Leveraging Rich Cultural History to Build a Thriving Innovation Ecosystem in Recife

If, 30 years ago, you were going to guess which part of Brazil would become a leading startup and innovation hotspot, you would probably not have guessed Recife. But you would be wrong.

Located in the northeast of the country, Recife is the state capital of one of Brazil’s most populated regions — and one of its poorest. Old Recife was full of beautiful, historical buildings, including the oldest synagogue in the Americas. But since the 1970s, the area had been mostly abandoned as residents sought more space and a modern lifestyle elsewhere. The closing of a nearby port accelerated the exodus. 

From the outside, it seemed like this central part of the city was on the decline. But a group of dreamers saw possibility instead. To their eyes, the beautiful empty buildings in a walkable, historic neighborhood were an accessible place to begin building a startup ecosystem. 

And they had another secret weapon too — Recife’s culture. A mix of Brazilian, Portuguese, Dutch, and African elements, the city has a 500-year history of combining the old and new, global and local influences, and turning them into something unique and exciting. Recife had the space and the soul, they thought, to build something great. 

Local institutions like Sebrae Pernambuco also played an early and ongoing role in empowering entrepreneurs and seeding the foundations of the ecosystem. In 2000, public and private sector and local universities partnered to launch the Porto Digital innovation district in Old Recife. In the decades since, it has become not just a geographic center, but also the spiritual heart of the thriving Recife innovation ecosystem and a blueprint for urban revitalization founded on a marriage of innovation and culture. 

How Porto Digital Grew from Two Companies to 475

When Porto Digital was founded, it had two companies in downtown Recife, remembers Claudio Marinho, former Secretary for Science, Technology and the Environment for the State of Pernambuco, who helped launch the project. 

Now – just 25 years later – the innovation district center is home to 475 companies, including a mix of startups and giants like Deloitte and Banco do Brasil. Local startups are building solutions for international firms like Microsoft and Apple, and more than 20,000 people work directly with firms based in Porto Digital. For example, today CESAR occupies 10,000 square meters of space in Porto Digital, while CESAR School offers popular doctoral courses related to IT that are connected to the specific needs of the ecosystem. 

“Recife has more people in universities and IT courses than any other city in Brazil,” says Marinho. “For every 100,000 people, 650 are in these courses, and 40 of the 475 Porto Digital companies are collaborating with IT courses.” 

This focus on training and education is part of a strategy that has been central to Porto Digital’s growth from the start. It not only builds the talent pool for companies, but also helps keep local talent in Recife. “We always aimed to seduce our young people to stay here and not migrate to São Paulo or other places for opportunities. We had to create jobs for our children here in Recife,” Marinho says. 

Innovation + Governance 

Local Porto Digital success stories like chatbot startup Tallos and AI company Neurotech have built businesses on top of innovative new technologies, attracting new startups, interest, and capital to accelerate the growth of the ecosystem. 

This focus on science and innovation has played a key part in Porto Digital’s success. Brazilian stock market operator B3 bought Neurotech for $214 million in 2022, injecting needed capital into the ecosystem. “Tallos made 93X the money that we invested in it,” Peixoto says. 

Now, a new generation of AI, Quantum Computing, and Cybersecurity startups are building the next wave of success on top of the latest scientific advances. From 2020 to 2024, early-stage funding in Recife grew an incredible 1,534%, driven by a $32 million venture round for medical software startup Amigo Tech in 2024.

Crucially, this success has also been supported by local entrepreneurship enablers like Sebrae Pernambuco. With programs such as Startup NE and Fast Motion, Sebrae guides founders from ideation through acceleration, while also fostering digital transformation through initiatives like Salto Tecnologico. Sebrae helps ensure inclusive ecosystem growth, strengthens innovation capacity across Pernambuco, and nurtures a pipeline of high-potential startups in Recife.

But while innovation may drive the ecosystem forward, its long-term success requires another ingredient as well: good governance. “Since the beginning, the managing unit of Porto Digital has been a public-private organizational board with 19 members. By Brazilian law they are a social organization where the government is not allowed to have more than 40% of the seats,” Marinho says. “This factor explains the success of Porto Digital through different governments – without cancellations or obstacles – to the continuity of the project.”

An Ecosystem on the Move 

The new vitality in Old Recife isn’t just captured in numbers and lists of accomplishments. It’s a feeling on the street. A compact, walkable neighborhood, entrepreneurs and ecosystem leaders bump into each other on the way to lunch and exchange ideas. Events like the annual REC’n’Play festival open the city to global visitors while building connections within the local tech and startup communities. A once abandoned neighborhood hums with ideas and excitement. 

A change is evident in the physical infrastructure of Old Recife, too. “We have had an impact on 150,000 square meters of old colonial buildings that have been restored and retrofitted into new uses for companies and innovation centers,” notes Marinho. 

Now, the ecosystem is exporting this energy. Many Brazilian startups have the potential to grow internationally, but some founders struggle with a language barrier. Portugal, which shares a common language with Brazil, holds direct flights and is an easy access to the European market, has become a natural stepping stone for startups looking to expand. That’s why Porto Digital Europa opened in October 2024 in Portugal to connect Brazilians to international markets. 

The energy of the ecosystem is spilling out into other parts of Brazil as well. The town of Petrolina, with its ideal climate and the geography to be an open air living lab for agriculture, is now increasingly growing Agtech advances, already being one of the largest producers of mango and grapes in the world. Petrolina actively hosts research centers such as Embrapa Semiarido and Agrobayer, along with universities and big packing houses that invest in research and development and export top quality fruits to North American and the European Market. It pulses so intensively that a Porto Digital center for agricultural innovation is set to open there to test technologies to bring farming into the future. 

Porto Digital’s Secret Sauce: Passion 

There are many innovation ecosystems in the world, but Recife isn’t just another good place to build. Its incredible Carnival festivities, urban aesthetic, and deep historical roots make it unique. Porto Digital is powered by a desire to share its culture with the world.

That may be one of the biggest lessons of Recife’s winding story that took it from being a onetime sugar-producing and export hub to a declining regional capital to a vibrant center for new ideas. Often the best approach to building an ecosystem is to build on top of your passion for who you already are. 

Porto Digital was built on top of Old Recife’s beautiful but underutilized real estate stock. It was also built on top of the city’s ethos of creativity. Pride in its history and culture has helped Recife reimagine itself with confidence and promote itself to the world.  

Enxerimento is a Portuguese word more commonly used in the Northeast Region of Brazil. It relates to a person who is curious, who follows their own ideas playfully, and doesn’t pay attention to formal boundaries. Recife is a city of enxeridos. And Porto Digital is an innovation district built in that spirit by leaning on local culture, believing in the future, and having fun in the process.