May 21, 2025 • 23 mins
In this episode of The Nearshore Cafe Podcast, host Brian Samson, founder of Plugg Technologies, sits down with Jared Andreassen, executive at Blue Coding, to break down the Build-Operate-Transfer (BOT) model—an emerging strategy reshaping how mid-market and enterprise tech companies scale teams across Latin America.
From setting up entire operations in Mexico City and Bogotá to navigating employee severance laws in LATAM, Jared shares tactical insights, real-world stories (including a wild rafting trip in the Dominican Republic), and a sharp perspective on the evolving nature of global tech hiring. If you're exploring Staff Aug vs BOT, managing burn, or planning a global footprint—this conversation is your blueprint.
🧠 What You’ll Learn:
⏱️ 01:00 – What is BOT (Build, Operate, Transfer) and why it matters
⏱️ 03:00 – Staff Augmentation vs BOT: key differences
⏱️ 06:30 – Top LATAM cities for talent and operations
⏱️ 09:00 – HR, hardware, and infrastructure for BOT setups
⏱️ 15:50 – Risk, currency, and cost control in LATAM expansion
⏱️ 18:00 – Economic volatility and nearshoring in uncertain times
⏱️ 21:00 – AI’s impact on hiring models and tech ops
⏱️ 26:00 – How founders and CFOs should think about nearshoring now
💡 Key Takeaways:
BOT is ideal for companies needing in-office or hybrid teams at scale
Time zone alignment and cultural compatibility are undervalued advantages
Countries like Mexico, Argentina, and Colombia offer diverse team-building opportunities
Local employment laws and severance rules can drastically shape your LATAM strategy
AI is a tool—not a replacement—for smart global hiring
Conservative planning + flexibility = winning in uncertain economic conditions
🔗 Resources & Connections:
🌐 Learn more about Plugg Technologies: plugg.tech
🌐 Connect with Jared at: bluecoding.com | highersouth.com
👉 Like, Subscribe & Hit the Bell 🔔 for more episodes on global hiring, nearshoring strategies, remote operations, and scaling tech teams across borders!
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Website: nearshorecafepodcast.com
LinkedIn: linkedin.com/company/the-nearshore-cafe
#BuildOperateTransfer #BOTModel #StaffAugmentation #Nearshoring #LatinAmericaTalent #RemoteTeams #GlobalHiring #BlueCoding #PluggTechnologies #JaredAndreassen #TechExpansion #SaaSScaling #StartupOps #NearshoreCafe #HiringStrategy #RemoteWork #GlobalStaffing #TechLeadership
📢 Don’t forget to LIKE, SUBSCRIBE, and TURN ON NOTIFICATIONS for more insights on Latin America’s growing tech scene! 🎧🔥
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:34):
Welcome everyone to another episode of the Nearshore
Cafe podcast.
First, let me thank our sponsor, plug Technologies.
Pluggtech great way to connecttalent from all over Latin
America with growing UScompanies.
There is a concept out therecalled BOT Build Operate
Transfer.
If you've heard of this, you'recurious about it.
(00:56):
This is gonna be the show foryou.
We've got Jared Andreessen, anexecutive with Blue Coding,
jared, so great to see you again.
Yeah, man, thanks for having meback.
I appreciate it.
So let's start there.
Bot People are probably curious.
They don't know what this stuffstands for.
What is it?
What?
Speaker 2 (01:13):
should they know about it?
Yeah, so it's build, operate,transfer, and we use it in the
context of Latin America,obviously, but essentially it's
for companies that are lookingto establish a presence, an
entity, in a Latin Americancountry, and that can be
anywhere from Mexico toArgentina.
Most of the time, it's mid tolarge size cities and companies
are looking to hire asignificant amount of people in
(01:37):
a small area, and it's a lot ofmid to large size SaaS companies
, really company industries, notsuper applicable, but that's
what it is, and we're kind ofseeing significant interest in
the market right now.
Speaker 1 (01:49):
Can you maybe think through like the decision-making
matrix.
You know, there's staff, allcompanies, there's like fully
outsourcing your dev, and thenthere's the BOT and the
trade-offs, and why I might evenwant to do this if I, if I'm a
VP of engineering somewhere or aCFO.
Speaker 2 (02:07):
Yeah.
So there's obviously numerousmodalities.
When it comes to nearshoring, Iwould say the most popular is
probably staff augmentation, andthe majority of that is done
from remote resources.
But a good option for companiesthat are looking to have people
in office or a hybrid modelwould be BOT, and essentially
(02:28):
what they're doing is leasing anoffice in a Latin American
country, they're establishing anentity or we are establishing
the entity for them, we're doingall of the hiring and then
we're sort of operating that fora couple of years before
transferring that back over toour partner.
So I guess the decision-makingprocess is first you have to
(02:49):
understand whether you're remoteor hybrid or onsites.
You have to look at costs and Ithink BOT a lot of the appeal
to it is some of that costsavings and still getting some
really high quality talent thatspeaks English.
And you know, let's say you'rea large SaaS company and you're
located in San Francisco BOTcould be a 70% cost savings
(03:10):
compared to San Francisco.
Now if you go to Minneapolis itmight only be a 30 or 40%
savings, but it depends whereyou're located in the US and
really what your goals are.
But, as you're aware, beinglocated on the same time zone
and if you have other UScustomers or tech support or
call center support, anythinglike that you have to fulfill,
bot is going to be a really goodoption for you.
Speaker 1 (03:33):
Is there generally and I know like there's a lot of
nuances of this, but is theregenerally like a team size that
like it makes sense, Like Iimagine you're not doing BOT for
three people?
