I hope governments around the world are reading this and taking note. When you make it hard for your citizens to set up shop in your country, they are going to go somewhere else where it is easier. And all of the jobs that they would create, and money that they would pump into the local economy goes with them. It is similar to what happened to the movie industry in Hollywood. When other states and countries started offering tax breaks and streamlined permit processing, big productions moved out of California.
Not necessarily. They're more likely to go somewhere else where it is easier.
I didn't mean that everyone would just pick up and move, but enough might, and that could have an impact. Some people won't go anywhere, but they might stay and not start that business, which would have the same effect.
Thank you for sharing that story. Sounds like a very daunting process. When I was in the Philippines last year, there was an initiative to create a new visa that would grant permanent resident status to entrepreneurs who set up businesses that employed 10 Filipinos. I wish more countries would adopt this approach.
Thanks for introducing Philippines to the discussion (in addition to Chile). Both countries provide an example of how to attract entrepreneurs. And both are emerging economies.
When I follow the discussion on "entrepreneurial immigration" in USA and in Germany I see the same flawed logic: Everything's OK now, "we're on the top of the world", "why risk letting people in, maybe there will be terrorists among them"... Essentially, it's the policy of building higher walls and being, in effect, repellent. But also not realizing that entrepreneurs are a rare breed.
Why do not intelligent people act differently? Why has the high civil servant from my story let a pretty sure bet (my friend) leave the country?
Yes, it's the risk of being accused for letting a foreigner in but that is the surface of the problem. Underneath is the hubris. "We don't need it, we've got it all" mentality.
This is cool. I would like to see more news from accepted Startup Chile companies. Julio says there are lots of other benefits afforded by Chile, as has been said elsewhere; I'd like to hear some firsthand anecdotes about these benefits.
While i respect your decision, I'm not really sure why you didn't stay in Mexico, I think your article needs more details about what type of Help you got from the Mexican Gov., and what was the difference in Chile what did they offer?,
My big question would be, is it a totally different Market as you would expected to be? if so, what did you had to change on your business strategy?
To get an easy read on this reply i would divide it in main for topics:
- Why didn't stay and more details about it.
- Difference within Chile.
- Totally different market.
- Changes in business strategy.
## if you are truly interested on those topics please subscribe the blog, I'm planning to cover all of this topics on future posts. ##
-> Why didn't stay and more details about it. <-
This one in particular will be published soon, actually i'm just finishing the draft and maybe will be public in 2 days or something.
Try to subscribe, you can be sure that i will post open recommendations, opinions and reasons why i stooped paying Taxes in Mexico .. i hope someone in the government can read it.
-> Difference within Chile <--
I think its matter of philosophy .. almost all the country's will try to "get a piece of the pay", what Chile is doing here to have a clear vision to mitigate the "brain-drain" effect bringing some hope to local people. Its always good to have a guy in his 20's who did it big like your neighbor.
Mexico in the other hand is focusing his self in giving "easy loans" with high interest rate to young people.
This sounds like "hey, let me screw you a little, in a couple of years you will broke like 80% of the business but i will have my payback or get your home".. they are just doing it wrong.. very wrong.
-> Totally different market. <--
Yes, it us a huge unknown market for us .. but we are going to keep our Mexico operations in a virtual way .. just they will be not paying to a Mexican company; Instead payment will be sent to an international company (i don't know where yet).
Doing this they cant charge Taxes but we sure can attend clients in Mexico (and all latin-america) from any country in the world (Borders are so 90's).
-> Change in business strategy. <-
Well .. to be honest I'm a Mechanical Engineer... within my career i didn't learn anything about programming, html or css.. i just focused myself in Energy efficiency, heath transfer and entropy .. but the web was always my hobie.
When graduated (2008) all the world was "in crisis" and there where no lots of Jobs .. but the web was making billions so i used my web knowledge to start something else and using as a pivot in the future.. by now the pivot is going great!.
What im planning here is to have a customer-base within all latinamerica instead of just Mexico. I will also diversify to three or web apps.
### If you liked please subscribe, I'm planning to cover all this topics on my future posts ###.
As a partner of Mexican.VC (http://mexican.vc), a (pre)seed fund that invests in Mexican online startups, I can assure that the your vision of how Mexico works is quite incomplete. There's well enough funding in Mexico for early stage companies. You can find angels (Angel Ventures Mexico, Mex.VC), seed funds (Mexican.VC, Wayra, StartupFactory), early stage VCs (Alta Ventures, Ignia, Fondo Emprendedor CONACYT-NAFIN) and public grants (Prosoftware, Fondo PYME, AVANCE).
