SÃO PAULO, Brazil - Peter Thiel's Valar Ventures Management has made its first foray in Brazil, leading an investment in an e-commerce start-up that is trying to shake up the traditional furniture market here and take on an established retailer recently acquired by the Carlyle Group.
Oppa, a design and furniture e-commerce company based in São Paulo, recently closed on $10.47 million in financing, according to securities filings. Mr. Thiel's Valar led the round.
Oppa was founded by Max Reichel, a German expatriate. A former McKinsey consultant with an M.B.A. from Harvard, Mr. Reichel is trying to bridge e-commerce with design, selling products the company itself creates while also expanding opportunities for designers.
Founded last year, the company initially raised $2.36 million, according to filings. Monashees Capital, based in São Paulo, Kaszek Ventures and Thrive Capital invested in that round. They also joined the recent one led by Valar, accordin g to Mr. Reichel.
Representatives of Valar, which for now appears to invest Mr. Thiel's own capital, first visited Brazil in March, according to a partner, Andrew McCormack, and have since made four or five more visits.
Mr. McCormack said he first met Mr. Reichel in March at a Founders Forum event in Rio de Janeiro, and was drawn to his “very dogged determination†and what Mr. McCormack called typical founders' experiences - including maxing out his credit card and crashing on his friend's couch while getting started.
Even with the new investment, Mr. Reichel still has his work cut out for him. The giant brick-and-mortar furniture retailer Tok & Stok recently sold 60 percent of the company to the Carlyle Group for about $347 million.
Tok & Stok has been slow to migrate online, but once Brazilian regulatory authorities approve the deal, the company plans to “pay more attention†to e-commerce, said Daniel Sterenberg, a director with Carlyle's bu yout team for Latin America.
“We want to focus and invest more in Tok & Stok's online channel as part of our growth plans,†Mr. Sterenberg said.
Other retailers are likely to do the same.
While Oppa is Valar's first Brazilian investment, Mr. Thiel has indirectly made at least one other, investing in 2010 in the first institutional fund of Felicis Ventures. That fund, based in Palo Alto, Calif., invested in two financing rounds for Baby, an e-commerce site for baby products based in São Paulo.
Given Brazil's high taxes, vexing regulations and pro-labor laws, at first glance the country would appear to be an unusual market for Mr. Thiel, who is an avowed libertarian. Brazil was No. 48 in the latest World Economic Forum Global Competitiveness ranking, behind Estonia, Panama and the Czech Republic. That was a slight improvement from 2011, when it was No. 53.
Still, Mr. McCormack said that if Valar put too much weight on regulatory factors and m acroeconomic risks, the firm would be forced to rule out too many companies and countries.
“Even though Brazil has many layers of government, among the BRICs it is quite a good place to do business,†he said, referring to Brazil, Russia, India and China.