Speaker 2 (03:45):
No, I think staff augmentation is a much better
fit for three people.
But what we're kind of seeingin the market is a lot of new
entry, which means smaller teams.
So maybe a company is lookingto outsource a particular IT
team that deals with certainsupport tickets and that
requires 20 people.
So what they'll do is they'llrent a very small office in
(04:08):
Mexico City.
They'll hire the individuals,and really less is more when you
start VOT.
So hiring those 10 or 15 people, learning how to operate them
and then scaling up over time isgenerally the preferred client.
You will run into clients thatneed to hire 100 people in 90
days and onboard them all, whichcan get a little crazy and
(04:30):
hectic, especially when you'recoming into a new market or a
city that you don't have a tonof familiarity with yeah.
Speaker 1 (04:36):
What's usually the first thing that happens in a
BOT?
Do you have an HR person or anoffice space scout?
What is the timeline we use?
Speaker 2 (04:47):
the term country manager.
Okay, so that person is going tobe boots on the ground, have
the key to the office, betalking to people in person
dealing with all of theday-to-day nuances of running
the business.
And it might just not be oneperson, but it's the country
manager, is essentially theproject lead and the person that
(05:08):
would be handling the majorityof the engagement.
Really, the first step isvisiting the city where you want
to do BOT and seeing what partof town you want to put the
office, what the infrastructurelooks like bus lines, public
transportation and understandingthe costs.
And even you know in DOT,pretty much everyone is hired as
(05:30):
employees in their home country.
So you have to look at some ofthe government requirements and
benefits that are offered andseverance, and I think that a
lot of people located in NorthAmerica aren't very familiar
with that in Latin America andthey assume it's like the United
States.
It's actually much stricter insome cases.
(05:50):
Mexico, for example, has muchstricter requirements around
severance and what employeesshould be paid.
So you really have to look atthe right location for your
organization.
Speaker 1 (06:01):
Yeah, speaking of that, are there more popular
cities or countries than othersthat you're seeing right now for
the BOT model?
Speaker 2 (06:08):
Yes and no.
I think it depends on whatyou're looking for and what's
most important whether it'stalent, cost, a culmination of
both and really what rolesyou're looking for.
Because if I'm looking for alot of very high-end senior
developers, I might go to BuenosAires or possibly Mexico City
(06:29):
or Rio.
If I'm looking for a team ofCSMs or account managers, I
would probably look at SantoDomingo or Medellin or Bogota,
and then you factor in the costperspective VA is expensive.
In the cost perspective, VA isexpensive, the talent there is
really good, but you might onlyhave a 20 to 30% cost savings
(06:50):
for North America.
So really you kind of have tosurvey everything you're looking
for, kind of dive into themetrics in each individual city
and kind of make your decisionsfrom there.
Speaker 1 (06:59):
Yeah, In Staffog there's maybe a trend that I see
, and it's not a 2025 trend.
It's maybe the last six yearsof USD because of volatility in
currencies.
Is that the case with BOT or isit, like you said, it's really
a choice?
If you're going to BOT, you'realso automatically choosing
(07:21):
local currency.
Speaker 2 (07:22):
Yeah, so BOT is a little bit different because
everyone would be an employee ofthat country.
You're mainly paying them intheir local currency.
Yeah, now there are ways to paythem in USD, but primarily it's
going to be in their localcurrency and I would say, on
average, people that are hiredmore through a BOT modality are
(07:45):
being hired on more at localrates versus North American
rates.
So you know, in staffaugmentation you might have a
senior developer that's makingvery similar to what he would
make if he lived in the UnitedStates or Canada, but BOT is a
little bit different when itcomes to that aspect.
Speaker 1 (08:01):
Yeah, how about hardware?
How do you think about that?
Because there's differentcountries and customs and
nuances.
Speaker 2 (08:08):
Yeah, Well, that depends on the customer also and
what their requirements are.
Sometimes resources will havetheir own hardware.
Sometimes the companies willwant to provide hardware.
Sometimes organizations willhave a specific vendor that they
send hardware from and thenmany of times we have a local
supplier that we provide themwith hardware with in that local
country.
So, BOT can be much morecomplex than staff augmentation,
(08:31):
but the juice is worth thesqueeze once you get set up.
Speaker 1 (08:35):
Yeah, when you think about the types of customers
that tend to go the BOT routeversus the StaffHog route, what
are the patterns that you'reseeing?
Probably, revenue.
Speaker 2 (08:45):
Bot is more applicable toward large-size
organizations Maybe not largebut mid-size with a few hundred
million dollars in revenue.
Staff augmentation is going tobe a great option for some of
those smaller companies that arescaling, and that can really be
anything from pre-seed topost-seed to $50 million in
(09:06):
revenue.
And we even have organizationsthat have a billion dollars in
revenue doing staff aug.
But I think there's a point ina lot of organizations where
they might have some investors,there's pressures to scale and
there's only so much capital.
So do you put in a massiveoffice in the United States in a
large city, or are you lookingfor a location that might be at
(09:30):
a lower cost?
Speaker 1 (09:30):
Yeah, you know.
We had Ron Nodin on the podcastrecently who's a SCP at Quorum,
M&A advisor, and something hetalked about that surprised me
was percent of M&A transactionsnowadays involve companies with
people in two or more countries.
So I'm trying to think of this,maybe from the CFO standpoint.
There's the cost savingstandpoint, which is kind of
(09:53):
obvious.
Everyone talks about.
But there's the backend side ofwhat is my company valued at
down the road and I think theargument can be made that it's
either a neutral or a positiveimpact to valuation by doing the
BOT model and just havinghaving these people as your
employees and you know, you're,you're in multiple countries
(10:14):
now- yeah, I would agree ahundred percent with that, not
just from a pure costperspective.