I'm not saying Chile is not a great country (I love Chileans), but IMHO your reasons to leave Mexico are fundamentally flawed.
Thanks for the comment.. i knew about some of the programs you mentioned there .. http://mexican.vc got my attention in particular.
I did research when started the company but a lot of doors where closed at that time and my options where to take a Loan or leave a part of the company to the seed funders.
I think gov should do something like Startup chile where they offer "free money" to start a wildfire in entrepreneur attitude.
*please add me to my twitter @j_camarena, will be cool to keep contact :)
I wouldn't say "fundamentally flawed". A bit simplistic, maybe, but totally understandable. Government funds are - let's say, shady - and private funds are usually who-knows-who and pretty inaccessible. I'm not saying that it's impossible but I certainly understand Julio: as good entrepreneur, he's taking the pragmatic route. Kudos for that.
The whole ordeal is by far more complicated than in the US, except for visas.
Starting is already hard enough by itself, so adding on top a thick layer of hoops to jump and bypass in Mexico isn't the best of things. The market is different, the talent pool is vastly different than sillicon valley.
There's a big focus in custom enterprise applications and consulting among CS workers and grads, very little product focus. There's a mindset gap where the majority of people believe starting, and doing something without getting squashed by El Goog or government is impossible. Convincing people that things "can be done" is an uphill battle.
Incubators are more of the generalist type.I applied and spent some time on my university incubator ("Tec") and found that the focus was in manufacturing, trading, and finance business. There was very little knowledge of tech startups. Accounting/Hr/taxes are pretty draconian as well.
On human resources, the culture here is a job culture, you finish your career, you get into a company, work 30-35 years and retire, that's what the community expects of you. Starting a company is awkward, working in something without payment or having immediate profits is a waste of time or foolish. But that is changing with the crisis, everything goes now.
Getting people can be a bit difficult, most candidates I have interviewed had little experience (if at all), with free software technologies we use and demonstrated little will to learn (education tends to be centered on specific technologies), most don't work well unsupervised, thus our remote working experiment failed, they don't use modern development tools such as version control, bug tracking and project management software, etc. That is a generalization, of course there is brilliant people here too, but way more difficult to find, hopefully if a startup community concentrates in a place the skillful workforce will also concentrate there.
Government paperwork has always been abundant, complicated and time sink.
Taxes are not well leveled, either you are of low class (you have a small shop "changarro/tiendita") and pay a low tax, or you are middle class, a professional, you do consulting and give out receipts, your tax is relatively low and simple (you may require an accountant to make sure you don't fall into an obscure tax law and have problems), or finally you are the rich class, you are a corporation, you pay high federal taxes, state taxes, enterprise taxes (IETU), and retain value added tax (IVA, the equivalent of sale tax or VAT), only this bracket you will be able to give out invoices (invoices are centrally controlled by the government), which is a requirement when your clients are companies.
Most startups (incorporated) and companies will fall in the top bracket, even if you don't make millions, in other countries you are most likely to pay taxes based on your yearly income.
Financing is thought, the problem is government financing which is very prone to corruption, which means all those stimulus mostly go to friends, family and the corporate backers of those in the government (some politicians promise those stimulus to their backers beforehand in campaigns).
Finally, lets not get started with crime and violence, I live in a very peaceful part of the country but I have still received 2 or 3 calls arguing that they have a family member kidnapped, asking for money, a friend of mine even got a visit of an extortionist asking for "piso" money.
I can understand well why Julio is leaving, I was tempted too to apply to Startup Chile and start a new, but Mexico also has its key areas that are unexploited on technology and will be great business in the near future.
Thanks for the comment Daniel, i totally agree with you in almost all the points.
I live in a very peaceful zone in Mexico so i have no problems with security .. Actually its kinda funny that the only time i was victim of robering was in LA and not in Mex.
About startup chile; try to apply. If you need help on your form dont hesitate in contacting me (my twitter is in my hn profile).
I think one of the key aspects in Mexico is Culture, by definition Work is where you are 8 hours a day, as you said finding someone that can manage its time without supervision its nearly impossible, let alone completing a task. A great point you mention is to gather around in a community and share our ideas and knowledge, running a business in Mexico, specially a technology related business can be overly complex.
I was accepted to Start-up Chile and arrived two weeks ago. You're in for a great ride Julio.
My biggest concern when I first got accepted was the caliber of people which would be attracted to the program. I hadn't seen any start-ups which had come out of the program, and thought maybe the government was just hopping on the incubator bandwagon.
