Accessing Nearshore Tech Talent with Arin Sime of Agilityfeat
Arin Sime
CEO and Founder
AgilityFeat
arin@agilityfeat.com
LATAM FDI: Welcome to another episode of LATAM FDI’s series of podcasts dealing with issues that have to do with foreign direct investment in Latin America. We are fortunate to have a lot of expert speakers join us in these sessions, and today is no exception. Today we have, and I hope I get the pronunciation of your name right, Arin Sime. Arin is the CEO of AgilityFeat, a company that specializes in accessing nearshore tech talent. I’ll let you introduce yourself, Aaron. Could you tell us a little bit about your biography, and then a little bit about your company, if you would?
Arin Sime: Sure, I’d be happy to. So, you’ve nailed the pronunciation perfectly. I’m Arin Sime. I’m the CEO and founder of AgilityFeat. We are a software development and nearshore staffing firm in Latin America, serving clients globally, with a primary focus on the US and beyond. I’m from the US, but live in Panama City, Panama. I started this company in 2010. My background is in software development, and I have worked as an engineering leader, as well as an agile coach and trainer, helping companies implement software process methodologies, such as AgilityFeat. I began working with a business partner in Costa Rica, initially building technical teams for our clients in the United States. And eventually, I started working more, lived in Costa Rica for a little while, but then began working more broadly across Latin America. Eventually, I became a resident of Panama. My wife and I live here. We have an office in Panama City, Panama. We also have an office in Bogotá, Colombia. But we’re a US company. And so, we started as a software development agency and then began providing nearshore staff augmentation, helping US companies access nearshore tech talent in Latin America. Over the past 15 years, we’ve developed a substantial amount of expertise that extends beyond software development.
Today, we can also conduct technical recruiting, access nearshore tech talent, and provide staffing services beyond software development teams. This year, we have also launched a new model called our Build, Operate, and Transfer Model, which aims to help our clients leverage our 15 years of experience in Latin America, including setting up subsidiaries and handling hiring and recruiting ourselves. Our clients can now leverage this from us to help them set up their own centers of excellence and delivery centers in Latin America. Because the first time you do that as a US company and you want to do some cost arbitration, build up larger technical teams in Latin America, it’s a little intimidating how to do that the first time. This is especially true if you’re setting up a wholly-owned subsidiary. But there are a lot of benefits to that. And we’ve learned how to go through some of those hurdles ourselves. As a result of that, we can now share that expertise with our clients.
LATAM FDI: Why would companies consider nearshoring for software development in the first place?
Arin Sime: I’m sure your listeners know that nearshoring involves working with anyone in your same time zone, or in nearby time zones. In the software development industry, outsourcing has been a thing throughout my career. I can remember working in companies as a software engineer 25 to 30 years ago. We worked with talent around the world, sometimes from our office in the US and at other times remotely. But when you work with someone on the other side of the world, there’s certainly great technical talent available, but it’s tough to work across that many different time zones, right? So, geographic proximity is the first and most important reason that people consider nearshoring, whether that’s for software development, BPOS, or contact centers, really, any technical staffing. Geographic proximity is essential so that we can work together in the same or similar time zones and collaborate effectively. In software development, it’s a highly creative process that requires a lot of collaboration and communication to succeed. It’s nice to be able to speak with people throughout your workday. The other significant benefit, of course, is the ease of travel due to geographic proximity.
So, like I said, I’m from the US, but I spend most of my time in Latin America. I love traveling around Latin America. And the fact that Panama and Colombia, where we do most of our work, are so easy to travel to from the US. It’s a significant benefit not only for us, but also for our clients, as they can visit their team members or have team members see them in the US. Therefore, geographic proximity is the primary reason to consider accessing nearshore tech talent. But beyond that, the essential complements to that are the availability of talent and the cost of talent. In many industries, finding skilled technical talent with strong English communication skills is challenging in the US, and it is at least costly. The amount of available talent in places like Colombia is significant for our clients, and the fact that our clients can do cost arbitration across different countries. Even if they are working in further time zones, complementing those more distant remote teams with teams in their time zones in Latin America is a significant boost and a good way to balance costs across the company while still maintaining strong communication.
LATAM FDI: So, you touched upon this, but could you expand upon it a little bit further? To a greater extent, why did you choose Panama and Colombia, particularly when you have the entirety of Latin America to choose from?