Speaker 2 (10:19):
but being located in strategic locations for your
customer base is super appealing, especially if it's not going
to break the bank.
And you know, I would say a lotof customers don't even go the
BOT route necessarily, mainlydue to cost.
They're looking at locationsthat being established in
multiple countries to fulfilltheir customer base.
Speaker 1 (10:40):
Yeah, jared, let's switch gears a little bit.
You took a trip recently, acompany trip.
Tell us all about it.
Speaker 2 (10:47):
Yeah, we went to the Dominican Republic.
We have a lot of team memberslocated there.
We went to a city calledJarabacoa, which is kind of up
in the mountains, I think.
Called Harabucoa, which is kindof up in the mountains, I think
, south of Santiago yeah, that'sright had a really good time,
saw a lot of people, wentwhitewater rafting, almost
(11:09):
drowned.
I'll tell you the story aboutthat.
It's a good one.
So our raft had myself and ourCFO in it and we're both bigger
guys, we weigh over 200 pounds apiece and in the back of our
raft was our marketing managerand our special projects manager
, and they're about a hundredpounds a piece.
So our raft was riding down theriver at an angle the entire
time because you had two bigguys in the front and these were
level four and five rapids andI'd say 35 minutes into the trip
(11:33):
we went under the entire thingcompletely flipped.
Yeah, um, um.
I got banged up pretty good.
My knee, uh, swelled up toabout twice the size that it
normally is, but we all lived.
It was fun.
I was a little sore I'm notgetting any younger and the poor
dominican raft guy that triedto pull me up into the raft I
was probably three times hissize, um, but it was good.
(11:55):
I love the dr, I love thepeople.
It's a lot of fun.
I'm actually hoping to movethere one day.
It's a nice place for me.
Speaker 1 (12:01):
Yeah, that's crazy.
Speaker 2 (12:02):
On the rapids, I actually had no idea DR had four
and five class rapids, you know, I think like Alaska, west
Virginia, not it was a surpriseto me when I showed up to go
rafting also yeah, I did notresearch this Our CEO just said,
hey, we're going rafting, andhe's a very adventurous guy, so
(12:22):
I was not mentally prepared togo on the river.
But nobody's going to saythey're not going to go.
So we all hop in the rafts andwe do it.
Speaker 1 (12:30):
And we live.
Yeah, I love it.
Walk us through the meal plan.
When you were out there, whatwas the food like?
Speaker 2 (12:35):
Walk us through the meal plan.
When you were out there.
What was the food like?
Oh, let's see, we had itcatered and it was a lot of
local Dominican cooking, a lotof plantain, a lot of things I
don't eat in my daily diet now,and even the sausage is
different than a lot of thebreakfast items.
But that's what I love abouttraveling in La Tad.
One of my favorite foods isarepas.
(12:58):
I don't know if you're familiarwith what those are.
Yeah, absolutely.
Yeah, and actually the best onesI ever had were next to the
Venezuelan embassy in MexicoCity.
Okay, yeah, I don't know whythat's like a core memory of
mine or why they were so good,but I can tell you unequivocally
if I go back to Mexico City inthe near future, I'm going right
(13:19):
to that restaurant.
I need to look up the name andI'll share it.
Speaker 1 (13:22):
Yeah, I was going to say most Venezuelans I talk to.
They stand fast that this istheir claim to culinary delight
is the Arepas, I would notdisagree with them.
I don't even know what all thatstuff is, but I love it.
(13:43):
Yeah, yeah, uh, jared, what'sgoing on in the world right now?
Tell us about you know, lasttime we talked this is
pre-election we're, I guess, sixmonths in tariffs economy like
what does that?
Mean for you guys?
What does that mean fornearshoring?
Speaker 2 (13:54):
the short answer is I don't know, and it changes
daily and I check the news dailyand something else has happened
.
We're seeing demand go up.
As a business, we're as busy aswe've ever been.
I'm not feeling a lot of thenegative effects here from a
financial standpoint.
However, man, there's a lot ofcontroversial negative effects
here from a financial standpoint.
However, man, there's a lot ofcontroversial stuff going on in
(14:18):
the world and there's a lot ofpeople with very strong opinions
.
And then you have AI and youhave the stock market.
That seems to be fluctuating ona daily basis and I don't think
anybody knows exactly where theworld is going.
It's like one day we're goinginto a recession, the next day
like the stock market's at anall time high.
(14:38):
It's a lot to deal with, likeas people like going to bed one
night and the next day you wakeup and you're like well, let's
see what today brings.
But I think I'm considered oneof the very older millennials
now and we've kind of seen itall Like we lived through 08.
We lived through 911, covid.
Nothing surprises me anymore,so I'm just kind of riding the
(15:02):
wave, hoping for the best,expect the worst, hope for the
best, I guess.
Speaker 1 (15:05):
Yeah, I was gonna ask .
You know, I guess there's twoschools of thought with it.
Being in a hiring company rightnow is with you know, I like to
describe to people, you knowmaybe, what it's like to be an
entrepreneur, and that doesn'tmatter what the rules of the
game are.
I just need to know what therules are so I can, you know,
operate my business and if therules are in flux, then I'm in
(15:26):
flux.
And I think this maybe goes forCFOs everywhere, you know, as
they're trying to do planningand forecasting, yeah, okay,
capital for hiring.
So I guess one school ofthought is it's unpredictable,
so you might be paralyzed withyour budget.
The other school of thought isI want flexibility and cost
savings because it'sunpredictable.