Since arriving and meeting the entrepreneurs here, I've been very impressed. Amazing projects, great people from around the world.
You'll have no regrets with your decision. Look forward to meeting you in Chile.
If you have any questions, drop me an email, the address is in my profile.
Hello everybody. My name is Joshua, I'm also mexican and just a year away to finish my degree in computer science. I've also got my concerns about entrepreneurship here in Mexico but willing to start something.
I'd like to know whether there's a place that all of us gather and discuss such topics. I think Julio's thought about leaving Mexico for further support and opportunity is something that has thrived amongst many of us young people at some point in time. Personally, I'm just to decide what to do next, and I'm inclined to keep myself here in Mexico and do some breakthrough work in the education sector.
But as all of us knows, mistrust, corruption and legal/political/financial obstacles weaken our will.
Concluding, I'd like us to keep in contact with each other, because for me, trust is an issue and contributing to this discussion reflect the concern and unbiased point of view (as many "bootstrappers" would like to seem, as Julio mentioned).
My twitter is @syb_ and I'll be glad to keep in contact with all of you.
26 comments
[ 0.25 ms ] story [ 67.4 ms ] threadNot necessarily. They're more likely to go somewhere else where it is easier.
I didn't mean that everyone would just pick up and move, but enough might, and that could have an impact. Some people won't go anywhere, but they might stay and not start that business, which would have the same effect.
http://news.ycombinator.com/item?id=3224374
http://www.visasphilippines.com/sveg
When I follow the discussion on "entrepreneurial immigration" in USA and in Germany I see the same flawed logic: Everything's OK now, "we're on the top of the world", "why risk letting people in, maybe there will be terrorists among them"... Essentially, it's the policy of building higher walls and being, in effect, repellent. But also not realizing that entrepreneurs are a rare breed.
Why do not intelligent people act differently? Why has the high civil servant from my story let a pretty sure bet (my friend) leave the country?
Yes, it's the risk of being accused for letting a foreigner in but that is the surface of the problem. Underneath is the hubris. "We don't need it, we've got it all" mentality.
My big question would be, is it a totally different Market as you would expected to be? if so, what did you had to change on your business strategy?
Oh, and they will use those taxes to fund a stupid war.
To get an easy read on this reply i would divide it in main for topics:
- Why didn't stay and more details about it. - Difference within Chile. - Totally different market. - Changes in business strategy.
## if you are truly interested on those topics please subscribe the blog, I'm planning to cover all of this topics on future posts. ##
-> Why didn't stay and more details about it. <-
This one in particular will be published soon, actually i'm just finishing the draft and maybe will be public in 2 days or something.
Try to subscribe, you can be sure that i will post open recommendations, opinions and reasons why i stooped paying Taxes in Mexico .. i hope someone in the government can read it.
-> Difference within Chile <--
I think its matter of philosophy .. almost all the country's will try to "get a piece of the pay", what Chile is doing here to have a clear vision to mitigate the "brain-drain" effect bringing some hope to local people. Its always good to have a guy in his 20's who did it big like your neighbor.
Mexico in the other hand is focusing his self in giving "easy loans" with high interest rate to young people.
This sounds like "hey, let me screw you a little, in a couple of years you will broke like 80% of the business but i will have my payback or get your home".. they are just doing it wrong.. very wrong.
-> Totally different market. <--
Yes, it us a huge unknown market for us .. but we are going to keep our Mexico operations in a virtual way .. just they will be not paying to a Mexican company; Instead payment will be sent to an international company (i don't know where yet).
Doing this they cant charge Taxes but we sure can attend clients in Mexico (and all latin-america) from any country in the world (Borders are so 90's).
-> Change in business strategy. <-
Well .. to be honest I'm a Mechanical Engineer... within my career i didn't learn anything about programming, html or css.. i just focused myself in Energy efficiency, heath transfer and entropy .. but the web was always my hobie.
When graduated (2008) all the world was "in crisis" and there where no lots of Jobs .. but the web was making billions so i used my web knowledge to start something else and using as a pivot in the future.. by now the pivot is going great!.
What im planning here is to have a customer-base within all latinamerica instead of just Mexico. I will also diversify to three or web apps.
### If you liked please subscribe, I'm planning to cover all this topics on my future posts ###.
I'm not saying Chile is not a great country (I love Chileans), but IMHO your reasons to leave Mexico are fundamentally flawed.
I did research when started the company but a lot of doors where closed at that time and my options where to take a Loan or leave a part of the company to the seed funders.
I think gov should do something like Startup chile where they offer "free money" to start a wildfire in entrepreneur attitude.