Arin Sime: As I mentioned, I’ve lived in Costa Rica in the past as well. Costa Rica is another excellent location for accessing nearshore tech talent. I enjoyed living there. However, I went to Panama next, and we set up an office in 2019. One of the reasons I chose Panama was its reputation for being business-friendly. I don’t mean this as a knock on Costa Rica, but their primary aspects of their economy are tourism-related. In Panama, you’ve got the Canal, you’ve got banking. So, you have a much more diverse economy. However, you still retain many of the same benefits, including easy travel, geographic proximity, strong English skills, a close relationship with the US, and a business culture affinity, which is also essential. So that’s helpful. Panama has a visa program that was beneficial to people like me, allowing us to establish a business and obtain residency through it. Panama is very friendly for that as well.
Additionally, Panama boasts a robust tech community. We then expanded into Colombia as well, because it has an even larger community for accessing nearshore tech talent. It’s a much larger country than Panama, but it still has easy travel, a business-friendly environment, and strong English skills.
However, Colombia boasts a vast tech pool and a large community. You have certainly Bogotá and Medellín, but other emerging cities in Colombia are quickly becoming good tech hubs themselves, such as Cali and Barranquilla. I think they’re a good combination of everything that I like about working in Central America. Colombia, being in South America, is also closer to the United States, making travel easier. It’s easier for me, being from Virginia in the US, for example. It’s easier for me to fly to Panama than to California. That’s a significant advantage for our clients and me.
LATAM FDI: You mentioned Panama and Colombia in particular, but what’s the tech community in Latin America as a whole like?
It’s dynamic and exciting. A lot is going on. Latin America has had its unicorns, including some prominent tech startups. That is an excellent indicator of the strength of the tech community in Latin America. In Colombia, there is Rappi, a delivery service that is a significant employer in the country. It is an exciting startup. Argentina, for example, has Mercado Libre, which is a combination of eBay and Amazon for your US listeners, offering various services tailored to Latin America. These are some substantial tech companies that were founded in Latin America, primarily for the Latin American market, but they demonstrate the economic strength of the region. Additionally, you have AI centers. Of course, AI and software development are accessing nearshore tech talent. We talk about large language models, which is what AI, in a lot of ways, that we use that term, are made up of. This application development is significant in the software development community; it’s also vital in the business community as a whole because these applications are being used to build smarter, more AI-enhanced applications. Latin America is also becoming a hub for that type of work.
Chile, for example, is implementing data centers for that type of work, so that you have, because they’re very data-intensive and energy-intensive. There are places in Latin America that are looking to build data centers in an environmentally friendly way and distribute the workload of an AI application more globally. Additionally, other communities, such as those in Barranquilla in Colombia, have their own AI centers of excellence and are training their workforce to build and work with these types of applications. The tech community in Latin America is robust. I think if you name almost any major US tech company, they probably have an office in Colombia. Companies like AWS, IBM, Microsoft, Google, Accenture, Meta, and Facebook. They all have offices in cities like Bogotá and Medellín. That’s great for others who are looking at these areas, as it shows that there’s already strong technical talent there. And if accessing nearshoring talent in Colombia is good enough for Google, it’s probably good enough for your tech company as well.
LATAM FDI: Overall, we can say that over the last two decades, one decade, I don’t know, maybe you can clarify this for me, there’s been a trend towards Latin America developing pockets of technological excellence. Did things like the pandemic and the remote work culture that it spawned have any effect on accelerating things?
Arin Sime: Yes. There’s no doubt about it. When I started my career in tech 30 years ago, at the US company I was working with, we often brought people from other countries into the US and co-located them with us. While that remains common now, the remote work approach aimed at accessing nearshore tech talent has become a crucial aspect of the tech community and the tech economy since then. With the growth of fiber Internet connections in Latin America and high internet data connectivity rates, the region has undoubtedly opened up to remote work opportunities. As I mentioned, when I started AgilityFeat 15 years ago in 2010, we were first working with clients in the US. During those conversations, we had to convince them of several key points. We had to convince them that remote work was acceptable, as effective and efficient work could still be done with people who were not located in the office with you. We had to convince them that tech skills existed and that those skills were available in Latin America. We also had to explain terms like nearshoring to them.
What the pandemic changed, and we had to do that for years, the pandemic, because such a horrible event, of course, one of the benefits of it was that enforcing companies to allow more hybrid workforces and allowing people to work from home, it opened up a lot of companies to the possibility that you don’t have to have everyone in the office to do good work. That accelerated the trend of remote work in the US and globally. However, that also opened up companies’ minds to the idea that I could base part of my team in Latin America by accessing nearshore tech talent, and we could still work together as if we were down the street from each other, rather than on a separate continent. So that accelerated that. And even though, after the pandemic subsided, many companies have reverted to office-type initiatives. It is still very common for teams to work remotely. Even if they want those teams to work in an office in Latin America rather than from their homes, they’re still more open to the idea that that work can be done remotely. I think that has accelerated the trend in Latin America and made it a viable option for many people in Latin America to work in their home country, but how did you find the opportunity to work on really interesting work for major companies around the world?