Speaker 2 (15:48):
Can you talk through that a little bit or?
Speaker 1 (15:50):
does that summarize what the market looks like, or
is there a third path?
I didn't hit on.
Speaker 2 (15:55):
No, I think you nailed it on the head there, and
the only way we found toapproach uncertainty is just be
very conservative in everythingthat you do.
Make sure that you always havetoo much cash.
Make sure that, even if you'renot doing distributions, you
have that cash sitting somewhere, because who knows what's going
(16:16):
to happen six months from now.
And it's interesting because Italk about this with our
internal management team.
All the time we talk aboutscaling and getting larger and
what cash reserves we shouldkeep, and you probably get 10
different opinions for anysituation, different opinions
(16:38):
for any situation, and I know alot of VC firms have slowed down
funding in the last two yearsfrom that crazy 21, 22 timeframe
.
But I even think the majorityof the customer base that we
want to work with and we'd liketo work with are organizations
that have the same approach ofbeing a little bit conservative,
and I just think that's theonly way to approach it.
Now I think there's an argumentthat you'll never become a
(17:00):
billion dollar organization bybeing conservative, and I'd
agree with that.
I guess the cool thing is Idon't really want a billion
dollars.
I have no need for it.
There are some people out thereand organizations that do, but
I don't know.
I think every day is different.
You really just have to do yourresearch, trust your gut and be
(17:21):
conservative with your cashreserves and even your marketing
and advertising and yourbudgeting.
Just be uber conservative ineverything you do and plan, plan
, plan.
Have option A, b, c, probablyall the way through F at this
point.
Speaker 1 (17:36):
Yeah, speaking of the letters, tech startups as they
go through their funding roundshow does that?
How should they think aboutthis?
You know is there, it seemslike fundraising is fewer and
further between, and maybethey're looking to build their
team get to the next milestone.
How would you advise them?
Speaker 2 (17:54):
Well, I think I could talk about this personally,
because I own another smallorganization that's very small
in revenue and it's a startup,and I like to be very cost
conscious, especially when youhave unpredictable revenue or
you have customers churning orwhatever it is, and I have a few
folks that work with me fromLatin America.
They're very low cost, they'revery good, they're educated,
(18:16):
they help the business run on adaily basis and I think if
you're a startup or somebodythat even has a small amount of
funding and you have to make itlast, I think nearshoring in
general, whether you do staffaugmentation or direct hires or
whatever modality you choose,it's really a great way to start
start, not just from a costperspective, but culture and
(18:37):
access.
I can probably be in any majorlatin american city in half a
day, with the exception of, likebuenos aires or somewhere in
chile.
But I think it depends on whatyou want to do.
You know, if you're, if youhave to hire a support team of
20 people, that's certainlydifferent than hiring a
marketing manager or your firstaccounts manager, whatever role
(18:57):
it may be.
But I do think LATAM in generalis a really good place to look,
especially given the market andeverything going around in the
world.
I might be a little bit biased,but those are my thoughts.
Speaker 1 (19:10):
Yeah, yeah.
Last question I'll ask youtoday is if you, you know, if
you're like me, your LinkedInfeed is 90% about AI.
Right, it's?
You know?
It's the birth of the death ofeverybody.
You know what?
What are you seeing?
(19:30):
This is about as vague of aquestion as you can get, but I'm
sure you've got an opinion.
Speaker 2 (19:35):
Yes, I also like to be conservative with my thoughts
when discussing AI, but I thinkof AI as I think of Bitcoin or
electric vehicles or anythingelse that is early in
adaptations on stage.
If you look at electricvehicles, they're on the road.
(19:55):
There's organizations that arevery profitable making them, but
the majority of people stilldrive gas vehicles.
It might be 30 years in thefuture before the majority of
electric vehicles outweigh gasvehicles, and that's how I feel
about AI.
I think it is a great tool tohelp augment your team, whether
(20:17):
that's marketing or developmentor whatever industry you're in,
and I think it will continue toevolve.
I don't see there beingorganizations in my lifetime
that are fully 100% AI.
Yeah, unless you've built an AIapplication, because you're
still going to need people tomake edits or make changes or
(20:37):
write code.
I think it's probably dangerousif AI can do all of that itself
, because then it's its ownentity and we don't need to
exist.
But it's a great tool.
I think it's evolving on adaily basis and you can see by
everybody's feed and all thecompanies that are being built
that the variety of applicationsin the next 10 years is going
to be insane.
(20:58):
Yeah, but for now I like totake a conservative approach
that it's a great tool.
Developers and human capital isnot going to be extinct.
The roles might change a littlebit, though.
I think even in marketingprompts, and having somebody who
really knows how to utilize AIand understand it is going to be
(21:20):
a massive differentiator in thenext few years.
Speaker 1 (21:23):
Yeah, yeah, any tools that you and your team are
using, you know, minus chat, cbtthat you like or would
recommend.
Speaker 2 (21:32):
I think every tool we use now probably has an element
or an API into AI at the momentand that's even talking about
Salesforce and some of thecontact searching tools that we
use at the moment is beingintegrated into every tool as
far as specific ones, I'drecommend.
(21:52):
But I think understanding theway AI calculates information
and where it pulls from is goingto be a massive advantage for
(22:16):
companies, even in the next 12months, from an SEO perspective,
from a customer attainmentperspective.
If I could tell anyone what'sthe most important to learn
right now, I would say get ageneral understanding of AI,
machine learning and understandhow it works.
Those are my thoughts.
Speaker 1 (22:33):
Yeah, no, I agree.
I think that's if you're nottrying it out.
I think you're falling behindand the curve just gets steeper
and steeper every day.
