Manuel Martinez-Herrera led BetterCloud's Mexico operations, overseeing a team of 60+ employees focused on engineering and product development. Originally a lawyer from Spain, Manuel transitioned into the tech industry and has extensive experience helping companies scale internationally. At BetterCloud, he spearheaded the company's expansion into Mexico, growing from zero to over 60 employees in under two years while maintaining strong cultural alignment between the US headquarters and Mexico office.
Q&A
Tell us about your background and how you ended up in the tech world.
I'm originally from Spain, born in Madrid, but I grew up between Spain and the US since my mom was American. I'm actually a lawyer by trade - I went to law school first in Spain with an exchange program in France, then worked at a big Spanish law firm with alliances in Latin America. I even spent seven months in Buenos Aires, which was my first introduction to the region.
After that, I went to law school in the US and started working at a big law firm in New York doing corporate work, privacy work, and international work for almost six years. Then I moved in-house and found myself at Namely, which was a fast-growing HR, payroll, and benefits software company in New York. We went from $20 million to $60 million ARR in two years, and I started the legal team there.
From Namely, I joined BetterCloud in October 2018 to start their legal team as well. That's how I eventually ended up leading an office full of engineers in Mexico - quite a journey from law!
About BetterCloud
Can you give us a quick background on BetterCloud and your current focus?
BetterCloud was founded at the end of 2010 out of Atlanta. We basically help IT manage their SaaS applications in several ways. One is spend management - helping companies understand what applications their employees are using, how much they're paying for them, when contracts renew, and whether they're overpaying for unused licenses.
Our bread and butter since the beginning has been user management, onboarding, and offboarding. We help IT onboard users into all the different applications they need through automated workflows, and we do the same for offboarding when employees leave. We also help secure those applications through data loss prevention and ensuring proper document sharing permissions.
It's all about helping IT manage their SaaS stack and helping finance with their SaaS spend.
Expanding to Mexico
How did you arrive at the decision to expand specifically to Mexico?
We had a successful exit in summer 2022 when Vista Equity Partners bought a majority of the company. Once we became part of their portfolio, they looked at our practices and said, "Out of the 80-90 companies in our portfolio, there's only two - you being one - that has all its R&D in the US. You should seriously consider opening an R&D center outside the US."
We went through due diligence on several countries. We quickly discarded India because of time zone and travel complications for our first international experience. Our initial three targets were Argentina, Poland, and Ireland.
Argentina was attractive with great talent and English levels, plus the time zone works well with the US, but the economic uncertainty and difficulties with moving money in and out made it too risky for a PE-backed company.
Poland also had excellent English levels and lots of software engineers, but being right next to Ukraine during the war made us hesitant about opening an office there.
Ireland we discarded because it's too expensive - with Facebook, Meta, and everyone there, you'd pay almost the same salaries as the US.
Then Mexico came as a dark horse and we quickly realized it was awesome. The time zone aligns perfectly with US time zones, you can get anywhere in the US from Mexico City within four to five hours, English levels are really good, there's lots of talent, and economically it makes sense - you can pay really good salaries that are significantly cheaper than the US.
Plus, our CEO knew I had connections in Mexico, and he wanted to send someone from the "mothership" to bring our culture and values. He came to me in early November and said, "Do you want to do this? You need to tell me within three days." After talking with my wife - and it's funny, when we got married we had this plan to live somewhere else after 10 years, and Mexico was one of our potential destinations - we decided to go for it.
Talent and Hiring
How would you describe the talent pool in Mexico for engineering roles?
It's been really great. We have 60+ people in Mexico, with 40+ in engineering and about 4-5 in product and design. The talent has been excellent.
What we found is it was easy and quick for us to find really good junior talent - what we call L1s and L2s in our leveling system (L1, L2, L3, then senior, staff, principal as L4, L5, L6). We were very successful very quickly with junior talent and managers.
Where we struggled more - and there is good talent, it's just harder to find and you have to pay more - is that mid to high-level individual contributor level: senior, staff, and principal engineers. Part of our challenge was we require being in the office three days a week, which was important for us to create culture and enable teams quickly as we were hiring many people simultaneously. Some of the more senior talent didn't want to come to an office, though I think that's changing.
The sheer number of software engineers in Mexico is huge. UNAM graduates about 5,000 engineers every year, and there are many American companies coming here. The talent exists - you just need to make sure you have an attractive proposal for them.
What specific channels worked well for recruiting engineers?
UNAM is one great example. Tec de Monterrey, which has a big campus in Mexico City, is another excellent source. The Polytechnic is really good too. There are many quality engineering schools in Mexico City, both public and private.