LATAM FDI: From the discussion that we’ve had thus far, it’s clear that you have had some pretty expansive experience accessing nearshore tech talent in Latin America. However, over time, since you’ve been involved in this, can you identify any pitfalls with traditional outsourcing that exist for tech teams?
Arin Sime: Yeah, absolutely. Traditional outsourcing for tech teams, regardless of whether you’re doing it in the same time zones or not, whether it’s near shore in Latin America, if you’re a US or Canadian company, or if you are working with teams in a further away time zone, there’s still several pitfalls that people run into with this. One is that it can be harder to access nearshore tech talent in highly regulated industries. So, suppose you’re working in finance, fintech, health care, industries like that, where you have a lot of extra compliance that you need to be concerned about. In that case, data security, privacy, and regulations surrounding these issues can be more challenging in a traditional outsourcing arrangement because you don’t necessarily know where the personnel are located. You don’t necessarily know where they’re working from or what devices they’re working on. They might be in a cafe, or they might be in that company’s office, but it’s probably not a device or on a network that you control. That can be particularly challenging in highly regulated industries. Likewise, suppose you’re doing outsourcing in a way where you have contractors spread across many countries accessing nearshore tech talent, as many companies do. In that case, you have to worry about things like labor compliance in multiple countries.
And so if you have five programmers in five countries, that’s five sets of laws you need to be worried about. That’s hard to deal with. And then, of course, outsourcing can also lead to vendor lock-in. If you’re working with a company that is providing a large portion of your tech staff, it’s hard to change that relationship with them because you’re dependent on the people that they’ve provided to you. Also, when they’re working in another country, you may be worried about IP protection, your intellectual property. How do you ensure that’s protected when people are working elsewhere? Those are all challenges beyond how we communicate with everybody, and how we hopefully see each other in person occasionally to build on those relationships.
LATAM FDI: In a general sense, can you tell us what the pros and cons of establishing a tech presence in Latin America are for your company or for any company to engage in accessing nearshore tech talent?
Arin Sime: Yeah. So, a lot of those pitfalls that you could run into that I just mentioned can happen when you’re doing a more traditional outsourcing agreement or staff augmentation agreement. In our case, we’re a US company, and so our clients don’t have to worry about that quite as much. But they may still want to have, if they’re in one of those more heavily regulated industries, they may want to have that extra control over the devices people are working on, where they’re working, the policies that they follow, the networks they work on, all those things, whether they’re a team of software developers or a contact center for a health care institution, any of those scenarios, this applies. A significant benefit to organizations is establishing their physical presence in Latin America, which involves setting up a subsidiary that they own and control. This allows for complete control over implementing all necessary measures for accessing nearshore tech talent. You can ensure that everybody works in the office on a highly secure network, or you can allow them to work from home or in a hybrid environment under specific conditions. You can make sure that they’re working on your company devices.
So that is good. In addition, you’re getting additional lower costs. If you work through us as a staff augmentation for it, then, of course, we have our margin on top of what we pay our team members. And if you control that subsidiary yourself, then that opens up the possibility of you having lower costs as well. Those are some of the advantages of setting up your own tech subsidiary. And that’s why we can help some of our clients move from a staff augmentation model to owning their own operations in Latin America. However, there are some drawbacks to doing that as well. It’s hard to set up a new legal operation in another country when you’ve never done that before. You’re unfamiliar with the local business customs. You are unfamiliar with the regulatory environment. You are not familiar with the vacation policies or the compensation for full-time employees. How are bonuses handled? How are sick leave, maternity leave, and paternity leave handled? All of these factors vary from country to country. Often, I have found that in Latin-American countries, these policies tend to be closer to each other than they are to the way, say, US employment law works.
And so that can be a pretty big learning curve if you haven’t done that before. So that’s a disadvantage of setting us up. Essentially, that’s where we provide value to our clients: we’ve already learned those things. We have local legal and accounting teams in these countries that can assist with that and manage it on your behalf. People whom we trust are with us. And so, that reduces a lot of the difficulty around establishing and learning to run these operations, while still providing the other benefits I mentioned, such as lower costs and higher control over your operations.
LATAM FDI: When companies first come to you looking for advice, what do they typically want to know about setting up shop in Latin America?