Speaker 2 (22:42):
Yeah, it reminds me of those books from like the
early two thousands of, like theelectricity for dummies.
Like everybody should bereading an AI for dummies book,
um, and at least getting a baseunderstanding as soon as you
catch up and feel like you know,you think you have a handle on
it and it's going to evolve evenmore.
So continuous learning isprobably the most important
skill at the moment, I thinkthat's spot on Jared.
Speaker 1 (23:03):
If anybody wants to find you what's the best way to
do so.
Speaker 2 (23:07):
Yeah, I represent an organization called Blue Coating
and Higher South, sobluecoatingcom and higher
southcom.
You can find me on LinkedIn.
My name is Jared Andreessen,and even if you don't need
anything, I'm happy to chatabout the industry.
Anything you're seeing, I don'tknow, I just like to chat.
Speaker 1 (23:23):
Well, I definitely recommend Jared's a great guy
Obviously, knows a lot aboutbuild, operate, transfer and DR
a place I've never been to yet.
But you should go.
We got to go, absolutely Allright.
Well, thanks everyone forlistening to another episode of
the Nearshore Cafe Podcast.
I'm Brian Sampson and ourpodcast is sponsored by Plug
Technologies P-L-U-G-G dot techGreat way to connect talent from
(23:47):
all over Latin America with UScompanies.
We'll see you next time, Thanks.
Welcome everyone to another episode of the Nearshore
Cafe podcast.
First, let me thank our sponsor, plug Technologies.
Pluggtech great way to connecttalent from all over Latin
America with growing UScompanies.
There is a concept out therecalled BOT Build Operate
Transfer.
If you've heard of this, you'recurious about it.
(00:56):
This is gonna be the show foryou.
We've got Jared Andreessen, anexecutive with Blue Coding,
jared, so great to see you again.
Yeah, man, thanks for having meback.
I appreciate it.
So let's start there.
Bot People are probably curious.
They don't know what this stuffstands for.
What is it?
What?
Speaker 2 (01:13):
should they know about it?
Yeah, so it's build, operate,transfer, and we use it in the
context of Latin America,obviously, but essentially it's
for companies that are lookingto establish a presence, an
entity, in a Latin Americancountry, and that can be
anywhere from Mexico toArgentina.
Most of the time, it's mid tolarge size cities and companies
are looking to hire asignificant amount of people in
(01:37):
a small area, and it's a lot ofmid to large size SaaS companies
, really company industries, notsuper applicable, but that's
what it is, and we're kind ofseeing significant interest in
the market right now.
Speaker 1 (01:49):
Can you maybe think through like the decision-making
matrix.
You know, there's staff, allcompanies, there's like fully
outsourcing your dev, and thenthere's the BOT and the
trade-offs, and why I might evenwant to do this if I, if I'm a
VP of engineering somewhere or aCFO.
Speaker 2 (02:07):
Yeah.
So there's obviously numerousmodalities.
When it comes to nearshoring, Iwould say the most popular is
probably staff augmentation, andthe majority of that is done
from remote resources.
But a good option for companiesthat are looking to have people
in office or a hybrid modelwould be BOT, and essentially
(02:28):
what they're doing is leasing anoffice in a Latin American
country, they're establishing anentity or we are establishing
the entity for them, we're doingall of the hiring and then
we're sort of operating that fora couple of years before
transferring that back over toour partner.
So I guess the decision-makingprocess is first you have to
(02:49):
understand whether you're remoteor hybrid or onsites.
You have to look at costs and Ithink BOT a lot of the appeal
to it is some of that costsavings and still getting some
really high quality talent thatspeaks English.
And you know, let's say you'rea large SaaS company and you're
located in San Francisco BOTcould be a 70% cost savings
(03:10):
compared to San Francisco.
Now if you go to Minneapolis itmight only be a 30 or 40%
savings, but it depends whereyou're located in the US and
really what your goals are.
But, as you're aware, beinglocated on the same time zone
and if you have other UScustomers or tech support or
call center support, anythinglike that you have to fulfill,
bot is going to be a really goodoption for you.
Speaker 1 (03:33):
Is there generally and I know like there's a lot of
nuances of this, but is theregenerally like a team size that
like it makes sense, Like Iimagine you're not doing BOT for
three people?
Speaker 2 (03:45):
No, I think staff augmentation is a much better
fit for three people.
But what we're kind of seeingin the market is a lot of new
entry, which means smaller teams.
So maybe a company is lookingto outsource a particular IT
team that deals with certainsupport tickets and that
requires 20 people.
So what they'll do is they'llrent a very small office in
(04:08):
Mexico City.
They'll hire the individuals,and really less is more when you
start VOT.
So hiring those 10 or 15 people, learning how to operate them
and then scaling up over time isgenerally the preferred client.
You will run into clients thatneed to hire 100 people in 90
days and onboard them all, whichcan get a little crazy and
(04:30):
hectic, especially when you'recoming into a new market or a
city that you don't have a tonof familiarity with yeah.
Speaker 1 (04:36):
What's usually the first thing that happens in a
BOT?
Do you have an HR person or anoffice space scout?
What is the timeline we use?
Speaker 2 (04:47):
the term country manager.
Okay, so that person is going tobe boots on the ground, have
the key to the office, betalking to people in person
dealing with all of theday-to-day nuances of running
the business.
And it might just not be oneperson, but it's the country
manager, is essentially theproject lead and the person that
(05:08):
would be handling the majorityof the engagement.
Really, the first step isvisiting the city where you want
to do BOT and seeing what partof town you want to put the
office, what the infrastructurelooks like bus lines, public
transportation and understandingthe costs.
