For Latin America, the transforming work landscape means increased investment in tech education, software developer training, and a bustling start up culture. These transformations led to a Latin American tech ecosystem that’s captured the world’s attention.
The tech industry in the U.S. has outsourced to other regions since the early 2000s. But something happened in Latin America that has now become apparent. As the LATAM tech ecosystem grew and outsourcing to other parts of the world fell out of favor, foreign investment looked to the region and noticed something extraordinary: Latin America was having its own tech revolution.
So how does this impact U.S. companies searching for tech talent? Let’s take a look at some of the numbers.
The Growth of LATAM as a Top Destination for Hiring Software Developers
The vast region of Latin America has thirty-three countries. Some of the biggest countries in the region include Brazil, with a population of 212.6 million, Mexico with 128 million, and Colombia with 50 million people.
Until recently, the economies of some of the larger LATAM countries were largely dependent on traditional industries like mining, agriculture, and low-cost manufacturing. In the past decades, however, some of these Latin American nations made a push to develop their technological industries to attract foreign and local investment.
The drive to increase technological development worked. In the past, the region became a preferred spot for attracting venture capitalists and their investments in burgeoning tech companies. The year 2021 was especially surprising as the region saw an extraordinary uptick in funding.
How Increased Venture Capital Investment Fueled the Latin American Tech Ecosystem
According to Crunchbase, the LATAM region was the fastest-growing in the world for venture funding in 2021. The region saw about $19.5 billion invested via venture and technology growth investors. This increase skyrocketed in 2021 but had been steadily growing since 2015. The reshifting of economies during COVID likely played a role in LATAM’s rapid rise to a top investment region.
There are also other reasons for increased interest in the region. As the Wall Street Journal reports, much of Latin America has experienced a rise in venture capital thanks to a growing middle class demanding new financial and information technologies.
According to the Journal, venture-capital firms raised about $1.65 billion through 17 different funds in the region. The increase in investment is driven by a young population that seeks to circumvent insufficiencies and bureaucracies in the current infrastructure and use technology to make everyday life easier.
In other words, people are seeking solutions through technology. They want apps, programs, and devices that help make everyday life easier and more convenient. For example, KAVAK, a growing Mexican startup provides a 21st-century solution to buying a used vehicle in a popular market. These types of solutions increase demand, accelerate competition, and drive innovation.
The investment interest in the region doesn’t show signs of waning, as another $5.4 billion poured into the region in the first half of 2022. And even despite rising interest rates and other economic shifts, the region remains a strong contender in attracting investment and producing top tech talent. The region continues to increase participation from foreign investors, a growing pool of talented and experienced entrepreneurs, and widening market opportunities.
About five years ago— in 2017— LATAM only had two unicorns. By February of 2022, that number had risen to 42, with Mexico housing at least seven of them. In August of 2022, Forbes Mexico reported that Mexico was the third best-positioned LATAM country for startups and investment. The increase in startups and tech-driven solutions gave way to what The Economist called Mexico’s startup bonanza.
With Growing Investment Comes Elite Tech Talent
A tech ecosystem is self-perpetuating. Mexico is a great example of how a tech ecosystem develops over time. As investment rolled into the region, a new class of startups and creative entrepreneurs emerged. The Mexican government and educational institutions invested in generating a pool of world-class talent that would attract further investments and forge a strong culture of innovation and open up the tech industry.
U.S. companies have noticed the level of talent present in LATAM countries like Mexico. Foreign investment is nothing new there, of course. Large companies—such as Motorola and Hewlett-Packard— have had a presence there for decades, sowing the seeds for Mexico’s tech hubs.
That’s how several major Mexican cities became tech hubs, by establishing growing communities of developers, elite educational institutions, and providing on-the-job training for graduates.
Why Hire Latin American Software Developers?
The changing work landscape has made hiring Latin American software developers a promising prospect. Companies in the United States find world-class talent and can hire on a project-by-project basis, integrate a remote team, or acquire permanent members of their development team.
Our Tech Salaries Report 2022 takes a deep dive into the unique aspects of the Mexico tech ecosystem and characteristics of Mexican developers.
What are the advantages of hiring a LATAM developer?
- Find highly-trained developers with high English proficiency. In Mexico, at least 45-50% of the IT population has an advanced English level and 35-40% have an intermediate level.
- Mexico has an expansive talent pool. When hiring in one of its many tech hubs there is an abundance of every tech role available including full stack developers, back end developers, front end developers, and more. Similarly, there are senior developers, intermediate developers, or fresh graduates.
- The country has several elite educational institutions which graduate 130,000 software developers every year.
- Remote work allows Mexicans to work for international companies, earn a lucrative salary, and avoid having to relocate.
- Lower rates of developers salaries compared to the U.S. In Mexico, the cost of living is significantly less than in the U.S., which means companies can hire elite talent at a fraction of the cost of hiring remote developers in the U.S. Get an idea of how much it would cost you to build a remote team.
- Companies have several options when it comes to hiring a LATAM developer: short-term hiring, long-term engagements, staffing a nearshore office, establishing remote teams, or scaling a company, etc.
Remote Work in Mexico and Latin America
Just like in the U.S., remote work in Mexico increased after COVID. Our surveys showed that 90% of workers that worked remotely during the pandemic prefer not to return to the office. As early as 2019, statistics showed that Mexico was one of the top three LATAM countries implementing remote work. In late 2021, Mexico still had one of the highest percentages of teleworkers as compared to the rest of Latin America.
This ability to implement remote work means that companies looking to nearshore and hire remote developers in Mexico have a vast talent pool from which to choose.
How CodersLink Helps Companies Maximize Innovation with Top-Level Talent
CodersLink works at the center of the Latin American tech ecosystem— with a trusted network of over 20,000 software developers in Mexico. We help companies connect with the right candidates for the job. We offer staffing and recruitment services for companies that might want to establish an entire team in Mexico, scale their companies for growth, or establish a satellite office.
We do the logistical heavy lifting so you can focus on growth. Want to learn more about what we do?
