You can now find the full show notes of the Crossing Borders podcast on LatamList.com’s new podcast section. I’ll still post the audio of the podcast on my blog and I’m planning to start writing more again on my blog, like I used to.
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Thanks for listening to Crossing Borders all these years! If you have any feedback or questions, please feel free to reach out here, or contact me on social media.
Outline of this episode:
- [1:40] – About Brian
- [3:58] – From merge to exit
- [7:45] – Merging with a competitor
- [12:11] – Advice for companies looking to buy instead of build
- [14:58] – How the ecosystem has evolved since 2009
- [17:00] – Brian’s latest book
- [21:22] – Angel investing in Latam with Latitud
- [27:00] – Do’s and don’ts of investing in tech
- [34:00] – Where do you see the market going?
- [36:43] – Advice to Brian’s younger self
- [39:25] – Next steps for Brian
Show notes on Latamlist.com.
Even in the United States, the process of finding and buying property, as well as securing a mortgage, is not an easy one. In Latin America, where real estate agents are often not officially licensed, countries use notaries instead of escrows, and mortgage rates can be staggeringly high, buying a property in Latin America can be much more difficult. Most Latin American countries lack an MLS (multiple listing service) so there is no central place to search for properties, no exclusivity for brokers, and prices for the same property can differ from broker to broker. It can be hard to know whether you are getting a straight deal when the process for researching properties and brokers is anything but transparent.
Even in countries such as Chile, which is one of the more developed real estate markets in the region, renting an apartment as a foreigner can be daunting. Local landlords usually require significant paperwork before signing a lease, including a cosigner, local employment documents, proof of local taxes, and other documents most foreigners do not have. Landlords may also require your monthly income to be triple or quadruple the monthly rent, meaning that renting many properties is out of reach even for well-paid locals.
In 2013, Vijay Kailas, a fellow Start-Up Chile entrepreneur and I started Andes Property to help foreigners buy, rent or invest in properties in Latin America to help provide more clarity into this market. In 2014, my fund, Magma Partners, made Adrian Fisher’s PropiedadFacil our first investment. Adrian has been involved in the real estate tech sector since 2012 in Argentina, Chile and now the US with PropertySimple, so we had significant experience in the real estate tech sector.
Because of a lack of information, low levels of competition in the Latin American real estate market and corruption in certain markets, potential property owners can take on risks when buying a property that they wouldn’t otherwise take on in the US, where we take many of our existing systems and platforms for granted.
Brazil is the fifth largest country by area in the world and the second most populous in the Americas behind the United States, boasting a population of more than 200 million people. This population is largely middle class and based in urban environments, which creates a consistent demand for new goods and services, despite Brazil’s roller coaster economy, high regulations, seemingly endless political scandals, high taxes, and notoriously difficult business climate.
As one of the most challenging places to do business in the world, operating a business in Brazil is no easy feat. But for companies that do take the leap, capturing a piece of this incredibly large and tech-savvy consumer base can be the ultimate prize for anyone doing business in Latin America. There are many opportunities for entrepreneurs and investors to generate Silicon Valley style returns for those who enjoy take risks and are willing to slog through Brazil’s ecosystem.
Here’s an overview of the current opportunities and challenges of doing business in Brazil today. (more…)