Investing in Emerging Markets in Latin America: Opportunities in Brazil and the Healthcare Sector

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  1. Mental healthcare is currently centralized in psychiatric institutions, and coverage of community-based mental health services is still very low. Services are unequally distributed across the country’s many regions (although some reforms addressing this issue have been carried since 1990). At present, the number of psychiatrists per capita stands at roughly 5 per 100,000 inhabitants in the Southeast region; the situation in the Northeast region is even more dire, with less than 1 psychiatrist per 100,000 inhabitants.
  2. There is not yet a high degree of integration between primary care and mental health teams working at the Psychosocial Community Centers (CAPS) level. Doctors handle the majority of patient concerns, foreclosing the possibility of allowing a psychologist or psychiatrist to make informed healthcare decisions with patients.
  3. Anxiety disorders and depression are highly stigmatized. People suffering from anxiety and depression often face cultural stigma around these conditions; in Brazilian culture, mental health issues are often considered shameful to discuss openly, and are therefore underplayed and under-recognized.
  4. A fast-paced, demanding work culture takes a toll on workers’ mental health — and poses its own barriers to accessing care. In high-stress/high-intensity environments, such as workplaces, employers do not recognize the need to take time off to prioritize mental health. The impact of mental health on productivity and performance is not yet fully quantifiable, making employers reticent to adopt broader systemic changes in this area.
  5. Mental healthcare is prohibitively expensive. Who can afford access to mental health services? Traditional mental health therapy solutions are cost-prohibitive for most Brazilians, currently available only to the highest-earning 20% of Brazilian society. Only ~25% of the population has health insurance, and even then, it’s very difficult to get an access. This results in mental healthcare only being accessible to a few at the top of the country’s income scale: in practice, only about 1m — 2m people (or roughly 0.5%-1% of the population) have ever done any kind of psychotherapy.
  1. With over 4.8k tech startups, including 10+ public ones and 17+ unicorns, Brazil is the nerve center of the South American startup ecosystem. Many companies are run by highly educated, visionary CEOs who understand the importance of hiring, retaining, and nurturing great talent — and also understand the detrimental effect of anxiety, depression and burnout on organizational performance. With the tech sector booming and people being front and center, workaholic culture and its deleterious effects on mental health will increasingly be in the spotlight.
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  1. There is a demonstrated correlation between limited access to education and mental health issues, and innovation in the Brazilian EdTech sector spurred by the COVID-19 pandemic promises to address these interconnected problems. In Brazil, adolescents whose mothers had fewer years of schooling had a higher prevalence of depressive and anxiety disorders. Thus, I anticipate that the incorporation of EdTech in the Brazilian public school sector will have a positive impact on the population’s overall mental health, especially in rural areas.
  2. Growing awareness of mental health conditions and the importance of prioritizing mental health will lead to heightened public awareness of these issues. These topics are gaining the attention of researchers and increasing institutional support: several important studies on the prevalence of mental disorders in the adult population, including population-based studies, have recently come out of Brazil, featuring data from the Brazilian National Health Survey, the Sao Paulo Megacity Mental Health Survey, the Study of Cardiovascular Risks in Adolescents on children and adolescents.
  3. More than two thirds of Brazilians have access to smartphones and the internet, which exceeds the global average. Nubank capitalized on the massive mobile phone adoption rate and reliable cellular phone service to reach underserved populations in rural areas. This tactic can be replicated in digital healthcare as well.
  4. Generationally, millennials and Gen Z are breaking down historic stigma and silence around mental health issues, openly discussing the importance of mental health and demanding high-quality, accessible solutions in this area. This is also the same category of people who are the most impacted by mental health disorders — another factor pointing to increased interest in digital mental health services.
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Stanford GSB alum, early stage VC in consumer and SaaS, angel investor in ClassPass and Vinebox

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Olga Maslikhova

Olga Maslikhova

Stanford GSB alum, early stage VC in consumer and SaaS, angel investor in ClassPass and Vinebox

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