Gatekeeper of a Brazilian Fortune Isn’t Letting Unicorns Inside

(Bloomberg Markets) -- When Brazilian billionaire retail magnate Abilio Diniz first asked Flavia Almeida to join one of his companies about 15 years ago, she said no. 

Almeida already had a distinguished career as a partner at McKinsey & Co. Several years later she turned Diniz down again before finally accepting an offer from him in 2013. She took a position at his family office, Península Participações SA.

“So, Flavia, now are you ready to be happy?” she remembers Diniz asking her.

If happiness can be measured by one’s rung on the career ladder, she could be described as elated by now. Almeida, who became chief executive officer of Península this August, is the first woman to run a major family office in Brazil. Península manages $3.7 billion on behalf of Diniz and his family, who built a fortune through the retail business his father founded.

Almeida, 52, has had a long career working closely with companies’ top decision-makers, which helped earn her the trust of the 82-year-old Diniz. “To manage is to put the right people in the right places,” Diniz said in a WhatsApp message. “Flavia reached the CEO position because she’s very competent, prepared, and solid in her leadership.”

One of Brazil’s most controversial entrepreneurs and the writer of two bestselling autobiographies that are part self-help and part management strategy, Diniz has been at the center of two major corporate battles. One was with Groupe Casino’s Jean-Charles Naouri, a fight that ended in 2013 when Diniz lost control of the giant supermarket chain, Pão de Açúcar, founded by his father in 1948. A spat with investors at poultry producer BRF SA led him to resign from the chairmanship of that company’s board in 2018.

Almeida, who has a master’s degree from Harvard Business School, plays down Diniz’s reputation as a mercurial boss. “Abilio has reinvented himself through time, and that’s what I admire the most in him,” she says in an interview at the firm’s offices in São Paulo. “At BRF, a crisis in which I actively worked on and helped to resolve, I saw him trying to be a conciliator. And I’m glad we reached a consensus on a person to replace the CEO, and we’re making it work.”

Although Diniz has been replaced as BRF’s chairman, Almeida still has a seat on the company’s board, representing Península, the sixth-largest shareholder, with a 3.9% stake, according to data compiled by Bloomberg. She also sits side by side with Diniz on the board of France’s retail giant Carrefour SA, which counts Península as its third-largest shareholder, according to Carrefour.

Along with BRF and Carrefour, Península’s investments include a vast portfolio of commercial real estate, an organic farm run by one of Diniz’s sons, and a stake in Mind Lab, a firm that specializes in education technology. It also partners with Jorge Paulo Lemann, Brazil’s richest man, in a stake in a bakery chain called Benjamin a Padaria.

Almeida “has a long-term view of a company, a strategic view; it’s not driven by short-term results,” says Patricia Moraes, who runs a private equity firm for the Trajano family, the owners of the retailer Magazine Luiza SA.

Moraes met Almeida through common friends at McKinsey. Almeida, who worked for McKinsey from 1989 to 2003, was the consultancy company’s first female partner in South America. When Almeida was named a director of the São Paulo Biennial Foundation, an institution that promotes contemporary art, she became close with Moraes. At the same time, Moraes’s husband was investing in paintings and sculptures. One of the traits Moraes notes about Almeida is her special effort to foster diversity and women’s rights.

Born in São Paulo, Almeida started her career as a trainee at McKinsey. After more than a decade there, she moved on to a CEO role at Participações Morro Vermelho SA, the holding company for the Camargo Corrêa family, who built their fortune through a construction empire. “The projects I enjoyed most in my life were the ones in which I worked with decision-makers, in which I was able to think with a business owner’s mind,” she says.

She has sat on the boards of more than 20 private and public companies since 2004, many as the first or only woman in that role. Not surprisingly, gender wage gaps and sexist jokes are among the challenges Almeida has had to face in a male-dominated industry. She concedes that there have been situations in which, as the only woman in a meeting, she felt disrespected to the point where she had to go to the ladies’ room to pull herself together. Even that can be a challenge, Almeida says: At one of her first jobs as a director, the board had only a men’s room.

She says she fought back with a sense of humor, diplomacy, and a lot of hard work. “I came from a family in which to study and work was an important ethic,” Almeida says. Married for 29 years, she says she couldn’t have succeeded without the help of her husband, Rodrigo Ferreira Leite, who works in advertising, in raising their two sons.

At Península, Almeida has helped create a team in which more than half of the 164 employees are women, but she opposes quotas that require a certain percentage of women on a board of directors. “A woman should have a role in a company because she deserves it,” Almeida says. “I believe in meritocracy.”

Almeida, who speaks fluent French, Spanish, English, and Portuguese, started at Península with the mission of structuring a direct investments department, including private equity. She says she’s open to new technologies, but she approaches startups with caution. “Península looks at innovation and wants to be part of this growth, but responsibly,” Almeida says. While technology is changing many industries, “that doesn’t mean two guys with an idea and a PowerPoint presentation” make for a legitimate startup, she says.

Almeida says she sees a bubble where some of the world’s biggest investors are pouring billions of dollars. “We have too many unicorns for the size of our economy,” she says. “Our shareholders put a lot of sweat into earning the money we manage here. We can’t afford to play around in a bubble.”

She’s shunning the raft of technology startups in the region that are all the rage with investors including SoftBank Group Corp. and Goldman Sachs Group Inc. Instead, Península is holding fast to its stakes in BRF and Carrefour.

Almeida isn’t tempted to follow the crowd despite the $2.6 billion of venture capital invested in Latin American startups in the first half of 2019. That’s three times more than in the same period a year earlier, according to the Latin American Private Equity & Venture Capital Association. Península’s last private equity investment was three years ago, when it took a stake in the wine e-commerce website Wine.com.br. “Some funds have been very bold—borderline irresponsible,” Almeida says. “Looking at a business and figuring out if it’s economically viable is crucial.”

SoftBank has invested more than $3.5 billion in new technology companies in Latin America since 2017, according to data compiled by Bloomberg. Goldman Sachs, Sequoia Capital, and Tencent Holdings are also making investments in startups in the region.

Over the past five years, Brazil has wobbled through recession and low economic growth, amid political upheaval that included a presidential impeachment, a transitory two-year government, and the election of right-wing President Jair Bolsonaro in a deeply divided vote. Península dumped some of its holdings during the period.

Divestments included the education company Anima Holding SA, and Península reduced its position in Carrefour’s Brazilian unit, Atacadão SA. At the same time, the family office increased its stake in Carrefour’s global operation. There was even speculation that Diniz wanted to take control of the French firm, but that never happened.

Península runs its own hedge funds, and it’s deciding whether to open them to outside investors amid a boom in the industry in Brazil. The family office also invests in funds offered by global asset management firms. The Península Institute, the family’s social arm, invests in initiatives focused on education and sports, passions of Diniz’s daughter Ana Maria and his son João Paulo.

Almeida says the Diniz family wants “to build a positive investment agenda” for Brazil. “It would be much easier to get this money and put it in the hands of half a dozen wealth management guys in New York,” she says. “But the family is committed to changing Brazil through entrepreneurship.” —With Robert Williams

Moura is a business reporter, Lucchesi is a senior reporter, and Marques is a finance reporter at Bloomberg News in São Paulo. 

To contact the editor responsible for this story: Steve Dickson at sdickson1@bloomberg.net, Siobhan Wagner

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