Updated: May 14
Too good to be true?! Or simply both true and good, and getting better! More and more globally recognized investors are saying the same thing, that Yes, Spain is a mature market, and Yes, there is so much talent here, both tech and creative, to be found.
The amount of times I have heard the words "mature" and "startup ecosystem" in the same sentence, from Spanish and international entrepreneurs alike, talking about the tech startup scene in Spain, have sky rocketed. The main Spanish startup hubs (Madrid, Barcelona, Valencia, Malaga, Bilbao) are now confirmed to be "grown up" ecosystems.
Mr Niklas Zennström, Atomico VC, Do you plan to make more investments in Spain?
"I come to Spain every year, and every year I go with a better feeling, because the level of ambition of the projects is increasing and the level of entrepreneurs is also increasing, so I am sure that we will make more investments in the country."
- Niklas Zennström, founder of Skype and Atomico told Conco Días while in Madrid to attend the South Summit, October 2019. Previously Atomico has invested in Spanish Fon, JobandTalent and Ontruck.
Is talent acquisition in Spain too good to be true?
As we all know too well, the saying "too good to be true" exits for a reason. When you hear that you can employ highly skilled technical talent for a fraction of the cost in comparison to not just other hubs in the US, but also in Europe, you rightly so get suspicious.
You probably assume that while the cost for hiring might be lower, the quality - following the basic laws of economics - must simply be lower as well. But, in the case of Spain it is wrong, and, for now anyway, what might be too good to be true is both true and good, and becoming better!
Spanish talent becoming more aware
While access to technology professionals, and to other profiles in high demand for startups, is becoming one of the main barriers to growth in many countries, Spain has an easier time filling these vacancies today. Although, this might quickly change as good news travel fast and the elusive talent is more and more aware of their value, as they should be.
For an increase of international startups, a strong reason for choosing Spain as a next market to expand to spells T A L E N T. When measuring the difficulty in finding ICT specialists (Information and Communications Technology) among European companies overall, only 17% of Spanish companies said it is a problem, versus 46% on average in the countries analysed for this comprehensive report (July 2018), 100 reasons to invest in Spain.
Less pronounced war for talent in Spain
Peter Specht, Venture Capital firm Creandum, has taken a closer look at the Spanish tech ecosystem from an international perspective and writes in this blog post in November, 2018:
"Less pronounced “war for talent”. Comparing to London, Berlin or San Francisco, where the demand from startup is even higher and you have tech giants like Google, Amazon or billion dollar “startups” paying salary levels for engineers that are hard to compete with."
A more peaceful recruitment process is a fact that persuaded Cristóbal Viedma, CEO and founder of Lingokids, to take his company to Spain from San Francisco in 2016:
“In San Francisco we were competing for local talent with the likes of Uber and Airbnb. I'm from Madrid myself and knew what great talent we have in Spain so we decided to go here.”
The access and high quality of this crucial startup commodity comes up every time in the replies from international startups with subsidiaries in Spain.
Marc Miralda, COO for Swedish born TechBuddy, with an office in Barcelona, comments:
“Because of the access to Spanish talent, we saw a great opportunity to create jobs within the Gig economy for people that are passionate about technology.“
Relevant education and experience to be found
The same report above also claims that "Spain scores higher than the OECD average and above major European countries, with the exception of Germany, in terms of percentage of ICT graduates over the total number of graduates."
When it comes to relevant experience, the report further states that:
"In terms of the availability of human resources with training and/or experience in science and technology, Spain ranks 4th in the OECD, following a 18% increase since 2007."
Furthermore, also from the mentioned report, it says that:"in the international rankings, three schools (IESE, ESADE and IE Business School) are consistently among the top in Europe and in the world in the most reputed rankings. Spain ranks 3rd in Europe and 5th in the OECD for quality of business schools according to the WEF27."
Spain’s work-life balance attracts and retains top talent
The increasing international competition forces the need for identifying more attractive factors than the obvious compensation of the salary package and the strong local ecosystem that need to be in place. One core feature to attract and retain talent, sometimes overlooked in the comparison between the leading startup hubs, is the quality of life.
According to the OECD Better Life Index, Spain gets a high placement in this regard:
"A country’s quality of life plays a fundamental role in driving investment location decisions, as well as the attraction and retention of talent.
Spain’s work-life balance is one of its main attractions. Among its OECD peers, Spain’s attainable work-life balance ranks 4th."
But great news are known to travel fast as the intensified search for startup talent continues. Peter Specht, Creandum, "warns about" that in his above mentioned blog post:
"Yet we currently see Barcelona and Madrid getting more competitive, with rising salaries, due to well funded startups (e.g. Glovo, Jobandtalent, Spotahome) and international ones setting up outlets there (e.g. N26, Xing)."
So don't wait too long with taking your market expansion decision to Spain, as more and more founders and investors are learning about this golden opportunity to secure the most essential resource of all: Team members to build your vision for a world-class company.
Covid-19 Pandemic Update, May 14, 2020:
International VC Target Global shows a continuous belief in the Spanish tech talent Investment director, Lina Chong tells Techcrunch:
“Clearly Spain has a highly entrepreneurial spirit. They’ve come out of the last crisis… with a very ‘we make our own reality’ view of the world. And I think the same will happen in this crisis (...)”
The VC firm is allocating €500,000 to support Spanish tech entrepreneurs now without a job due to the pandemic. Spanish Startup founders of AlienVault, TravelPerk, Badi, Adyen and Jobandtalent contribute with additional €500,000.
Did you find this interesting? Do you agree? Or disagree? I so love an interesting conversation and would love to hear your thoughts. Please do leave a comment!!
Crafted by Caroline Lagergren.
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