“Brazil is a very high-quality market, both in terms of publishers and readers,” says Penguin CEO John Makinson. “In most areas it is comparable to America or Britain or any other developed markets.” And the man knows of which he speaks, having led Penguin to acquire 45% of Companhia das Letras, a renowned publishing house based in São Paulo, in December last year. It represented the first time a British trade publisher had made a significant investment in a Brazilian publisher.
The investment came almost two years after an initial partnership to launch Penguin Companhia, a Brazilian imprint which publishes classic titles from both houses. “It’s still a relatively young relationship, but it is showing great promise,” says Makinson. “We are selling more rights to them than we might otherwise, and we’ve been bringing their books into the global English-language market. Overall it’s doing well.”
Makinson notes that part of the appeal in acquiring Companhia was Penguin’s track record with commercial books; in the intervening year Companhia has since launched a new imprint, Editora Paralela, which publishes Penguin’s stalwart chart topper Patricia Cornwell, among other bestsellers. Another outcome has been an acceleration of Companhia’s digitization program, as the publisher is now able to tap into Penguin’s global expertise.
Penguin’s acquisition came a little more than one year after its parent company, Pearson, spent £326 million to buy private school learning systems from SEB Brazil, a move that immediately turned Pearson into one of the leading educational groups in Brazil. The resulting internal relationships should help Companhia boost sales to the government’s school adoption programs, as well as smooth distribution around the vast country.
Contrary to rumors, Makinson flatly states that Penguin’s investment in Companhia is not the centerpiece of a Latin American strategy. “We don’t have a Latin American strategy, and won’t have one for the time being. Nor is this about publishing books in Portugal. We regard Brazil as an important market in its own right.”
He also notes that lumping Brazil’s publishing business into comparisons with China and India, where Penguin has also established operations, is not quite right. “China and India feel like emerging book markets,” he notes. “Brazil does not. While they are not quite there with digital yet, that is likely about to change, and when it does it will happen fast — in months, not years.”
On a personal level, Makinson says that he is comfortable working in Brazil. “I feel I understand how Brazilians do business,” he says. “I feel culturally aligned there — which is not always the case with some of the places where I travel for business.” He also says that he’ll likely be spending more time there in the coming years, particularly in 2014. “It’s good to know that when the World Cup is on, I’ll actually have an excuse to go,” he says. “Though,” he adds, pragmatically, “I wouldn’t bet on England beating Brazil at home.”