Starting A Business In Ba And Permanently Moving There

[Godforce]

Hello BAexparts,

First of all I would like to congratulate everyone for the amazing support and information you have posted here and for helping people as myself by making their transition easier.

My name is Andrew (Andrei), I am from Romania and, together with my associate, we plan on bringing high speed internet in Buenos Aires. We have been involved in the telecom industry for over 10 years now and we would like to open a branch of our company there, but a standalone company, not a branch per se.

I have been reading the forum for the past three weeks and I have gone through pretty much all the recent topics. Should the plan of opening the company become real, I will move to BA with my fiancee for at least 5 years. The plan is to actually not move back at all to Romania, and to make a life in Buenos Aires, since the city seems to offer everything we desire in terms of personal preferences and business opportunities (which means friendly people, surfing, good food, things to do and see culturally, and overall a reasonably relaxed life while we can grow our business and enjoy life).

I noticed that the economy is not spectacular and inflation is a problem. I also noticed that employment is low because, as a company, the taxes are high and everything seems to be expensive. That is understandable, considering the turmoil Argentina has been through and the lack of political leadership required to steer the country in the right direction.

We believe that the city (and country) would definitely benefit from a higher internet speed and the associated infrastructure. My question is: would you be interested in high internet speed? Do you believe businesses require better internet speeds? Just to have a clear idea of what I am saying, the medium speed we will be selling will be 100 Mbps, the lower speed will be 50 Mbps, going to 1000 Mbps on the upper pricing level. These are real speeds, not just speeds on paper and in reality you grow old trying to load Google. Romania is in the top 3 countries in the world regarding internet speed.

Also, I found it difficult to contact companies who can facilitate our registration for the company. The only company I found is requesting around 10 000 USD - 12 000 USD for the registration, around 4-6 months for the registration, and another 2500 USD per month for the legal advice. This is completely unacceptable, as from what I noticed by studying the laws in Argentina, the process of registering a company is very similar to ours, and here the cost is around 200 USD and it takes 3 days. Can anyone recommend a reliable company we can talk to about the legal registration? Also, a reliable accountant would be welcome.

I also noticed mixed feelings regarding the living costs and conditions in Buenos Aires, which is normal and understandable. Considering it is such a big city, some will feel better with the commotion and diversity, while others will not be comfortable. It is the capital of the country, and it is normal to be more expensive compared to the other cities. And also more crowded and diverse in all ways possible.

I have a lot more questions, but I don't want to be impolite.

Regards,
Andrew

 

[Girino]

I'd love to have a business like yours here, however if you believe in free market, you are in for a big disappointment in Argentina.

 

[Gringoboy]

The best of luck to you, but quite how you're going to roll out that kind of service I'm not really sure. I'm all for competition and this country certainly needs more, but you will be in for a battle.
I'm assuming you're talking Capital for the moment and also that you've done your research as to who the major players are...Fibertel, Telecentro etc.
I also hope you have balls of steel, because you're going to need them.

 

[steveinbsas]

I found it difficult to contact companies who can facilitate our registration for the company. The only company I found is requesting around 10 000 USD - 12 000 USD for the registration, around 4-6 months for the registration, and another 2500 USD per month for the legal advice. This is completely unacceptable, as from what I noticed by studying the laws in Argentina, the process of registering a company is very similar to ours, and here the cost is around 200 USD and it takes 3 days. Can anyone recommend a reliable company we can talk to about the legal registration? Also, a reliable accountant would be welcome.

If you want to move to Argentina and start a business in Argentina you will first need to qualify for a visa to live in Argentina. I can assure you that will take more than three days. You would be able to qualify for an investor visa if you invest enough money in Argentina to get one as well as jump through all the other hoops required by migraciones. You can't just waltz in and start a business.

I'm not sure of the current investment requirement but the last figure I heard (or read about) was $150,000 USD. You might be able to find a lawyer who can facilitate both the process of getting the residency visa(s) as well as the process of registering the business. It won't be cheap.I think you will also need an Argentine to be one of your corporate officers. (perhaps a partner).

I just saw that Fibertel was offering an internet speed of 25 mps. I live in "el campo" and have wifi service that is less than 5mps. That may sound very slow, but it's much better than it was a few years ago, when I was using a USB modem.with service provided by CLARO. My house is very close to the AIRE58 transmission tower that was erected about four years ago). I dropped my cellular plan with CLARO and now use WhatsApp for all my calls.

