Friday, August 01, 2008

Living the Dream: The Expatriate Entrepreneur

For many, the grass is always greener on the other side. Me, I tend to be content where I am as an entrepreneur who creates his own job. However, the wife and I have fostered a dream for years of living a gracious expatriate life in the elegant colonial city of Oaxaca, Mexico.

Situated in a highlands of southern Mexico at the confluence of three mountain valleys, Oaxaca has a history of several thousand years of continuous culture amidst it's charming colonial splendor. Serena and I spent half of '97 living and working here, and vowed to return.

Things were different in '97. We were both engrossed in creative work that did not require daily communication with the outside world. As the internet was barely out of diapers back then, Oaxaca truly felt remote from the bustling atmosphere of our Oakland, California home. I had left my business affairs in the capable hands of a trusted associate. This worked well in terms of sustaining the business, but the carrot I offered was most of the income while I enjoyed my half year off to work on a graphic novel. It worked short term, but the lack of income brought me home after six months.

As of this writing, it's been just a few days shy of a year since we moved permanently to Oaxaca with our young family to live our dream of an expatriate life here. I am happy to report that it is eminently doable. Both of us are working from our new home via internet and phone with few problems, enjoying the relative strength of our earning power in a charmed area with a lower cost of living.

First of all, a note to parents on the move. Serena did a pile of research on schools in Oaxaca, and we were able to find a fine private school for our two kids for under $500.00 U.S. per month for both. With the sorry state of education in the U.S. at present, we are very pleased that our kids are learning a second language and critical thinking skills here. There are schools available for a range of prices with a variety of approaches. Our school is more writing and creative based, yet still offers a fine academic experience.

Now, to the meat of the matter, how the heck do I run my business from Oaxaca?! There are a few key details to the nuts and bolts of it all. First of all, I picked up a deal of a laptop from Dell. I recommend buying a “refurbished” computer from Dell, as you get a (basically) new computer that someone returned for one reason or another. Dell gives it a thorough check and resells it at a deep discount. It is a great value and I needed to replace my five year old desktop machine in any case.

In Oaxaca, we had two choices for internet, Infinitum from TelMex, the phone company, or cable from Cablemas. We had a rental house for the first several months (before buying a house) with Infinitum internet. It was decent high speed internet, but I will say that the speed of the service varied. Who knows why? Also, the modem broke and TelMex was more than happy to sell us a new one! Ha, service with a smile for a price.

When we bought a house recently, we went and talked to TelMex. It was about $200 U.S. just to open an account, and then it would take 4 – 6 weeks for them to show up and get us rolling. Thanks, and goodbye TelMex! We went to Cablemas, they opened an account for 15 bucks and we had internet, fastest I've ever had, the next day!

Next up, phones. We have a Skype account and a Vonage account. Both offer impressive capability to call the U.S. or anywhere else for a pittance. With Skype, you need to buy a microphone for your computer. Big deal, I picked one up for 5 bucks. You download the software and give them a card number. Boom, we were calling the U.S. for 4 cents a minute the next day. The only problem is you don't have a phone number where people can call you, you have a Skype name. Anyone who has a Skype account can call you, provided you are at your computer with the sound on!

With Vonage, I signed up for an account offering 500 minutes per month for about $19.00. It cost maybe $70 to open the account. You can pick the area code for your phone number, I picked the S.F. Bay Area since most of my clients are there.

Vonage offers various pieces of equipment to use for calling, you can get a flash device phone that plugs into your USB port, or you can order a router that hooks up to a phone. The latter may be better as it can be set to ring, so you don't have to be at your computer with headphones on to get a call.

Thus it is pretty easy these days to hook up basic office services abroad. What else might you need? Oh year, clients! It is my good fortune to have a roster of truly great clients who I have done business with for years. By respecting them and delivering value, we have built relationships of long standing that are beneficial to all parties. They hold up their end by paying the invoices!