And even you know in DOT,pretty much everyone is hired as
(05:30):
employees in their home country.
So you have to look at some ofthe government requirements and
benefits that are offered andseverance, and I think that a
lot of people located in NorthAmerica aren't very familiar
with that in Latin America andthey assume it's like the United
States.
It's actually much stricter insome cases.
(05:50):
Mexico, for example, has muchstricter requirements around
severance and what employeesshould be paid.
So you really have to look atthe right location for your
organization.
Speaker 1 (06:01):
Yeah, speaking of that, are there more popular
cities or countries than othersthat you're seeing right now for
the BOT model?
Speaker 2 (06:08):
Yes and no.
I think it depends on whatyou're looking for and what's
most important whether it'stalent, cost, a culmination of
both and really what rolesyou're looking for.
Because if I'm looking for alot of very high-end senior
developers, I might go to BuenosAires or possibly Mexico City
(06:29):
or Rio.
If I'm looking for a team ofCSMs or account managers, I
would probably look at SantoDomingo or Medellin or Bogota,
and then you factor in the costperspective VA is expensive.
In the cost perspective, VA isexpensive, the talent there is
really good, but you might onlyhave a 20 to 30% cost savings
(06:50):
for North America.
So really you kind of have tosurvey everything you're looking
for, kind of dive into themetrics in each individual city
and kind of make your decisionsfrom there.
Speaker 1 (06:59):
Yeah, In Staffog there's maybe a trend that I see
, and it's not a 2025 trend.
It's maybe the last six yearsof USD because of volatility in
currencies.
Is that the case with BOT or isit, like you said, it's really
a choice?
If you're going to BOT, you'realso automatically choosing
(07:21):
local currency.
Speaker 2 (07:22):
Yeah, so BOT is a little bit different because
everyone would be an employee ofthat country.
You're mainly paying them intheir local currency.
Yeah, now there are ways to paythem in USD, but primarily it's
going to be in their localcurrency and I would say, on
average, people that are hiredmore through a BOT modality are
(07:45):
being hired on more at localrates versus North American
rates.
So you know, in staffaugmentation you might have a
senior developer that's makingvery similar to what he would
make if he lived in the UnitedStates or Canada, but BOT is a
little bit different when itcomes to that aspect.
Speaker 1 (08:01):
Yeah, how about hardware?
How do you think about that?
Because there's differentcountries and customs and
nuances.
Speaker 2 (08:08):
Yeah, Well, that depends on the customer also and
what their requirements are.
Sometimes resources will havetheir own hardware.
Sometimes the companies willwant to provide hardware.
Sometimes organizations willhave a specific vendor that they
send hardware from and thenmany of times we have a local
supplier that we provide themwith hardware with in that local
country.
So, BOT can be much morecomplex than staff augmentation,
(08:31):
but the juice is worth thesqueeze once you get set up.
Speaker 1 (08:35):
Yeah, when you think about the types of customers
that tend to go the BOT routeversus the StaffHog route, what
are the patterns that you'reseeing?
Probably, revenue.
Speaker 2 (08:45):
Bot is more applicable toward large-size
organizations Maybe not largebut mid-size with a few hundred
million dollars in revenue.
Staff augmentation is going tobe a great option for some of
those smaller companies that arescaling, and that can really be
anything from pre-seed topost-seed to $50 million in
(09:06):
revenue.
And we even have organizationsthat have a billion dollars in
revenue doing staff aug.
But I think there's a point ina lot of organizations where
they might have some investors,there's pressures to scale and
there's only so much capital.
So do you put in a massiveoffice in the United States in a
large city, or are you lookingfor a location that might be at
(09:30):
a lower cost?
Speaker 1 (09:30):
Yeah, you know.
We had Ron Nodin on the podcastrecently who's a SCP at Quorum,
M&A advisor, and something hetalked about that surprised me
was percent of M&A transactionsnowadays involve companies with
people in two or more countries.
So I'm trying to think of this,maybe from the CFO standpoint.
There's the cost savingstandpoint, which is kind of
(09:53):
obvious.
Everyone talks about.
But there's the backend side ofwhat is my company valued at
down the road and I think theargument can be made that it's
either a neutral or a positiveimpact to valuation by doing the
BOT model and just havinghaving these people as your
employees and you know, you're,you're in multiple countries
(10:14):
now- yeah, I would agree ahundred percent with that, not
just from a pure costperspective.
Speaker 2 (10:19):
but being located in strategic locations for your
customer base is super appealing, especially if it's not going
to break the bank.
And you know, I would say a lotof customers don't even go the
BOT route necessarily, mainlydue to cost.
They're looking at locationsthat being established in
multiple countries to fulfilltheir customer base.
Speaker 1 (10:40):
Yeah, jared, let's switch gears a little bit.
You took a trip recently, acompany trip.
Tell us all about it.
Speaker 2 (10:47):
Yeah, we went to the Dominican Republic.
We have a lot of team memberslocated there.
We went to a city calledJarabacoa, which is kind of up
in the mountains, I think.
Called Harabucoa, which is kindof up in the mountains, I think
, south of Santiago yeah, that'sright had a really good time,
saw a lot of people, wentwhitewater rafting, almost
(11:09):
drowned.
I'll tell you the story aboutthat.
It's a good one.
So our raft had myself and ourCFO in it and we're both bigger
guys, we weigh over 200 pounds apiece and in the back of our
raft was our marketing managerand our special projects manager
, and they're about a hundredpounds a piece.
So our raft was riding down theriver at an angle the entire
time because you had two bigguys in the front and these were
level four and five rapids andI'd say 35 minutes into the trip
(11:33):
we went under the entire thingcompletely flipped.
