‘Spain is a hotbed of creativity and design’

In The Local's latest JobTalk feature we talk with Simon Gifford, a business consultant and lecturer at Madrid's prestigious IE Business School, about the current state of play for entrepreneurs in Spain and how a new online coaching platform can help start-ups.

'Spain is a hotbed of creativity and design'
Simon Gifford believes there is a huge hotbed of creativity and design in Spain, not to mention a pool of inexpensive talent.

Simon Gifford is a business consultant with over 30 years of global experience, including ten years as a senior global partner with Deloitte Consulting.

Gifford now runs his own consulting firm, Genesis, as well as lecturing at Madrid’s prestigious IE Business School.

Recently Gifford and co-founder  Victor de la Torre also launched a new online coaching platform for entrepreneurs.

The Local spoke to Gifford about that platform and asked for his views on the state of entrepreneurship in Spain.

What motivated you to start a web-based entrepreneurship coaching platform?

For the last 30 years or so, I have been very focused on strategy and decision-making consulting, mainly with large corporates.

Recently, I have become interested in the question of how to bring big style consulting to small business, because it’s clear the model of the big firms doesn't work for small operators.

Partners in big firms, for example, will ask $3,000 to $4,000 a day for their services and even junior consultants are charging $600 to $700 a day. And that’s out of reach for small or even medium-sized businesses, let alone new ventures.

But assistance can be critical for start-ups given that maybe five or more of every ten such businesses fail, whether because of lack of time, or knowledge or financial resources.

So I and one of my students at IE, who has deep experience of running IT projects, have developed Mashuari, an online platform for new ventures and early-stage business.

How does the platform work?

Mashauri is a four-step system based on best practice entrepreneurial thinking, and our tag line is: Rebuilding the world economy. One entrepreneur at a time!

It takes founders of a business through all the crucial steps from a concept to reaching a stable business.

Along the way, entrepreneurs learn to carry out tasks including formulating their business model, identifying and speaking to customers, planning financially, testing their model and obtaining funding. An investor-ready business plan is one of the outputs of the process.

Importantly, the system also provides real life mentors with business experience who interact with the venture and are able to challenge and push the entrepreneur.

How do you make money?

For the first concept phase of the project, we charge €20 ($26), and then a monthly subscription fee of €95 ($126) for the other three phases of the project.

However, we are currently offering early users a free first phase and a reduced price for after that as we continue to co-create the system with those early customers.

In terms of how long people need to use the service for, that depends on individual requirements.

The answer clearly depends on the venture and the time you allocate to the start-up. Some people do this part time, others jump in full time. Some have knowledge of the tools and methods, others learn as they go along. 

How does the future of the business look?

We also help organizations find funding so we are looking into getting investors involved in the business.

They will identify businesses that are ahead of the curve and are looking for funding and maybe even give guidance to those businesses in how to source and negotiate that early funding.

Those investors will be able to access our start-ups which, via Mashauri, have already come through a tried and tested system and so are more investor-ready than others who have not had the benefit of this experience.

Spain is often criticized for lacking entrepreneurial spirit. What's your view?

The rate of entrepreneurship is lower here than many similar economies, and there are a number of well-researched explanations for that.

First, entrepreneurship is not really taught in schools here.

Also, failure is frowned upon in Spain whereas in the US, failure is seen as an important part of the learning curve.

Something like 80 percent of Spanish University students wish to find a job in a large corporate or the public sector. The equivalent number in the US is less than 50 percent.

But there is a bit of a groundswell building here.

The business school IE (in Madrid) and IESE (part of the University of Navarre) both have built good entrepreneurial courses into their Masters of Business Administration.

Then there is the Telefónica offshoot Wayra which is doing a great job helping start-up technology businesses.

However, they only have capacity for a very small number  — probably 1 percent of all potential applicants.

I would like to think that Mashauri, as a scalable online business, can really help the other 99 percent as well!

In that way we are complementary to the accelerators or incubators as organizations such as Wayra are known — and we even have a system within Mashauri that supports these organizations manage their portfolio of ventures.

What is the current state of play after the introduction of Spain’s new entrepreneur law in June?

I think the government has their heart in the right place. They recognize that small businesses are critical to the economy and for employment growth – which is the key to rebuilding this economy.

Furthermore, new ventures are a critical source of innovation and new ideas.

However, they also recognize that we need some newer easy models to launch a business that does not tie the entrepreneur up in red tape and punitive tax bills before they have even made their first sale.

Our company, for example, is domiciled in the UK. That’s because registering a business there costs £15 ($20) and takes 15 minutes.

In Spain it takes €3,000 and a lot longer. It’s a bureaucratic nightmare.

So the new law is a step in the right direction, but these wheels grind very slowly.

It’s one thing to change the laws but you've got a whole lot of government workers and business systems built around them who may need time to change and it’s not going to happen very quickly.

Combined with a relative low level of venture capital and angel investors – this is not the easiest place to start your business.

Finally, what can Spain offer to start-ups?

Spain still holds some major positives. There is a huge hotbed of creativity and design and a lot can be built on that platform of competencies.