Live streaming of sports events would be problematic at the speed for which I am now paying just under $500 per month, but since I don't watch any it's not a problem. I can watch movies in HD on YouTube without any buffering. Google loads almost instantaneously.

It would be interesting to know what kind of "infrastructure investment" you are referring to and also why no Argentine company has yet to offer the speeds you would like to provide. I also wonder how much "resistance" you might encounter by established providers already doing business in Argentina.

PS: Please keep in mind that you will have to provide the provenance of any funds you want to invest in Argentina as well as a criminal background check from any country you have lived in for more than twelve months (in total) during the past three years,

 

[Ries]

I have known a few people who have moved to Argentina and started businesses.
Its perfectly possible.
But you have to adjust your expectations to the country.

Usually that means moving here first, getting to know the people, the country, and its exceptionally slow and complicated bureacracy.

You will not be able to just drop in, and be up and running in a few days.

A realistic approach would be living here, full time, for six months to a year, before expecting your first, small scale business to be discovering its potential problems.

Argentina is not Romania, or the USA, or China.

Its a unique, wonderful, and horribly complicated, place.
You will not be able to do this long distance.

But it could work, if you really do know what you are doing, and your business model can survive Argentine rules, customs, taxes, and time honored ways of doing things.

 

[Godforce]

Hello again and allow me to thank you all very much for your amazing replies. I really appreciate it, thank you!

I would like to address each point raised by every one of you, as follows:

Serafina: the concept of free market is really just an economy theoretical concept. In reality and in the business world, every business is trying to push in order to create a monopoly in a certain niche. Doing business with the concept of free market in mind is not only idealism, but one will be very likely to fail. I appreciate your optimism for the business, yet a business like this is like working in the ER of a very busy hospital, full time (at least in the beginning, when you have to bootstrap and take care yourself of a lot of specialized work but you cannot hire people to do it for you, because you have to identify the problems you will be explaining to your future employee). We constantly receive phone calls at 4-5 am because some backbone or transporter has failed, and even with our backups in place, it still happens. It is not our fault, but customers can't see that. And we have to deal with those issues at 4 am Thank you very much for taking time to reply to me

Gringoboy: thank you for your message. Yes, we are thinking about BA to start with and expand towards Cordoba, Santa Fe, Mar de Plata and Rosario, in time. It really depends on how things will evolve at ground level. Right now, what I'm saying is just wishful thinking. I did research the major players (and the minor ones), it's part of the due diligence process. Also, you need balls in business in general, not just telecom. I am more interested in what you mean by needing balls of steel in this regard: do you have anything specific in mind? Thank you for your reply.

Steveinbsas: we are very comfortable with bureaucracy... I don't know exactly what you know about Romania, but in terms of bureaucracy, we are a former communist country. This means that everything, and I mean everything is subjected to a long process of going back and forth to state agencies, greasing the wheels (if you know what I mean) and it's an arduous mental process in itself that affects all businesses in a negative way. Pertaining the visa, I can set that up directly in my country, so that is not a big concern. Regarding the 150k $ amount for investment, that is well within our range in the business plan.

Regarding the costs, I am not expecting to be the same as in Romania, but I found that 10k $ for the company registration to be on the extreme higher end of what we were thinking about. We plan on making a trip to BA by the year's end (we are going to Lima first, that is also on our radar) so that we can talk directly with companies that can facilitate the legal process for us.

Pertaining the speeds, I am interested in the cost you said: 500$. Are these US dollars, as in 500$ ~ 8670 Argentine pesos? For 25 Mbps? I am asking this because I noticed that there is a peculiar denomination in prices and I've seen prices expressed with $ at the end, but they were actually pesos. In our view, Internet should be as normal as water or electricity... not a rare and expensive commodity as we have seen it around the world. 50 Mbps should be on the lower end, and everyone should afford it in their home. What goes above 200-300 Mbps should be for business and what is over 500 - 1000 Mbps should be for specific business needs. In other words, you wouldn't have to think about buffering for any type of content whatsoever. Moreover, we usually provide the first month free for our customers and subsequent free months when they recommend us other customers and they sign up.

