Some scholars think that the Portuguese followed up these voyages with an attempt to found a colony, a theory which is associated with the name of João Alvares Fagundes. A native of the town of Viana, Portugal, Fagundes probably explored the south coast of Newfoundland in 1520, and may have entered the Gulf of St. Lawrence - though some scholars do not think he went so far west. He received a captaincy to the lands which he had found and then, some think, began to implement plans for a Portuguese colony in the New World.
The story is that, finding Newfoundland too cold, the settlers found another location further to the west. Samuel Eliot Morison (1978) thought that the colony was established at Ingonish, Cape Breton, and other locations have been suggested. - Robert McGhee (1991), for instance, has suggested Mira Bay, between Glace Bay and Louisbourg. It is thought that the colony failed because of the hostility of local Natives. Whether this story is true cannot be established, given the evidence currently available.
Harald E. L. Prins' 1996 ethnography of the Mi'kMaq, The Mi'kmaq: Resistance, Accomodation, and Cultural Survival, goes into greater, confirmatory, detail.
In 1525, navigator Joao Alvarez Fagundes and some entrepreneurs from the port city of Viana, Portugal, formed an expedition to found a colony on Cape Breton Island -- at the edge of Mi'kmaq country. Commissioned by Portugal's kind, their "large ship and a caravel" sailed to the Azores Islands just west of Portugal (where ten families of settlers came on board) then crossed the Atlantic to the Bahamas, and coasted north until reaching Cape Breton. It seems they established their settlement somewhere on the island's north side, at Glace Bay or St. Anne Bay, "where there are many people and goods of much value and many nuts ... whereby it is clear the soil is rich" (Souza 1570, in Biggar 1911: 195-97)." (45)
Prins goes on to explain that in 1525, a Portuguese mariner named Estevan Gomez went to Cape Breton in search of the Northwest Passage. When he failed to find it, he captured a few dozen Mi'kMaq and took them back to Portugal as slaves. The Mi'kMaq were freed upon arriving in Lisbon, as free people unjustly taken into custody by trickery, though Prins notes that no one made provisions for their return to their homeland. Much later, Samuel de Champlain said that "rigour of the season and the cold made [the Portuguese] abandon their settlement." Perhaps a more important factor in explaining the collapse of the Portuguese effort was the understandable outrage of the Mi'kMaq remaining at the enslavement of their relatives and friends, and their successful sacking of the Portuguese settlement.
The enslavement of the Mi'kMaq strikes me, as it should strike other people, as a completely gratuitous crime. If Gomez hadn't decided to abduct dozens of locals to sell as slaves, the region of Canada might well be Lusophone to this day. More pitiful still is the fate of the Mi'kMaq stranded in Portugal. While I'd like to believe that they prospered in their new homeland, I fear that the extent of the culture shock and--more importantly--their weak immune systems may have doomed them. What would it have been like? I can hardly imagine.