Spoiler alert: Mexico city is a better outsourcing (nearshoreing) partner than the international marketplace would suggest, allowing very good value in a great number of industries, software and manufacturing to name a few. While in absolute terms the software is bit more than in India, and manufacturing a bit more than China, I feel it is a better value due to ease in doing business, both by proximity and greater cultural similarities. There are pit falls of course, but they are fewer and more easily avoided or mitigated, which I describe below. Many things surprised me, and because I suspect there are a great number of Americans with my profile, see below, I am writing this, half-travel story, half-how-to primer, as a heuristic guide for the similarly minded, who aren't terribly experienced international business travelers or tourists, and need more basic expectations that are not well covered in the typical travel books and blogs. (If you are a seasoned business traveler, this is not for you, you will find México quite easy, the observations below obvious, the stories tepid compared to greater extremes elsewhere)
I traveled to Mexico City in November of 2015 on a business trip to evaluate a software development partner, (I later invested.) I have been to a handful of other countries, primarily in the Caribbean and Europe; I have visited Mexico, but the tourist spots, Tijuana, Cabo, Cozumel…, and speak a purely survival level of Spanish, a mere vestige from high school and college verb-tense cramming but never calcified with any real world practice.
Mexico City isn't just big, it's huge, the largest city in the Western Hemisphere, a banal factoid until one descends for 15 minutes into MEX and sees nothing but lights for miles in every direction. In physical ways it reminded me of Lake Tahoe, high elevation, actually 1000 feet higher, roughly the same size and oval dimensions (12 x 22 miles), surrounded on all sides by 4000 foot higher peaks, some with snow, and that the speed at which one travels though Mexico city rivals that of a kayak.
Mexico City is close. From SFO, direct flights can get you there in as little as 4 hours and 5 minutes. It is almost certainly the cheapest 4 hour flight available from the Bay Area, often not much more than $300 round trip. My friend Arturo and I flew United, and opted to pay a bit over $1000 for first class (in part because we had to change our non-refundable tickets and found that for not much more than the penalty fees we could upgrade). I am a big guy, 6'2" and wish my lbs. weight were in kilograms, so I feel it was a good value. On the way back we sat in front of Filipe Calderon, Ex-President of Mexico, and since one of the benefits of first class is business relations, what better opportunity than this to display my likeable gringo persona? But my friend Arturo, completely bilingual and bicultural, suggested it wasn’t appropriate, so I refrained from any business or international incident that might have transpired.
22 million people live in Mexico City, roughly 1 in 6, but 1/3 of the GDP is centralized there, so it is noticeably wealthier. Since nearly 100% of the political power is centered there (in a stark contrast to the US, where the founding fathers initiated their second revolutionary act, separating political power from New York, but keeping the economic power intact and largely unmolested) it is noticeably the favored child. There is a vibrant middle class, something conspicuously absent in Tijuana or Cabo. Even the lowest classes don’t sell Chiclets, or equivalent trinkets, but are actively working the intersections selling things you might want, bottled water, chips, phone chargers… (I was always amazed that in Cabo, on the beaches no one sold cold beers, suntan lotion or rented umbrellas and chairs, just giant vases and the like, probably the most unless thing possible for a carry-on traveler. It took me a while to realize the reason for this was not some stunning lack of basic marketing but poverty lacking not just of money but of sufficient political power, basic rights, to compete with hotel interests, even indirectly, and were left to fend for themselves by selling not much more than fists of sand.) So I never felt the annoyance or wealth-guilt one gets from persistent peddlers and beggars (which includes white timeshare sellers, let's be fair!), instead I saw a society, struggling perhaps, but making an honest effort to hustle and provide value, actively providing service, parking cars, waiting tables, with a honest effort to satisfy the client. At an artist's bazaar there was no rug salesman, buy-this-now-and-go-away pushiness, no bait and switch, no hollowed-out-item trickery. No short changing or slow count (like in Italy). No passivity, hustling without being pushy. In a world bursting with entitlement, one has to really respect a genuine desire to actively earn ones keep.
Mexico City feels much more European than the rest of Mexico, from the older architecture, first-world buildings downtown, even surprisingly new cars. (A result of near draconian, but necessary, governmental assaults on pollution and traffic, old cars were phased out, the blue smoke belching VW beetle cabs were replaced by Nissan Sentras; the size, age and type of cars (VW, Peugeots, Ibizas) looked surprisingly like what you would see driving in Paris.) Greetings even include kisses on the cheek, French style, uncommon in the rest of México. Like Europe, though maybe more so, dress is more formal, no shorts or blue jeans, collared shirts and slacks minimum, suits were worn even by some cabbies and chain-restaurant maître d's. Women wore skirts, nylons and heels, even with the warm weather and cobblestones. The kissing and dress reminded me of Parisian women.