Arin Sime: Yeah. They want to know about costs. They want to have a sense of the cost savings that they might achieve when accessing nearshore tech talent. And that varies a lot with the type of operation that they’re doing, the country that they’re looking at, even within that country, the city or region within that country. Colombia has multiple great cities, distinct tech regions, and varying costs associated with them. Working with a local partner offers a significant benefit in understanding the differences between those regions, not only in costs, but also in aspects such as the quality and type of talent available in each area. One city may have more education around AI-driven applications. Another city may be more suitable for, say, a contact center, a BPO process, and so on. Then, some of the things I hinted at in the last question, regarding benefits and the complexity of labor laws, or at least the differences in labor laws between those regions in the US. They want to make sure that they understand that, so that they know what the rules are around hiring people, what the rules are when you have to let people go, voluntary or involuntary.
There tend to be more vacation days and more holidays in Latin America. How is that handled? And how do you understand those sorts of differences? A lot of that, we know ourselves. Additionally, for more detailed conversations, we have tax and legal partners in each of these countries that we can also bring into the conversation.
LATAM FDI: Well, looking at further growth down the line, how can Latin America continue to attract foreign direct investment? And how can they continue to grow upon the base of the tech labor force that they already have?
Arin Sime: I think a lot of countries and regions in Latin America are doing a fantastic job of this. I’m from the US. I love working in Latin America. My team, my leadership team, is primarily from Latin America. However, as someone who is not from Latin America myself, I want to be humble in suggesting how others should run their countries or attract foreign direct investment. However, I believe there are many great examples available. Colombia has invested significantly in workforce education and technical universities. We try to capitalize on this by partnering with local universities in Panama and Colombia to attract younger talent. Additionally, we hope that they benefit from seeing a perspective from the industry about what skills we and our clients value most—so having a close relationship between private sector, both internal within these countries, as well as foreign companies and companies like ourselves, that bridge that gap between a US company and, say, a Colombian entity. Having close relationships with those sorts of companies, I think, can give a lot of insight into specific details of workforce education that they can invest in.
Continuing is important. Establishing public-private partnerships for events is crucial. I think it’s great. There are numerous significant tech events in Colombia, for example. One thing I enjoy seeing in those, and I would encourage others to do the same, is to ensure that they’re bringing in international speakers to those events. So, some of the great tech events I’ve been into at Colombia have a combination of speakers from the local Colombian tech community, and that’s great for them to get up on stage and to share all the expertise that they have, as well as bringing in speakers from tech companies in the US. And that’s a good in both directions, right? It helps to bring some of that international perspective to the Columbia workforce, which might include those attending the conference. Additionally, it’s suitable for US speakers to have the opportunity to join a tech conference in Colombia, see the diversity and wealth of talent in these countries, and witness the excellent work they’re already doing. And so, then they get to go back to their company in San Francisco in the US and be able to spread that word as well and say, I was in Medellín, and I was at a great JavaScript conference, and there’s an excellent tech community there.
We should be looking at more, too. It’s a two-way street; I believe encouraging international collaboration at events like these is essential. And then, of course, in our community, we talk a lot about AI. At our company, we develop AI-driven applications, but that requires a different type of technical skill. I think the other thing that I would recommend in general, and countries in Latin America are already doing this, I mentioned data center initiatives in Chile, AI centers of excellence in Colombia, for example, but encouraging them to continue to get ahead of the curve on AI-enabled workforces because it’s undoubtedly something that regardless of the country we’re from, all of us face in the workforce and that changing dynamic in the workforce. The more they can incorporate that into university education, the more beneficial it will be for their workforce in the coming years.
LATAM FDI: Well, we’ve covered a pretty good expanse of information over a relatively short period. One of the things that we commonly experience with our podcast is that people, after listening to the discussions, have questions. How would anyone with a question get in touch with you to get an answer?
Arin Sime: Yeah. I’d be delighted to hear from any of your listeners. You can find us at www.agilityfeat.com. This is our corporate website. You can also find us, AgilityFeat, on LinkedIn and YouTube, and contact us through there. Or you can find me on LinkedIn. Again, my name’s Erin Sime, A-R-I-N-S-I-M-E. And look me up on LinkedIn, and I’d be delighted to speak with you as well. So, yeah, I enjoyed the opportunity to speak, Steve. Thank you.
LATAM FDI: Well, what we’ll do to make things easy is we have a transcript section of the podcast. In the transcript section, we’ll include a link to your LinkedIn page. We’ll have your website. If you’re interested, please send me an email later, including a phone number if possible, and we’ll proceed accordingly.
Arin Sime: Sure. Absolutely. Okay? Absolutely. Thank you so much. I appreciate it.
LATAM FDI: Well, it’s been an interesting conversation. Have a good afternoon.
Arin Sime: Thank you for inviting me to record this podcast. I’ve listened to a lot of them, and I’m learning a lot myself from all of the wonderful people you have interviewed. So, it’s been an honor to be a guest on it as well. Thank you.
LATAM FDI: Well, thank you for that.
