Our biggest news in the past few months has been the company’s relocation to Lisbon, from San Francisco. We still get asked a lot about why we decided to open our European HQ in Portugal having begun life in Silicon Valley.
It was at the height of the pandemic when travel had come to a complete standstill that we decided it was time to expand from the US and open our official European office in Lisbon. We landed at Startup Lisboa, one of the city’s very first accelerator hubs. Why did we trade the US for Portugal?
Rapid homegrown and international growth
There are so many great reasons to bring an ambitious, driven tech startup to Portugal’s capital.
The startup scene has been growing in Lisbon and since my first trip in 2020, we have witnessed that firsthand. In 2022, Portuguese startups were worth three times more than the market five years earlier, despite the challenges startups faced during the pandemic.
Part of Lisbon’s tech scene growth is because the country has one of the highest rates of engineers and developers per capita in Europe, coupled with the competitive advantage of relatively lower salaries compared to other neighboring markets. This is a huge benefit for growth when it comes to early stage startups.
On top of that, the influx of international tech talent towards the Portuguese capital rapidly turned Lisbon into one of Europe’s fastest-growing tech hubs, with dozens of startups such as Bounce relocating here, opening local offices, or launching from here.
For us, although we operate on an international scale, we really value the relationship we’ve been able to build with both partners and customers in Lisbon, and from these have received incredibly valuable feedback which helps us improve the product at a global scale.
Despite the tech scene’s exponential development in the last few years, the startup community here is still pretty tight, so it’s easy to get plugged into it through a few meetings. This is something we still wanted to experience even though we’d made the move here from San Francisco; we know that it’s invaluable to be surrounded by other like-minded people with exciting ideas.
Lisbon’s edge expands beyond the tech scene
We know that there are other European cities that have a reputation for being great homes for exciting new tech, but Lisbon has many benefits besides its growing tech scene that really make the city stand out. For example, there are a number of financial incentives that the country is setting up which will hopefully move the ecosystem even further in the right direction.
This is particularly great for startups at this moment in time; although some VCs have suggested there will be an increase in investments made later this year, to date globally there’s been a decline in VC funding by roughly 53% according to some reports.
Some incentives have had mitigated results
However, while there are a lot of great initiatives made available to startups in Portugal, they don’t always live up to their good intentions and there’s definitely a lot of work to be done to make them more appealing. For starters, many of the benefits are complicated to organise, and the startup visa, in particular, has been really challenging.
The process was supposed to take no more than 40 days, but it’s been more than two years and ours still hasn’t come through, which forced us to pivot and find an alternative solution.
This is incredibly dangerous to startups which have to fight for survival on a daily basis and any loss of momentum can have a disastrous impact. Likewise, it took a pretty long time to set up our entity too, another unforeseen hurdle that was far from what was advertised to us when we chose Lisbon as our relocation destination.
Startups and investors alike seek stability and predictability, so this is definitely an aspect that Portugal needs to address.
The unwavering attractiveness of Lisbon
Challenges aside, Lisbon is not only a fantastic city for existing tech talent, but it’s also a big selling point for candidates outside of the area. With the city’s warm climate, 2000 hours of sun per year, access to the beach, and creative environment that goes hand in hand with a thriving startup community, it’s a huge bonus for candidates who are looking for a company where they can make an impact.
There’s also a special tax regime where foreigners can have a flat tax rate of 20%, significantly lower than most of the rest of Europe and beyond. By the end of this summer, we’ll have relocated ten employees to the city, bringing our Lisbon office headcount to 30. Lisbon gives us an edge when it comes to recruitment.
Another, perhaps less often considered, benefit to opening an office in Lisbon is its time zone. Unlike much of the rest of Western Europe, Portugal sits on London’s time zone, an hour closer to the US time zones than continental Europe, which provides the added advantage of an extra hour overlap with our colleagues and external partners in NYC, San Francisco, and beyond. This is hugely important for staying in touch with our teammates and partners there too.
Bounce is thrilled to have set up shop in Lisbon, and we are reminded every day that this was the right decision. The Portuguese capital is incredibly dynamic, with one of the highest growth rates we’ve witnessed so far, a testimony to how much the city and country have to offer.
In the last 6 months, we’ve grown more than 200% in Portugal since last summer in terms of number of bags stored, with 7 new Portuguese destinations launched (including Sagres, Ericeira, and Evora) and more than 140 new store partners joining across Portugal.
Lead image: Portuguese Gravity