Finally, stuff in tourist areas seem in constant disrepair as if any maintenance violated some fiat. In Mexico City, I don’t remember seeing anything mechanical out of order, but several things were being fixed, built, or painted. My hotel lost power for a moment but the UPS kicked in so fast the lights never really went off. The curbs and sidewalks were definitely more chipped and jagged, and I can remember a couple ankle threatening, rebar-laced potholes that demanded one watches ones feet at all times, but it was nothing compared to the impaling, OSHA nightmares I have seen in Cabo and Tijuana.
Good English skills were surprisingly common. I expect it in tourist areas, of course, and in the business hotels in which I stayed, all of the employees spoke English quite well. Like tourist areas, the highest paying jobs seemed nearly perfectly correlated with English speaking ability. But I was able to talk to cab drivers in English with better success than my horrid Spanish. But communication is not language, but the desire to communicate, if people want to communicate, they will find a way to do so. There was never a case that someone refused to talk to me because my Spanish was poor.
You notice the elevation the moment you land, and throughout the trip, it is hard to keep your energy up, so don’t over extend yourself. But what you really notice is the acrid pollution that tastes a bit like a smoky bar with a small electrical fire. One puffs harder walking though a huge airport and inhales that much more pollution which ended up being the one unpleasant thing that as a relatively rich business traveler I could not buy my way out of. I could rent nicer cabs for cheap, hotels were of international class, but with every breath there was the not overwhelming but persistent, mild sore throat-causing smog. Having gone to school at UC Riverside in the 80's, when leaded gas was still sold, I am no princess green-lung and during summer, the pink smog of Riverside was worse. At least you could see the surrounding mountains though the thin gray smog of Mexico and it didn’t make your eyes constantly tear. But I only mostly got used to it and my voice didn’t go back to normal for a couple days after I returned. But the smog got much better one day when we had very light rain. (The rainy season is from May to end of October, so we were entering the dry season when the pollution is much worse), and while I would not time my trip based on the weather, if given a choice I suspect I would prefer the rain, as much of a daily hassle that might be, including increased traffic. (Arturo disagrees).
Traffic is even worse than in L.A. where, while hopeless, it is largely confined to freeways and major thoroughfares. Imagine traveling from Los Gatos to Fremont, (two towns maybe 20 miles apart) but never on an interstate or expressway, always on work-around routes in residential areas. There are highways of course, but they are so jammed much of the day that even the smallest of streets sees though traffic. Few parking restrictions means that roads that could have been designated as 3 one way lanes are buttressed by parked cars with only a narrow passage in between. To deter traffic back to the freeways, stops signs were erected at even the most minor of intersections. They were ignored. (I was in a car that blew through a stop sign while a police officer was visible, there wasn’t even the deferential stop or yield to the officer, no ticket was given, and the driver was never worried.) So speed bumps were put in. That succeeded in slowing traffic, but it makes the commute ever more unpleasant. While I am told that public transportation is surprisingly good, the best answer for the traveling business person is to phone for a cab and be patient on the ride. Find one area of Mexico City and enjoy just that. The only long drives we took were to the airport, and when we arrived, at about 8 PM, traffic was not bad, and nonexistent on our return at 5 AM, so catching off-hour flights is recommended.
Drivers had a higher level of aggression, but not hostility. Higher talent too: talking on cell phone while driving a stick shift and weaving lanes was commonplace, yet I only saw one very small accident. But drivers don’t yield to pedestrians, so walking while looking at your smart phone is not recommended, even in a parking lot.
There are 16 boroughs; we stayed in Coyoacán, in the south, because that is the neighborhood surrounding UNAM and satellite software companies founded by graduates. But even with the cobblestone streets, bohemian artist culture, hip restaurants and budding software/ VC community, it would be quite a stretch to compare it to Palo Alto. A major difference is the open space. While Palo Alto and many U.S. cities have sizeable tracts of parks and open space, Mexico city has very little. (In my mind a central park is a critical thing for a great city, (New York, Paris, San Francisco, etc.) to have.) Furthermore, as no one has front lawns or porches; every sidewalk has a wall on one side and a crowded street on the other, so even while Mexico City is not dense vertically (there are only a few places with tall buildings) one gets a claustrophobic feeling nearly everywhere.
We visited UNAM; founded in 1551 and a world heritage site, it is widely considered the best school in Latin America. UNAM looks like a giant UC or California State school, (boasting a quarter of a million students, it is larger than all of the UCs combined) with the large quad areas, academic style buildings, even a giant mural.
Mexico City is cleaner than other parts of Mexico I have been to, I'd even argue it is a bit cleaner than Paris, even certain parts of San Francisco, but nothing like Vancouver, Tokyo or Zurich, I was, however, a bit dismayed that the campus was a bit more littered than comparative schools even with omnipresent groundskeepers. The bottle tops were crushed and rusted which meant they must have been there for some time, and it was so unnecessary and uncharacteristic for such a heralded school doing so much else right.
We also visited the National Museum of Anthropology, amazing, a must see if you are in the area.