When we first arrived, we used external recruiters, but that wasn't very successful. They didn't understand our culture and were bringing us IT folks when we needed software engineers - there's a difference.
Where we became very successful was when we hired our own internal recruiters, taught them BetterCloud's ways, culture, and values. We had up to three at one point, now we have two - Anna and Fer - and they've been fantastic. They've recruited over 90% of the folks we have here.
They did smart things like talking to universities, going to their events, joining events that Google was throwing here, and hosting our own events. We were also very successful with referrals. We had one junior software engineer join, and within 10 days we hired his best friend, then the best friend's best friend. When people are happy, they want to bring their people. The most successful thing we've done is relying on our own internal recruiters who understand how we recruit and understand the company.
Entity vs. Contractor Model
How did you decide to set up a full entity rather than using contractors?
We debated this a lot internally and decided at a board meeting to go with our own entity. We were looking at two models: hire through a third party like Deel or Remote, or go full-fledged and open our own entity.
Because we knew we were going to grow very quickly - we wanted 40 people within six months - one board member was very adamant. She said if you're hiring five people, either model works fine. But if you're going to have so many people and you want them to feel like part of the company with your culture, you're better off having your own subsidiary rather than having them employed through someone else. You can give them the same packages as in the US, which makes them feel better.
The other consideration was that if you do the contractor model and later want to switch to your own entity, you have to pay breakup fees. Knowing it was a long-term thing and we wanted to grow quickly, it made more sense to do it from the start.
It took us about four months to be ready to hire with the entity, getting the Social Security number, tax number, and everything set up. But since we started in December 2022 and wanted to be able to hire by May-June 2023, it was all within our timelines.
My advice is similar: if you're just testing the waters and hiring one small engineering team of seven to eight people, the third-party approach is fine. But if you're all-in and know it's going to be important for you, the sooner you have your own entity, the better. You put the pain upfront and then it's smooth sailing, versus having to switch everybody in the middle and explaining what's going on.
Technical Stack and Specialization
Do you have any specialization in your tech stack?
We're mostly a Java shop using React on the frontend. In Mexico, there's a lot of Java talent, so that's been great for us.
However, we acquired a product from G2 that's built on Ruby on Rails, and that was more challenging. There aren't that many Ruby on Rails developers in Mexico, and because of that scarcity, it's more expensive. We didn't have to hire that many, so we were able to find the right people, but I'm talking to another company from Vista's portfolio who's mostly Ruby on Rails and they're struggling more because there just isn't as much talent in that technology. Java in Mexico has been super successful for us.
Advice for Companies Expanding to LATAM
What advice would you give someone considering expansion into Latin America?
I've been informally chatting with five or six companies opening offices in Mexico, and I always tell them the same thing. I sat down with one company recently - their CTO and product team came to Mexico City and asked me "What is Polanco?" I was like, "Wow, you want to open an office in Mexico and you don't know that Polanco is a neighborhood in Mexico City?"
You need someone who either understands the local market from the inside, like in my case, or from the outside, like what you guys do for your clients. You cannot just be the foreigner who doesn't speak Spanish and think you can just open an office. You need someone who understands the market so you make the right calls at the beginning.
It's not rocket science, and we don't know some secret. It's just knowing how the culture and market work because you're either from the country, you've done business there, or you've lived there. There are cultural things that can get lost in translation if you don't have someone to bridge that gap.
Make sure you either bring someone or hire a strong local lead to help lead that office and bridge the cultural differences. That's been part of my job - bridging the cultural difference between Mexico and our headquarters in the US.
Did your US engineering managers need calibration for hiring and managing international teams?
The first managers we had in Mexico were all local managers that we hired here to lead the teams. As we grew, we now have some managers in the US leading teams in Mexico, and that's actually been very successful, mostly because the individuals I'm thinking of are just high performers who would do great leading teams anywhere in the world.
But yes, there is some cultural proficiency needed. What's been very helpful is that these US managers come frequently to the Mexico office, spend a lot of time with their teams in person, hang out with them, and create personal bonds. They also get support from me and the people team here to understand the cultural nuances.
Connect33 is a full-service consulting firm specializing in market entry, expansion, and software engineering team building in Latin America. With extensive experience in the region, we help companies scale efficiently by providing experience-based insights and services with on-the-ground experts.
Our list of companies we’ve scaled with includes mid-to-large enterprises such as Apexon, Atrium, Bain, Braze, C3 AI, EPAM, phdata, Terminal, and more.
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