Yeah, um, um.
I got banged up pretty good.
My knee, uh, swelled up toabout twice the size that it
normally is, but we all lived.
It was fun.
I was a little sore I'm notgetting any younger and the poor
dominican raft guy that triedto pull me up into the raft I
was probably three times hissize, um, but it was good.
(11:55):
I love the dr, I love thepeople.
It's a lot of fun.
I'm actually hoping to movethere one day.
It's a nice place for me.
Speaker 1 (12:01):
Yeah, that's crazy.
Speaker 2 (12:02):
On the rapids, I actually had no idea DR had four
and five class rapids, you know, I think like Alaska, west
Virginia, not it was a surpriseto me when I showed up to go
rafting also yeah, I did notresearch this Our CEO just said,
hey, we're going rafting, andhe's a very adventurous guy, so
(12:22):
I was not mentally prepared togo on the river.
But nobody's going to saythey're not going to go.
So we all hop in the rafts andwe do it.
Speaker 1 (12:30):
And we live.
Yeah, I love it.
Walk us through the meal plan.
When you were out there, whatwas the food like?
Speaker 2 (12:35):
Walk us through the meal plan.
When you were out there.
What was the food like?
Oh, let's see, we had itcatered and it was a lot of
local Dominican cooking, a lotof plantain, a lot of things I
don't eat in my daily diet now,and even the sausage is
different than a lot of thebreakfast items.
But that's what I love abouttraveling in La Tad.
One of my favorite foods isarepas.
(12:58):
I don't know if you're familiarwith what those are.
Yeah, absolutely.
Yeah, and actually the best onesI ever had were next to the
Venezuelan embassy in MexicoCity.
Okay, yeah, I don't know whythat's like a core memory of
mine or why they were so good,but I can tell you unequivocally
if I go back to Mexico City inthe near future, I'm going right
(13:19):
to that restaurant.
I need to look up the name andI'll share it.
Speaker 1 (13:22):
Yeah, I was going to say most Venezuelans I talk to.
They stand fast that this istheir claim to culinary delight
is the Arepas, I would notdisagree with them.
I don't even know what all thatstuff is, but I love it.
(13:43):
Yeah, yeah, uh, jared, what'sgoing on in the world right now?
Tell us about you know, lasttime we talked this is
pre-election we're, I guess, sixmonths in tariffs economy like
what does that?
Mean for you guys?
What does that mean fornearshoring?
Speaker 2 (13:54):
the short answer is I don't know, and it changes
daily and I check the news dailyand something else has happened
.
We're seeing demand go up.
As a business, we're as busy aswe've ever been.
I'm not feeling a lot of thenegative effects here from a
financial standpoint.
However, man, there's a lot ofcontroversial negative effects
here from a financial standpoint.
However, man, there's a lot ofcontroversial stuff going on in
(14:18):
the world and there's a lot ofpeople with very strong opinions
.
And then you have AI and youhave the stock market.
That seems to be fluctuating ona daily basis and I don't think
anybody knows exactly where theworld is going.
It's like one day we're goinginto a recession, the next day
like the stock market's at anall time high.
(14:38):
It's a lot to deal with, likeas people like going to bed one
night and the next day you wakeup and you're like well, let's
see what today brings.
But I think I'm considered oneof the very older millennials
now and we've kind of seen itall Like we lived through 08.
We lived through 911, covid.
Nothing surprises me anymore,so I'm just kind of riding the
(15:02):
wave, hoping for the best,expect the worst, hope for the
best, I guess.
Speaker 1 (15:05):
Yeah, I was gonna ask .
You know, I guess there's twoschools of thought with it.
Being in a hiring company rightnow is with you know, I like to
describe to people, you knowmaybe, what it's like to be an
entrepreneur, and that doesn'tmatter what the rules of the
game are.
I just need to know what therules are so I can, you know,
operate my business and if therules are in flux, then I'm in
(15:26):
flux.
And I think this maybe goes forCFOs everywhere, you know, as
they're trying to do planningand forecasting, yeah, okay,
capital for hiring.
So I guess one school ofthought is it's unpredictable,
so you might be paralyzed withyour budget.
The other school of thought isI want flexibility and cost
savings because it'sunpredictable.
Speaker 2 (15:48):
Can you talk through that a little bit or?
Speaker 1 (15:50):
does that summarize what the market looks like, or
is there a third path?
I didn't hit on.
Speaker 2 (15:55):
No, I think you nailed it on the head there, and
the only way we found toapproach uncertainty is just be
very conservative in everythingthat you do.
Make sure that you always havetoo much cash.
Make sure that, even if you'renot doing distributions, you
have that cash sitting somewhere, because who knows what's going
(16:16):
to happen six months from now.
And it's interesting because Italk about this with our
internal management team.
All the time we talk aboutscaling and getting larger and
what cash reserves we shouldkeep, and you probably get 10
different opinions for anysituation, different opinions
(16:38):
for any situation, and I know alot of VC firms have slowed down
funding in the last two yearsfrom that crazy 21, 22 timeframe
.
But I even think the majorityof the customer base that we
want to work with and we'd liketo work with are organizations
that have the same approach ofbeing a little bit conservative,
and I just think that's theonly way to approach it.
Now I think there's an argumentthat you'll never become a
(17:00):
billion dollar organization bybeing conservative, and I'd
agree with that.
I guess the cool thing is Idon't really want a billion
dollars.
I have no need for it.
There are some people out thereand organizations that do, but
I don't know.
I think every day is different.