(I'll let the link do the talking). Outside street vendors were selling snacks, one was dried crickets. I am daring, I tried one. It almost made me ill. Everyone says maybe I got a bad batch, crickets are a delicacy, what do you expect from a batch sitting out in the tropical sun all day? Perhaps, but I don’t want try a fresh batch. It was the only bad food of the entire trip, however.
A question that comes up every time I mention my trip to Mexico city is, did I feel safe? I did. I was greatly helped by the fact that my friend Arturo, a Mexico city native, was with me almost the entire time. Still, basic common sense security precautions go a long way, (I was able to break these guidelines because I was with Arturo), don’t go out by one's self at night, don’t hail a cab from the street, (a string of temporary kidnappings where victims were captured in bogus cabs and driven to ATM machines and $300 ransom paid, were common a few years ago, they seem to have been suppressed) don’t be flashy, don’t leave your wallet lying around, be extra cautious at tourist sites, basically don’t do anything stupid. I brought a money belt, critical for visiting tourist sites in southern Europe. I never used it.
But it is obvious from the somewhat bunker like architecture, and the "Missing 43" scandal (an excellent write up can be found here http://time.com/author/ana-francisca-vega/ ) that Mexico has had and is struggling with violence. Violence in Mexico City, like New York City, was endemic in the 70s and 80s. Also, reforms like an very visible police force (squad cars and motorcycles always keep a blue blinking light on, I went on one trip where I saw blue lights perhaps every 200 yards) have tamed it substantially. The violence is almost entirely drug related, and that has largely moved to the border regions, leaving most of central industrial Mexico (Monterrey being a large exception) and tourist areas less affected. The ramp up in violence was much more reported than its demise but statistics show a dramatic reduction, in some areas 95%, and tourists haven't been especially targeted to date. Also for perspective, drug violence in, say, South Central L.A. or Oakland continues unabated, and just a few miles from places where it is quite safe for a tourist to visit.
Arturo's brother, Beto, owns a several restaurants including one that was originally a hospital built in 1521! We were there during student protests, which were only a block away. Helicopters buzzed overhead, roads were temporarily closed, but the protest was not violent, in a type of "pep rally" stage and that non-existent disruption proved the largest we had on the trip.
Beto also owned a cantina, Coyoacana, with wonderful food (If you get a chance try the chistorra con queso, a delightful sausage and cheese dish. For desert try the natialla, a soupy custard) and we visited it one night. While I quickly noticed it was a bit tighter, smaller tables closer together, what really set it apart was how merry it was, the likes of which I have never seen. Two mariachi bands played all night and everyone sang the songs, danced and cheered. (Yes, Mexicans really do like mariachi bands, it is not a cultural relic they pull for for tourists, though the bands they have far surpass anything you will see at even the best Mexican restaurant here. We even saw a third mariachi band at a birthday party later that evening.) Beto tells me that in 6 years he had only 2 fights. On New Year's Eve, 100% of all the employees showed up for work, New Years Day, after working nearly all night, same 100% showed up.
If I were to build a software company, say to build apps, in silicon valley and need to hire staff, I'd recruit individuals locally, including project managers. In Mexico, one would be well served to go to a established company that specializes in apps.; the same team that would take weeks in Silicon Valley would take many months in Mexico. One reason is that if someone has 10 years of coding experience in Silicon Valley, it is common and approved practice to consult, thus there is a always an excellent, if pricy, pool to quickly collect talent. In México, the same talented person nearly automatically gets promoted into management. As a result, both programming and project management is excellent but the best talent is secured in permanent positions at established companies. Mexicans are quite loyal so they don’t jump companies much, and there is no consultant pool to speak of. One would think that the established companies would leverage their near monopoly position on talent with huge fees, but I the markup is remarkably small, especially given the boots-on-the-ground and hands-on attention they give.
That said one cannot just call up a company, sans introduction, and say "you have what I need, I got money, let's partner," as you could say at a trade show. Mexicans are a cautious lot, more so than the environment would suggest, (fraud is not rampant as would be in say Nigeria, Russia or even Greece) and they won't partner without an introduction or at least a lengthy serenade. As a salesperson in Silicon Valley I am naturally assertive and impatient, so I find this a bit frustrating, but it can be mitigated with a bit more planning and partnering with a bi-cultural company that has a the connections one needs.
What impressed me that most is that one could ask for directions to any person, of any social class, a suited businessman in a Mercedes talking on his cell phone, a family who lived in a center divide on an expressway whose kids were literally playing in the street a foot away from racing cars, and either would very graciously stop what they were doing and give you their complete attention and try their best to help get you to where you wanted to go. One of our cabbies stopped the car 6 times, to get out of the car and knock on doors in a residential neighborhood where the occupants all tried to help direct us to our destination. (Mexico city is so massive and rather sprawled, even the cab drivers don’t have it wired. But there the sprawl of LA would be merely a suburb.) The fare for a 1 hour ride? $7. A newer cab with suited driver picked me up from the hotel at 4:30 AM sharp. $20 to the airport. Tremendous desire give great service and value, biggest reason I want to do business with Mexico.
I can't wait to go back.