various reasons why this region is so attractive to Softbank. (In total, SoftBank is committing $5 billion in investments in Latin America.)

“We have 650 million people,” Wenzel said on Tuesday during an on-stage interview at the Fortune conference, “and they’re a very, very strong adopter of technology.”

According to Wenzel, Brazil is the No. 2 country for Netflix when it comes to subscriber numbers— that’s still a distant second to North America, the streaming service’s biggest market. Facebook and ride-sharing app Uber also have huge penetration in Brazil, said Wenzel.

To date, SoftBank’s investments in Brazil include startups in the food delivery and real estate space. Those aren’t exactly new categories, but Wenzel told the audience at this week’s conference that that hardly matter.

“[Latin American] companies can look at ideas that have been developed in China and the U.S., and they can mirror them,” said Wenzel. In other words, the local market is so large and so robust that just investing in more localized versions of existing services presents a big opportunity for SoftBank.

Wenzel also addressed some of the recent controversies surrounding Softbank’s $100 billion Vision Fund, the largest venture capital fund in history—and the investment vehicle responsible for putting massive rounds in companies like Uber and, yes, WeWork. The exec said that the negative attention about SoftBank’s investment track record has not impacted his work in Latin America.

“It’s part of the constellation,” said Wenzel, referring to the sheer size of Softbank’s funds and portfolio of investments.

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