Juan Pablo Cappello
In MiamiTech, we have spent the past 10 years getting dressed up, waiting for our tech and finance friends from New York, San Francisco, and Los Angeles to show up and invite us to dance. Thanks to COVID, remote work, low taxes and sunny beaches, the venture, private equity and hedge fund crowd is now moving to South Florida in droves and transforming Miami.
Headlines like “Microsoft, Citadel and Elliott Management among firms expanding in South Florida” and “The SoftBank Miami Initiative is a $100 million funding commitment dedicated to supporting and building the community of technology start-ups in The Magic City” have become the new normal.
Thanks to COVID, remote work, low taxes and sunny beaches, the venture, private equity and hedge fund crowd is now moving to South Florida in droves and transforming Miami.
In the past few months, notables like Jonathan Oringer (founder Shutterstock), David Blumberg (Reddit co-founder) and leading venture capitalists like Peter Thiel, Keith Rabois, and Alexis Ohanian have joined tech luminaries like Eric Schmidt and Shervin Pishevar by having homes in the “305”. In the case of Peter Thiel he bought two homes next to each other.
While these “masters of the universe” types capture the headlines (and buy the largest houses), the real story lies with the thousands of talented tech and finance entrepreneurs, along with fund managers who are also making the move to South Florida.
And the TechnoLatino is also taking notice of Miami’s renaissance as a tech and finance hub after a decade long, dysfunctional love affair with São Paulo.
Since the dawn of the “Web 2.0” in the late 2000s most Latin tech entrepreneurs felt they needed to go to Brazil to grow and scale their businesses regionally. Brazil, with its +200 million consumers, was the big prize that venture capitalists valued. So entrepreneurs from the rest of Latin American packed their bags, convinced themselves that they spoke good enough “Portuñol”, and headed to Sao Paulo.
10+ years later most Spanish speaking tech entrepreneurs who moved to Brazil have come to realize the old adage that “Brazil is not for amateurs” is true. The reality is that most non-Brazilian entrepreneurs have not been able to succeed in Brazil (often due to cultural and political barriers).
The almost daily articles in TechCrunch, NYTimes, WSJ, and Medium confirm that Miami (along with Austin) has been discovered by the NY, SF & LA crowd. What is talked about less is that Miami has also been “rediscovered” by the Latin entrepreneurs and Latin facing venture capitalists. These Latinprenuers are arriving as fast as anyone else.
We need to remember that Miami was once “THE Latin tech hub” without equal. Before Brazil and Mexico, came dethroned Miami with the hearts, minds, and capital of the Latinprenuers. But that was 20 years ago.
What is talked about less is that Miami has also been “rediscovered” by the Latin entrepreneurs and Latin facing venture capitalists. These Latinprenuers are arriving as fast as anyone else.
In the late ‘90s, almost every Latin founder who raised $5M+ moved to Miami. The Lincoln Road promenade teemed with the likes of StarMedia Network, Yupi.com, Patagon.com, DeRemate, Viajo.com, eritmo.co, and El Sitio, while others, like Zona Financiera, Claxon, AOL LatAm, and Telefonica de España’s Terra Networks set up shop nearby.
Two decades later Miami continues to have distinct advantages for entrepreneurs and investors from Latin America compared to any other city in the US or Latin America:
Potential Corporate Partners
Over 150 multinational corporations like Microsoft, Facebook, Visa, Mastercard, HP, SAP, Western Union already have their Latin American headquarters in South Florida. Latin entrepreneurs are targeting these corporates for joint ventures and strategic partnerships. For instance, Latin fintech Yellow Pepper was recently acquired by Visa.
Business Friendly Environment
Miami boasts the most business-friendly tax and regulatory environment in the United States. Beyond Florida being one of only seven US states with no income or dividend tax, the local mayor Francis Suarez has turned his Twitter feed @FrancisSuarez into a business attraction engine. Mayor Suarez is constantly reaching out to entrepreneurs and businesses who are thinking about moving to South Florida asking “What can we do to help?”
Easy to Integrate
Miami is an easy city for Latinos to integrate into. Miami is a city of 2.8 million people. Per the last census, 2 million of its residents (70%) are Hispanic (broadly defined).
A Tech Community to Plug Into
As opposed to 20 years when Miami Beach’s Lincoln Road became the de facto capital of the Latin tech scene, Miami has spent the past 10 years building the infrastructure to support a tech community under the sunshine. Local organizations like Refresh Miami (@refreshmiami), the LAB Miami (@thelabmiami), Miami Angels (@MiamiAngelsVC), eMerge Americas (@eMergeAmericas), Endeavor Miami (@EndeavorMIA), 500 Startups (@500Startups), the Knight Foundation (@knightfdn) have been creating a community that now newer arrivals like TechStars, Plug&Play can tap into.
Pioneers like Demian Bellumio (@Bellumio), Matt Haggman (@matthaggman), Auston Bunsen (@bunsen), Michelle Abbs (@MichelleAbbs), Brian Brackeen (@BrianBrackeen), Felecia Hatcher (@FeleciaHatcher), Tigre Wenrich (@tigre_wenrich), German Montoya (@G3rm4nn), Andres Moreno (@talktoandres), Adriana Cisneros (@cisnerosadriana), Nancy Dahlberg (@ndahlberg), Nico Berardi (@nicberardi) and hundreds of other have invested the past 10 years to help foster the burgeoning Miami tech scene that is being “discovered” today by the city’s new arrivals.
[Insider’s tip: if you want to plug into Miami’s tech scene, just reach out to these ambassadors]
Part of the US Market, Yet Still Close to LatAm
And of course, Miami is a great entry point into the enormous US market, still the largest market in the world. And a market with over 60 million Latin consumers with a purchasing power close to the whole population of Mexico.
And at the same time, every capital is Latin America is short, non-stop flight away from Miami. Many of us have literally gone to Mexico City for the day. And I have never spent more than 30 minutes getting to the Miami airport—in São Paulo and Mexico City I usually budget two hours. Living is easy in Miami compared to every major city in Latin America.
I have said to many tech entrepreneurs from Latin America lately “Admit it: the love affair with Brazil is over. It was never that good anyhow. Come back to where you belong. Miami is waiting for you with open arms. Te estamos esperando con los brazos abiertos.”
[And in case you are considering moving, here is a recent article “Issues to Consider before Moving to the United States”]
This column was first published on LatamList and reposted with permission.
Juan Pablo Cappello, co-founder of PAG Law, was a partner in Patagon.com when it moved to Miami in 1999 before being sold to Banco Santander in one of the largest exits in Latin venture history, he is a founder of the LAB Miami and Miami Angels and can be reached at [email protected] . He also hosts a podcast on the TecnoLatino, “Aquí & Ahora”
Refresh Miami welcomes guest posts. If you have an idea for a guest post you’d like to submit, please email Nancy Dahlberg at [email protected]
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