*please add me to my twitter @j_camarena, will be cool to keep contact :)
The whole ordeal is by far more complicated than in the US, except for visas.
Starting is already hard enough by itself, so adding on top a thick layer of hoops to jump and bypass in Mexico isn't the best of things. The market is different, the talent pool is vastly different than sillicon valley.
There's a big focus in custom enterprise applications and consulting among CS workers and grads, very little product focus. There's a mindset gap where the majority of people believe starting, and doing something without getting squashed by El Goog or government is impossible. Convincing people that things "can be done" is an uphill battle.
Incubators are more of the generalist type.I applied and spent some time on my university incubator ("Tec") and found that the focus was in manufacturing, trading, and finance business. There was very little knowledge of tech startups. Accounting/Hr/taxes are pretty draconian as well.
On human resources, the culture here is a job culture, you finish your career, you get into a company, work 30-35 years and retire, that's what the community expects of you. Starting a company is awkward, working in something without payment or having immediate profits is a waste of time or foolish. But that is changing with the crisis, everything goes now.
Getting people can be a bit difficult, most candidates I have interviewed had little experience (if at all), with free software technologies we use and demonstrated little will to learn (education tends to be centered on specific technologies), most don't work well unsupervised, thus our remote working experiment failed, they don't use modern development tools such as version control, bug tracking and project management software, etc. That is a generalization, of course there is brilliant people here too, but way more difficult to find, hopefully if a startup community concentrates in a place the skillful workforce will also concentrate there.
Government paperwork has always been abundant, complicated and time sink.
Taxes are not well leveled, either you are of low class (you have a small shop "changarro/tiendita") and pay a low tax, or you are middle class, a professional, you do consulting and give out receipts, your tax is relatively low and simple (you may require an accountant to make sure you don't fall into an obscure tax law and have problems), or finally you are the rich class, you are a corporation, you pay high federal taxes, state taxes, enterprise taxes (IETU), and retain value added tax (IVA, the equivalent of sale tax or VAT), only this bracket you will be able to give out invoices (invoices are centrally controlled by the government), which is a requirement when your clients are companies.
Most startups (incorporated) and companies will fall in the top bracket, even if you don't make millions, in other countries you are most likely to pay taxes based on your yearly income.
Financing is thought, the problem is government financing which is very prone to corruption, which means all those stimulus mostly go to friends, family and the corporate backers of those in the government (some politicians promise those stimulus to their backers beforehand in campaigns).
Finally, lets not get started with crime and violence, I live in a very peaceful part of the country but I have still received 2 or 3 calls arguing that they have a family member kidnapped, asking for money, a friend of mine even got a visit of an extortionist asking for "piso" money.
I can understand well why Julio is leaving, I was tempted too to apply to Startup Chile and start a new, but Mexico also has its key areas that are unexploited on technology and will be great business in the near future.
I live in a very peaceful zone in Mexico so i have no problems with security .. Actually its kinda funny that the only time i was victim of robering was in LA and not in Mex.
About startup chile; try to apply. If you need help on your form dont hesitate in contacting me (my twitter is in my hn profile).
That's why you got the error; i don't no lots of traffic there but i will be done by today's night.
Anyway i removed the link on our company website, thanks again :).
http://jcamarena.com/startups/que-es-startup-chile-y-por-que...
http://www.noticiashacker.com/noticia/julio-camarena-qu-es-s...
My biggest concern when I first got accepted was the caliber of people which would be attracted to the program. I hadn't seen any start-ups which had come out of the program, and thought maybe the government was just hopping on the incubator bandwagon.
Since arriving and meeting the entrepreneurs here, I've been very impressed. Amazing projects, great people from around the world.
You'll have no regrets with your decision. Look forward to meeting you in Chile. If you have any questions, drop me an email, the address is in my profile.
Would be great to get a beer (or pisco (?)) there on Santiago :).
I'd like to know whether there's a place that all of us gather and discuss such topics. I think Julio's thought about leaving Mexico for further support and opportunity is something that has thrived amongst many of us young people at some point in time. Personally, I'm just to decide what to do next, and I'm inclined to keep myself here in Mexico and do some breakthrough work in the education sector.
But as all of us knows, mistrust, corruption and legal/political/financial obstacles weaken our will.
Concluding, I'd like us to keep in contact with each other, because for me, trust is an issue and contributing to this discussion reflect the concern and unbiased point of view (as many "bootstrappers" would like to seem, as Julio mentioned).
My twitter is @syb_ and I'll be glad to keep in contact with all of you.