You really just have to do yourresearch, trust your gut and be
(17:21):
conservative with your cashreserves and even your marketing
and advertising and yourbudgeting.
Just be uber conservative ineverything you do and plan, plan
, plan.
Have option A, b, c, probablyall the way through F at this
point.
Speaker 1 (17:36):
Yeah, speaking of the letters, tech startups as they
go through their funding roundshow does that?
How should they think aboutthis?
You know is there, it seemslike fundraising is fewer and
further between, and maybethey're looking to build their
team get to the next milestone.
How would you advise them?
Speaker 2 (17:54):
Well, I think I could talk about this personally,
because I own another smallorganization that's very small
in revenue and it's a startup,and I like to be very cost
conscious, especially when youhave unpredictable revenue or
you have customers churning orwhatever it is, and I have a few
folks that work with me fromLatin America.
They're very low cost, they'revery good, they're educated,
(18:16):
they help the business run on adaily basis and I think if
you're a startup or somebodythat even has a small amount of
funding and you have to make itlast, I think nearshoring in
general, whether you do staffaugmentation or direct hires or
whatever modality you choose,it's really a great way to start
start, not just from a costperspective, but culture and
(18:37):
access.
I can probably be in any majorlatin american city in half a
day, with the exception of, likebuenos aires or somewhere in
chile.
But I think it depends on whatyou want to do.
You know, if you're, if youhave to hire a support team of
20 people, that's certainlydifferent than hiring a
marketing manager or your firstaccounts manager, whatever role
(18:57):
it may be.
But I do think LATAM in generalis a really good place to look,
especially given the market andeverything going around in the
world.
I might be a little bit biased,but those are my thoughts.
Speaker 1 (19:10):
Yeah, yeah.
Last question I'll ask youtoday is if you, you know, if
you're like me, your LinkedInfeed is 90% about AI.
Right, it's?
You know?
It's the birth of the death ofeverybody.
You know what?
What are you seeing?
(19:30):
This is about as vague of aquestion as you can get, but I'm
sure you've got an opinion.
Speaker 2 (19:35):
Yes, I also like to be conservative with my thoughts
when discussing AI, but I thinkof AI as I think of Bitcoin or
electric vehicles or anythingelse that is early in
adaptations on stage.
If you look at electricvehicles, they're on the road.
(19:55):
There's organizations that arevery profitable making them, but
the majority of people stilldrive gas vehicles.
It might be 30 years in thefuture before the majority of
electric vehicles outweigh gasvehicles, and that's how I feel
about AI.
I think it is a great tool tohelp augment your team, whether
(20:17):
that's marketing or developmentor whatever industry you're in,
and I think it will continue toevolve.
I don't see there beingorganizations in my lifetime
that are fully 100% AI.
Yeah, unless you've built an AIapplication, because you're
still going to need people tomake edits or make changes or
(20:37):
write code.
I think it's probably dangerousif AI can do all of that itself
, because then it's its ownentity and we don't need to
exist.
But it's a great tool.
I think it's evolving on adaily basis and you can see by
everybody's feed and all thecompanies that are being built
that the variety of applicationsin the next 10 years is going
to be insane.
(20:58):
Yeah, but for now I like totake a conservative approach
that it's a great tool.
Developers and human capital isnot going to be extinct.
The roles might change a littlebit, though.
I think even in marketingprompts, and having somebody who
really knows how to utilize AIand understand it is going to be
(21:20):
a massive differentiator in thenext few years.
Speaker 1 (21:23):
Yeah, yeah, any tools that you and your team are
using, you know, minus chat, cbtthat you like or would
recommend.
Speaker 2 (21:32):
I think every tool we use now probably has an element
or an API into AI at the momentand that's even talking about
Salesforce and some of thecontact searching tools that we
use at the moment is beingintegrated into every tool as
far as specific ones, I'drecommend.
(21:52):
But I think understanding theway AI calculates information
and where it pulls from is goingto be a massive advantage for
(22:16):
companies, even in the next 12months, from an SEO perspective,
from a customer attainmentperspective.
If I could tell anyone what'sthe most important to learn
right now, I would say get ageneral understanding of AI,
machine learning and understandhow it works.
Those are my thoughts.
Speaker 1 (22:33):
Yeah, no, I agree.
I think that's if you're nottrying it out.
I think you're falling behindand the curve just gets steeper
and steeper every day.
Speaker 2 (22:42):
Yeah, it reminds me of those books from like the
early two thousands of, like theelectricity for dummies.
Like everybody should bereading an AI for dummies book,
um, and at least getting a baseunderstanding as soon as you
catch up and feel like you know,you think you have a handle on
it and it's going to evolve evenmore.
So continuous learning isprobably the most important
skill at the moment, I thinkthat's spot on Jared.
Speaker 1 (23:03):
If anybody wants to find you what's the best way to
do so.
Speaker 2 (23:07):
Yeah, I represent an organization called Blue Coating
and Higher South, sobluecoatingcom and higher
southcom.
You can find me on LinkedIn.
My name is Jared Andreessen,and even if you don't need
anything, I'm happy to chatabout the industry.
Anything you're seeing, I don'tknow, I just like to chat.
Speaker 1 (23:23):
Well, I definitely recommend Jared's a great guy
Obviously, knows a lot aboutbuild, operate, transfer and DR
a place I've never been to yet.
But you should go.
We got to go, absolutely Allright.
Well, thanks everyone forlistening to another episode of
the Nearshore Cafe Podcast.
I'm Brian Sampson and ourpodcast is sponsored by Plug
Technologies P-L-U-G-G dot techGreat way to connect talent from
(23:47):
all over Latin America with UScompanies.
We'll see you next time, Thanks.
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