What were we thinking?

San Miguel de Allende

For 10 years, I’d been trying to make a home in Mexico. I lived in San Miguel de Allende in Guanajuato for my first attempt. It was there that I fell in love with the country for the first time. My career took me to Denver for a few years after that. When the opportunity to try Mexico came again, I moved to Mexico City, then New York City.

Condesa-Williamsburg

While in NYC, I lived in Long Island City and Brooklyn and in Colonia Roma Norte, Mexico City, flying back and forth regularly. Those who have lived in Brooklyn and Roma-Condesa will know what it means to call Mexico City the 7th borough of New York City (the 6th being Philly). Out in public or at parties, one tends to see some of the same faces in both places, often at random. NYC and DF are very closely connected economically, socially, and culturally. Ambas ciudades son muy intensas. Me gusta eso.

COVID

At the height of the pandemic, I found myself living in Brooklyn, laid off, cooped up in a 1BR apartment, paying $3,200usd per month, and unable to go anywhere due to the quarantine. Why am I still here? I asked myself.

“Cuentan que en Oaxaca se toma el mezcal con café” –Lila Downs

During my first visit to Mexico in 2006, I stayed at a hotel in Patzcuaro Michoacan, where I found a stack of CDs by the Oaxaqueña-American musician, Lila Downs. On one, I heard La Cumbia de Mole, a song that mentioned Oaxaca. I had never heard of Oaxaca, but there was something about that song that told me it was special. In 2017 I had the opportunity to spend a few days in Oaxaca de Juarez, the capital, and what I saw exceeded my expectations. The city is indeed quite beautiful, magical even.

So, in August of 2020, off to Oaxaca I went. Just a week after I arrived, I met the woman who would, about a year later would become my esposa and eventually one of my business partners. Shortly after that, I became a permanent resident of Mexico, on track to eventually become a citizen.

Digital Nomadism

Since 2000, I’ve been working remotely, sometimes from home, often from airports, AirBnB’s, and hotels. But I was all in with Mexico now. I leased an apartment and shipped everything I owned down from Brooklyn. From Oaxaca, I continued to work as a cybersecurity consultant and CISO for companies that didn’t care where I was physically located. All I needed was reliable Internet access to be able to concentrate on my work. Easy enough in major Mexican cities. Oaxaca de Juarez has remarkably good Internet service, which continues to surprise me since it’s the least techy city I’ve known. The appeal of the place is in its low-tech, ancient, and artisanal beauty. I swore that I’d never do business in Mexico. My Spanish was terrible despite years of studying and hours of daily practice. (It still is.) Besides, my professional network in the US is strong, and I’ve always managed to make a living working remotely for American companies.

Bootstrapping

But in the Summer of 2022, it became clear that I would never be able to retire just on my 401k, even in Mexico. I would have to start a company or eventually starve. So a couple of partners and I (including Laura Maria, my Oaxaqueña wife) started to talk about the possibility of a cybersecurity services company. Entrepreneurship was beginning to look inevitable.

We realized that we are in a unique position:

• Business development. We have a strong network of potential clients and partners in the US, UK, and Europe.
• Location. We have a physical presence in both Mexico and the US.
• Experience. We have led services before, albeit for the benefit of other companies. We’ve probably hired and managed hundreds of people over the years.
• Perspective. Having spent decades in the business, know all sides of cybersecurity, including technology, sales, marketing, and security operations. Cyber is in our bones.
• Efficiency. We didn’t need much capital. Bootstrapping is usually the simplest and fastest way to get a company off the ground, and we were in a perfect place to keep our costs low.

So, we decided to start Nearshore Cyber. Although we eventually want to offer a broad range of professional and managed cybersecurity services, we decided to start with something relatively simple.

Staffing and Recruiting

The staffing game isn’t fancy or glamorous, but it’s lucrative and doesn’t require much capital, at least initially. Our business model is quite simple. We can offer high-quality cyber expertise at 20-70% less than in the US, which is not as cheap as in India, but without the time zone difference, long flights, and language issues.

So, this became our business strategy:

• Source labor from Mexico and only Mexico. There’s formidable cyber talent all over LATAM. And as tempting as it might be to recruit from tech centers like Colombia, Costa Rica, and Argentina, we wanted to focus our research and relationship-building on one country. The rest of LATAM will have to wait.
• Sell services exclusively to US clients. We understand the market intimately, and the margins are strong.
•  Don’t sell anything into the Mexican market. Buying labor here is complicated enough. Selling to Mexican companies would mean lower margins plus lots and lots of paperwork, not to mention certain risks. Instead, we refer domestic business to our friends and allies.
• Because subcontracting core business services is illegal in Mexico, we must hire any employee that delivers services on our behalf. Therefore, we only sell long-term contracts. In other words, at this stage, we’re in the staff augmentation business.
• Concentrate on building relationships with high-quality Mexican cyber professionals. We spend an awful lot of time reviewing and researching the labor market. We interview candidates thoroughly before presenting them to clients.
• Keep the hiring manager’s burden as light as possible. Because we know cyber from the inside, we know what hiring managers need. Turnkey, low-risk resourcing is our goal.
• Hire for remote WFH positions exclusively. Why? That’s how we work,k and it’s better for everyone, in our experience. Companies that insist on employees working out of an office are simply not our clients. Work-from-office is dinosaur stuff. WFH is our present and future.

So far so good

As of late November 2022, we’re four months in, and our original thesis is holding up well. We have learned a lot and have made plenty of minor course corrections. Despite economic turmoil around the world, our prospects are bright and improving every day. Even my Spanish is getting better, cada día, poco a poco.