Roberto Hidalgo spent five years trying to build a software company in his home country of Mexico before realizing he needed more experience. Or as he put it, “I sucked at business.” So he decided to see firsthand how successful companies bootstrap and took a job as a developer at a health-tech company in New York. Even though he eventually planned on returning to Mexico, “I could have seen myself staying [in New York] for a decade or more,” he said. That was until Covid-19.
In March, as the city went into lockdown, Hidalgo was laid off. He took a month off and began visualizing what the next year would look like. The summer was fine, but he didn’t think he could last a full winter indoors. So, in December, he moved back to Mexico, ultimately finding a new coding job at a New York–based fintech startup that allowed him to work remotely from Mexico City.
The pandemic has thrown the future of work into flux. This is especially true in tech, an industry notoriously concentrated in several expensive U.S. cities. But as Covid-19 takes a toll on these overpriced outposts, many workers are choosing to relocate domestically to more affordable ones, such as Phoenix, Boise, or Miami. For those who moved to Silicon Valley from India or Nigeria or anywhere else in the world, though, Covid-19 may mean they finally no longer have to choose between their home and their career.
Tomás Gutiérrez Meoz, a Colombian-American entrepreneur, was born and raised in Bogotá but moved to Minnesota when he was 15. He ended up working for a Silicon Valley staffing company and living in Sebastopol, a small city in Sonoma County where rents were as high as those in San Francisco. In 2019, Gutiérrez Meoz decided to move back to Colombia, where he figured he would have a competitive advantage. He spoke the language, knew the politics, and had a built-in community. As he described it, “I could do pretty good arbitrage.”
He found a three-bedroom house overlooking a canyon in Pereira, a small city in Colombia’s coffee country, for $700 a month. The price might have been high by Colombian standards, but it was a quarter of what he had been paying in Sebastopol.
Predicting a world in which more and more people would make a similar calculation, Gutiérrez Meoz began developing a video-conferencing platform for geographically distributed teams. His hunch was confirmed as the coronavirus pandemic spread and offices around the world switched to video apps. “We’ve realized that remote is not only possible, but it’s actually a way forward,” Gutiérrez Meoz told Rest of World. “At that point, it doesn’t matter whether you’re in the U.S. or even international.”
At the same time, the global shift to remote work hasn’t been entirely positive for Tribe, Gutiérrez Meoz’s company. As more companies hire remotely, engineers and other highly skilled tech workers are finding themselves in a position to be picky about the jobs they accept. “Between when Covid hit and now, it’s a very different labor market,” said Gutiérrez Meoz. “Before, you could throw a net and create some positions, and you’d get really good talent. Now it’s harder.”
Preethi Kasireddy, an Indian-American entrepreneur and former partner at Andreessen Horowitz, sees a future where tech work is completely dispersed. “We’re going to move to much more decentralized and distributed tech hubs all around the world,” she said. “All you need is, basically, a laptop, and you can be anywhere.”
Even before the pandemic, U.S. tech companies tired of competing for engineering talent in San Francisco and New York were beginning to build up teams in other global tech hubs, such as Medellín and Guadalajara. These workers weren’t simply outsourced programmers assigned to peripheral tasks but developers working on core projects. Kasireddy believes that this approach is going to expand exponentially. Major tech companies such as Spotify have signaled their willingness to let U.S. employees work from abroad, while many American companies, conversely, have restricted remote work to within the United States.
Of course, there are myriad obstacles to this kind of globalized future. One is the allure of offices, which many tech companies build their recruiting around, offering catered lunches, hoverboards, and laundry services. (IRL offices also have the perk of letting employers keep a close eye on workers.) Another is what Gutiérrez Meoz refers to as “life ops” — setting up bank accounts, sorting out work visas, navigating payroll logistics, etc. In the United States, HR companies like Gusto and Zenefits can take care of the red tape, but the bureaucratic hurdles magnify once international borders are added to the equation. A handful of startups have emerged to address these complications, such as the Y Combinator–backed Deel, although they can never provide a one-size-fits-all solution. Experts who do accounting for tech companies say that their work has grown dramatically more complicated as employees move across state lines and startups increasingly look abroad for contractors and full-time employees.
This vision of the future isn’t a bunch of Silicon Valley transplants living on a resort in Barbados or Puerto Rico. Kasireddy believes the brave new world of tech will be led by entrepreneurs outside of the United States because the traditional barriers limiting venture investment and access to engineers are breaking down. “You can be living in a village in India and get capital or talent from Silicon Valley, and there’s nothing stopping you,” she said. The current reality, however, is that access to funding is still largely determined by connections to elite international networks — the kind you make by attending Harvard Business School or working for a blue-chip U.S. tech company. As successive generations of founders emerge outside of the United States, though, those networks may shift and expand, and in the not-so-distant future, becoming a successful entrepreneur may no longer require a direct line to the United States.
To this end, while most VC money still flows from the U.S. — namely, from the two branches of Sequoia that focus on China and India — during the pandemic, some of the largest venture deals happened elsewhere. In Asia, Reliance Jio raised more than $15.2 billion in funding, and Grab, Gojek, Yuanfudao, and Zuoyebang all raised more than $750 million apiece. While the United States saw a decline in venture funding during the pandemic, other global hubs, such as Brazil, India, and Indonesia, experienced the opposite.
Even for international tech cities that previously had close links to Silicon Valley, the pandemic is altering relationships. Tal Barnoach, an Israeli investor, didn’t have a week, pre-pandemic, in which a founder of one of his 30 portfolio companies wasn’t flying to the States. He personally would travel to the U.S. a dozen times a year. Now, everyone is grounded in Israel, and he hasn’t been to the U.S. since the beginning of last year.
Although Barnoach thinks that the relationship between the two countries will largely return to normal, he has noticed a shift in the Israeli tech scene. The growth and scaling of local tech companies is increasing, which is, in turn, creating more possibilities for Israeli firms to do business with one another. “There are a lot of entrepreneurs who will move to the U.S. to launch a startup there,” he told Rest of World. “We’re going to see fewer and fewer people like this.”
But the majority of the international tech workers living in the United States aren’t investors or serial entrepreneurs. They’re software developers, customer-success representatives, and marketing associates trying to get a foothold in the industry in the most proven way: getting a visa and moving to New York or the Bay Area. Now, they’re stuck figuring out what a post-Covid-19 world will look like.
In 2019, Raisha Shrestha had just graduated from college and received a temporary work visa in the U.S. She got a sales job at a fintech company in New York but had been working there for less than a year when the office went fully remote. With her commissions going down, she had to move twice to find cheaper rent. Eventually, she realized the hassle wasn’t worth it and decided to return home to Nepal.
Shrestha has been living with her parents since January. She’s still working East Coast hours, which means going to bed at 5 a.m. and waking up at noon. She’s also paying $500 a month in roaming charges for her phone, but it beats the $3,000 she was paying in rent.
“I have unfinished business in New York,” Shrestha said. She plans on returning to go to grad school for accounting. She wants a real office job, not just a remote one. For the time being, though, she’s adjusting to jet lag and not being able to go to her corner bodega. “Right now, decision-making is just so overwhelming.”