Regarding the infrastructure, over time we have developed a specific infrastructure development protocol which enables us to not only provide constant speed, but also redundancy (backup). So if a part of the network fails, there are other parts which take over the service and you won't notice. So problems would arise for the end customer only if there is a glitch on the transport side or the backbone. Regarding the technology, we use expensive equipment. It's not a secret, but it's really costly. And 90% of providers don't use this type of equipment for two reasons: the setting up needs a lot of fine-tuning, which in turn requires specialists; basically with a single 50 000 USD piece of equipment you can have spectacular speed or really lousy speed if you don't configure the network properly. This requires expertise. And that piece of equipment will serve one, maybe two medium clients. Let's say three. When you think about it, that amount is big for such a low amount of customers. But it makes up in time that is not lost in going back and forth to the customer and solving problems.

In terms of resistance, as Serafina said, it's a free market. We are well aware of guerilla tactics that are being employed by companies usually, ranging from direct action (cutting wires, messing up antennas, flooding or DDos's) to more obscure action (paying public service people to get in your way with authorizations or fines). We have been through that

And finally, regarding the investment funds, everything is perfectly clear on company records. There is absolutely no problem in this regard.
So wow, thank you very much for your extensive reply, I really appreciate it. My biggest pain right now is to find a local company to start the process of registering the company and getting the information. I can't seem to find anything on Google, and I've searched in Spanish as well, not just English.

Ries: thank you for your message. Our expectations are really really low. We are not "heroes" . We are not thinking that everything will be set up in a couple of months and we will start doing business immediately. Exactly as you said, the plan is to identify a local area (ideally a business area) where people really need better internet speed for the correct price and customer service and start from there. We are not really dreamers, we have been doing business for a while now and we know 90% what to expect. Our time horizon is just as you said, around 6-9 months.

Now, let me tell that regardless of where you are (whether it's Romania or London), bureaucracy is a pain, a constant pain. In London, I created the company in 3 hours, but it took a long, long time to get approved by a bank and open a business account. So there are quirks and glitches everywhere you are. Another example: Australia. One can't even go there unless approved by a state governance committee or invited there to do business. The US, wow ) There's such a huge monopoly on internet there that it's scary just to start thinking about it! We are talking about govt level agreements between the ISP's and govt members.

Finally, the strategy is to do things at the local pace, with a small push from us. We have been through pretty much all the phases of bureaucracy and wheel greasing scenarios, and we expect that everywhere. When it comes to people in positions of power, it's normal. No, I didn't even think about doing this long distance, it's out of the question. My personal plan is to meet and know the people whom I will be doing business with. That is how I go about doing things. The real, genuine connection, the loyalty, these are the things that create a strong business in the long run. Again, thank you for your message.

Thank you all for your replies and help, I really appreciate it. I wish you all a lovely weekend!

 

[splaying]

Romania is a wonderful country. I have been there a few times... and as recently as a few months ago ... I returned to many of the same places as previously so I could show a friend these locations. I drove throughout the country. I spent some time In Iasi, Romania. I have developed some friends in that area in the medical profession. We got together to share conversation, eat a little and share a few beers. It was a wonderful reunion.

I hope you will do fine in Argentina. I wish you my very best. You come from a wonderful country. I am sure many others here on this site have never had the opportunity of visiting your fine country. It would be well worth their while to do so and the costs of traveling in Romania are very little indeed even in their fine capital of Bucharest.

Welcome to Buenos Aires and to Argentina as a whole too.. I sincerely hope your dream is realized in this fine country of Argentina.

Walt

 

[Girino]

I think the hardest part would be entering and dealing with a market made of companies which are closely connected with the public entities involved. Also, infrastructure here is underdeveloped and under maintained. Buenos Aires infrastructure didn't keep up with the increasing population and power cuts are a common thing in certain areas of the Capital. Part of it is also due to careless consumption of electricity as it has been heavily subsidizes for a decade (and more), so for 2-3 USD a month a family could use a lot of electricity, left the AC full blast on, etc. now the subsidies are gone and the electricity bill has risen, though still lower to electricity in Europe, for example. We had a thread on electricity bill increases after the subsidies were removed... I can't find it from my mobile.

My understanding is that if you are relying on other's supply (of electricity, of network either cabled or wifi) you aren't really 100% in charge of your operations.

There is a company providing super high speed for businesses but it is not available in my area. I can't remember their name.

Anyway, just come and give it a try. I like your 'can do' attitude! Maybe I'll drop my resume sooner than I know! ;-)

 

[Ceviche]

God Force

Argentina is full of multi millon dollar making opportunities. Only blind people can not see them. Sometimes, I wonder how can people NOT see them!!! You are on the right track. Welcome to Argentina.

 

[camel]

I think I've heard of this