There are also lots of people with great skills and frankly it’s an inexpensive market right now because of the unemployment problem.

It’s sad to have to say that, but that does not mean we should not use that competitive advantage to start creating something special.

Tourism is also very strong here, and there have to be a lot of great opportunities there, especially when using technology to unlock that potential.

I know the hotel industry does not like organizations like Airbnb — but we believe it is better to use efficient web-based technologies and stimulate tourism in general.

For technology-based companies in general, including web-based businesses such as Mashauri which are potentially global in reach, Spain is as good a place as any to start up.

And if you can tap into inexpensive talent here, then maybe that can even compensate for some of the additional bureaucracy costs.

There are opportunities in Spain without a doubt.

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‘Hard to stay afloat’: Is working for an English language academy in Spain worth it?

It's the go-to work option for countless anglophones in Spain, but is teaching at an English language academy still enough to pay the bills in a climate of rising prices, stagnant wages and a shift to online learning platforms?

'Hard to stay afloat': Is working for an English language academy in Spain worth it?

Traditionally seen as a type of gap-year experience for recent graduates and/or those seeking adventure before settling down to a more traditional career path, English language teaching in Spain has becoming increasingly popular as a long-term career.

A high quality of life, a more favourable climate and generally lower living costs have always made Spain a popular destination for English language teachers, with Spain posting the highest number of job advertisements for teachers among European countries.

As a result, many of those working in the industry see it as somewhere to further both their professional and personal lives.

However, poor job security, stagnant salaries and issues surrounding the long-term sustainability of language academies have plagued the sector for years.

The recent impact of the Covid-19 pandemic and the current rise in inflation has further compounded these issues, with many teachers considering their long-term careers in Spain.

Teachers working for private language academies in large cities such as Madrid, Barcelona, Valencia and Sevilla can expect to earn between €800 to €1,400 a month after tax for about 20 to 30 hours of class time per week.

One teacher told The Local Spain that despite working as a profesor de inglés for almost a decade, his academy salary had gone down dramatically in real wage terms, following a salary cut during the pandemic which made it “hard to keep my head above water”.

“I was working as a teacher for nine years but felt the need to leave the profession as the hours I needed to work were affecting my mental health. During my first three years in Spain, I was able to get by on my salary. Since then, I have increased the number of private classes gradually, I save the same a month as I did when I first moved here, but have to work an extra eight hours a week to be in that situation”.

READ ALSO: The pros and cons of being an English language assistant in Spain

As of 2022, the minimum monthly salary stands at €1,166 gross for a 40-hour working week, meaning that someone working as an English teacher can expect to earn more or less the minimum wage based on their contact hours, with many opting to teach privately in order to supplement their income.

In addition to this, most teachers are hired on short-term indefinido contracts, meaning that they only earn a monthly salary for nine months of the year, resulting in many taking on summer work to maintain a year-round monthly income.

While short-term informal contracts and a relatively manageable monthly salary may have appealed to single, twenty-somethings seeking a few years of fun and adventure in Spain, for those looking to support a family or get on the property ladder the precarious economic reality of English language teaching has seen many reconsider their long-term career goals.

“I rented when I initially moved here but now I’m paying off a mortgage which has gone up due to interest rate rises,” another English teacher told The Local Spain. 

A traditionally in-person industry, the pandemic forced many academies online and, due to increased competition from online language learning platforms along with a paradigm shift in terms of hybrid and remote study and work, academies have struggled to replace students lost to this new language learning environment.

As a result of this, some teachers have seen their weekly teaching hours reduced as academies simply cannot guarantee a full schedule, putting further financial pressure on teachers.

teaching english spain

Poor job security, stagnant salaries and issues surrounding the long-term sustainability of language academies have been plaguing the industry for years in Spain. Photo: Thirdman/Pexels

One teacher with over seven years working experience for a large English academy in Madrid told The Local that “a few years ago our company began the long process of trying to cut our supplements and basic wage”.

“We were backed up by our comité, (representative group) but after about a year of negotiations, reductions (and redundancies) were made. At the time it cut about €250 from my meagre wages.”

As is the case across Europe, the level of inflation in Spain has risen sharply to about 10.5 percent as of September 2022. Combined with rising energy prices, more and more teachers are finding it increasingly difficult to live off a salary in some cases of just over €1,000 a month.

With the average cost of renting a room ranging from €400 to €500 in large cities, some teachers are choosing to cut costs in terms of their living standards to make their salaries stretch further.

Another teacher told The Local how “while I still go out at the weekend and buy the food I want at supermarkets, the increase in rental prices has meant that I’ve stayed in a less-than-ideal room, rather than finding a better room – due to not wanting to pay significantly more in rent”.

While the challenges facing English teachers in Spain are not unique to their line of work, this latest set of drawbacks should be factored in by anyone considering making a move here or teaching long-term.

Such economic realities are difficult to ignore, but that’s not to say there isn’t a lot English teaching can offer someone looking to gain some valuable work and life experience while also enjoying the hustle and bustle of life in Spain.

Article by Cormac Breen