Building a Spanish Silicon Valley

Living and working on the Costa del Sol has many advantages, not least 300 days of sunshine a year. The overall lifestyle is very different, in the Winter you can snow ski in the Sierra Nevadas above Granada and jet or water ski in the Mediterranean in the afternoon. The availability of fresh fruit and vegetables and the food miles they travel is far less than most places with a very short time from field to table as well.

Driving around the Costa del Sol, actually looks a lot like driving around Silicon Valley in California, even a lot of the place names are the same, to be clear California got the names from countries like Spain, not the other way round.

Back in 1992 the City of Malaga and the Junta de Andalucia started the tech park just to the north of Malaga next to the airport. Since then many companies have opened up offices in and around the tech park and the local area, once such company is VirusTotal, found in 2004 and acquired by google in 2012. Many internationally recognized companies now have offices, such as Oracle and Accenture.

Part of that is connectivity, Malaga airport is literally 20 minutes from the Tech Park. Malaga airport has as much runway capacity as London Heathrow, with none of the restrictions around flight times and is currently at 20% of the volume that goes thru' Heathrow. Another part of connectivity is internet connectivity, I wrote about this several months ago.

Most recently a number of existing and new companies have announced significant investment into the Malaga area, google announced the creation of a Cyber Security centre. Followed in January 2023 by Oracle are both examples of existing companies, with AES being the most recent new arrival.

In the Autumn of 2022, direct flights from Malaga were announced, technically it was a resumption, United announced three times a week flights to Newark airport in New York and just this last week the first tickets went on sale.

Spain provides lots of incentives now for people to come and work in Spain, historically Spain had the Beckham Law, named after a certain footballer and essentially means if you haven't worked in Spain are not a Spanish citizen and have a job to come to you can move to Spain and earn upto 600K/year and pay only 24% tax.

Spain also has the concept of Autonomo aka self-employed, for those that are familiar with IR35 in the UK it is a far more friendly version of that to actively encourage people. The what you can deduct is more expansive and the contributions you need to make to the social security system incentivize you by offering reduced contributions over the first two years.

Finally Spain recently announced incentives for startup companies and the Digital Nomad visa. The Startup Law again offers incentives to companies it has been estimated that the Startup ecosystem in Spain is worth €46B and the law is designed to support this and future growth. The details are all here.

Spain also has the Digital Nomad visa which is essentially designed for people who want to work for a foreign company whilst based in Spain. The tax model for Digital Nomads is based on the 24% for the first 600K/year in the Beckham Law.

If you want to learn more about living and working on the Costa I'd strongly recommend a read of this blog. I'd essentially end up repeating a lot of stuff that is here.