Portugal has cemented itself as a tourist hub, a paradise for the digital nomad community, the go-to country for retirees and families, and has become a firm favorite with investors. But the hype surrounding Portugal just keeps growing.
In 2016, Portugal took a significant step towards boosting its startup ecosystem by launching Startup Portugal as a crucial component of its national plan to promote entrepreneurship. This initiative aimed to facilitate the growth of startups by providing them with better structural support, funding, and opportunities for international expansion.
According to the tech platform Start Up Genome, it reports that Portugal’s startup scene is thriving, with a current count of 2,200 registered startups and more on the horizon. The ecosystem’s expansion is evident as it secured $1 billion in funding in 2021, displaying a growth rate of 100 percent from the previous year.
In the past seven years, Portugal has really geared itself up as the ideal place for businesses. Take Web Summit, one of the largest tech festivals in the world, relocating to Lisbon in 2016, or the influx of start-ups that are attracted by the unique and efficient tech ecosystem.
The high quality of life, attractive visa schemes (such as the Entrepreneurship D2 Visa or Tech Visa), and incentives from the Portuguese government designed to attract foreign entrepreneurs have all aided in putting Portugal firmly on the map. The fact that Portugal has the same time zone as the UK, is an affordable country, and has excellent infrastructure are other reasons why opening a business in Portugal could seriously be worth considering.
When it comes to hiring Portuguese employees, you’ll find that the level of English is excellent, meaning that there should not be any language-barrier issues. Alongside this, Portugal is home to many world-class universities, so setting up an effective international team should be relatively straightforward.
While the Portugal Golden Visa is coming to an end soon, the Portuguese government’s introduction of the Digital Nomad Visa in 2022 and it’s a long-term commitment to attracting foreign entrepreneurs continues to position the country as having a friendly position regarding immigration and innovation.
Regarding the future of the Portugal Golden Visa, the final proposal was released on 14 April. This revealed that the new law will only go into effect when published in the official journal and that there will be no retroactive effects. Simply put, there is still time to apply for the program, and Golden Visas that have not yet been received are protected.
Alongside this, the stay requirement tule of seven days per year will remain in place and the renewed visas will have the same flexibility as the ARI, even though they will be reframed under the D2 Visa.
Considering the various stages of the legislative process, it’s expected that this approval process will take at least 35 days, assuming everything progresses smoothly.
How to Open a Business in Portugal
Opening a business in Portugal, as in any country, can take time and effort, and making sure that you complete the setup and registration of the company is fundamental. Working with an experienced lawyer and a tax accountant will ensure that everything is in order.
For entrepreneurs interested in setting up shop in Portugal, here are some top tips to consider.
- Ensure that you are legally allowed to open a company in Portugal. The Portuguese government has visa options tailored toward foreign entrepreneurs, such as the Entrepreneurship D2 Visa and Tech Visa, that make securing residency in the country and setting up a business easier. You will need to have a NIF number (Portuguese tax identification number) and a Social Security number (NISS) and should open a Portuguese bank account.
- You’ll want to have a strong business plan that takes into account the Portuguese market and your potential competitors.
- You should also have a name for your new company and address ready, as you will need both for the official company registration.
- You’ll also need to establish which type of business you would like to open. For example, if you are the sole owner, options include setting up a Single-Member Liability Company, a Sole Trader company, or an Individual Limited Liability Establishment. If you will work alongside partners, you can choose from opening a Private or Public Limited Company, a Cooperative, a Partnership, or a Limited Liability Company Partnership.
- Companies in Portugal will need to register with the Portuguese Trade Register. You must have your company incorporated by a representative and a power of attorney.
Start-ups Doing the Rounds
As we’ve mentioned, Portugal has become a hotspot for startups, becoming somewhat of a European Silicon Valley – the design for the impressive bridge in Lisbon is also based, in part, on two bridges from San Fransico. The Portuguese capital, in particular, is the most popular city for start-ups and businesses, but, increasingly, Porto and Braga have been gaining in popularity.
Successful start-ups include Unbabel, which is revolutionizing the world of online translation, Uniplaces, which has quickly become one of the go-to platforms for students looking to rent a place, and Prodsmart, which streamlines processes for small companies – and secured funding from 500 other Portuguese start-ups before it was even launched.
For entrepreneurs looking to open a tech company in Portugal, the good thing is that the country has already become somewhat of a tech hub. Particularly for entrepreneurs based in Lisbon – and increasingly Porto and Braga – a top tip to getting started is to attend networking events and talk with people that have gone through a similar process. What challenges did they face? Do they have a recommendation for a good lawyer or accountant that can help you get set up? What are the top advertising sites to attract top talent? This is a great way to become integrated into the Portuguese market and get settled in the tech ecosystem.
Portugal is Firmly on the Radar
Opening a business in Portugal could be a smart choice for entrepreneurs with a solid business plan. The country is already well on the way to transforming itself to be the Silicon Valley of Europe. And, with the Portuguese government actively encouraging foreign entrepreneurs to their shores with their visa schemes, coupled with the affordability, and relatively straightforward route to setting up a business, it looks set to skyrocket in the coming years.
Article prepared by Global Citizens Solutions