As my business is custom screen printing of T Shirts and sportswear, it's necessary for me to have great suppliers and associates, too. Again, it's my great fortune to have two printers working with me. Both are consummate professionals who I can count on. We have many years of working together behind us. The key thing with my clients and suppliers is that we have built trust with each other over time, thus all these people are willing to continue dealing with me from a distance.

With my wife's work, the case is even more interesting. With a background in travel writing, journalism and teaching, she opted to try her hand at freelance writing from Oaxaca. There are plenty of interesting jobs teaching English available, however the pay scale is on the low side.

Amazingly, Serena has built a clientèle that delivers decent paying work to her just since our arrival. She has outstanding credentials as a writer, and she can deliver the goods. She sifts through writing jobs offered from a variety of sources, including craigslist. It does take a lot of time and patience for her to find decent gigs; I'd say that 98% of the writer listings on craigslist are looking for a freebie.

As it took me several years to build a viable client base, I'm fairly amazed at the work Serena has been able to generate in short order.

An important consideration in any work from abroad scheme is how to get paid? The easy, surefire answer is to use Paypal. Both Serena and I bill clients through the online payment service with no problems.

As some of my clients are businesses that prefer to pay by check, it's incumbent upon me to maintain some accounting functions stateside. Here again, I recruited a trusted associate of many years standing to handle deposits, payables and some basic office traffic directing. He puts in an average of 4 - 5 hours per month (my business is small and simple), and I pay him well for it--he provides a critical lifeline to commerce in the U.S. and is truly a key man.

I'll conclude that it's quite possible to freelance from abroad if one is highly motivated and has ample resources to launch the whole venture. Good luck to any who try! Anyone with questions can post a comment and I'll answer as best I can.

Steve Lafler


Anonymous said...

Excellent article Steve! Thanks for all the detail!

How does it feel to be out of the direct line of the Bush administration? What's the Mexican political climate like?

Steve Lafler said...

Between the Bush Cheney gang spending untold billions on their failed war, and the housing bust, the dollar does not go as far in Oaxaca as it did even a year ago. However, the price of goods and services here are quite reasonable.

The government of this state is deeply corrupt; the good news is that the people of Oaxaca have tremendous heart and always try to improve conditions.
On the street in Oaxaca, I feel pretty safe. As in any city, you keep your wits about you.
Private citizens are not allowed to own handguns.

Steven said...

You are certainly fortunate to take you work with you. I think more people in your position who earn the same salary where-ever they live, should look at moving to lower cost of living places. My view is that exchange rates give misleading salary comparisons because they do not reflect salary purchasing power differences. Exchange rates are volatile as they are based on short-term factors and are subject to substantial distortions from speculative movements and government interventions. Salary Purchasing Power Parity (SPPP) is the rate of salary purchasing power given the relative cost of the same basket of goods at the exchange rate versus one US Dollar. SPPP conversions allow cross-country comparisons of salary levels free of salary survey market and exchange rate distortions. You can get an accurate SPPP comparison of your equivalent salary in another country using

Anonymous said...

Great info! I love your new paintings. I can't wait for the next graphic novel. I too have avoided a day job for 20 years but the music business is not about music anymore. I enjoy your blog on Mexico.... Makes me want to get the hell out of the USA before we get another 4 years of criminals running our country. Don't you miss the SUV driving big gulping housewife cutting you off on the freeway while she is yacking on the cellphone at the same time she's checking out her in-bred face in the mirror all to just return a dvd at the Blockbuster 7 miles from her house????? hahahaah

Steve Lafler said...

Hey Eric, I don't miss the morons in their SUV's, no sir, but I gotta ask-- HAVE YOU EVER DRIVEN IN MEXICO?!
No? Imagine real life demolition derby with a bunch of toddlers on coke.
Actually, it's better than driving in Boston, where it's more like greedy murderous adolescents on speed!

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