Why Puerto Rico is an ideal place to test your product and grow

When Google’s much anticipated Project Ara, the modular customizable phone that has yet to be released, announced its pilot program, none of the regular tech cities were mentioned. Instead, the tech giant went with a Caribbean island that boasts a population of over 3 million, Puerto Rico. Though the project fell through, Google still plans to utilize the island in future projects.

This is a surprise to those not familiar with the island but, truth be told, Puerto Rico has both measurable and immeasurable value to those looking for a test market whether for a product, service, even an app. It’s a sizeable yet workable market that is open to new ideas. Here are some benefits of doing testing in Puerto Rico:

U.S. ties

For over a century, Puerto Rico and U.S. have maintained a political relationship. Its current status allows for entrepreneurs both local, American, and international to interact in a multicultural place and experience both American and Latino culture.

If your startup is U.S. based, this means familiarity with the governing laws as well as the reassurance that documents and such will be available in English, no need to get lost in translation.

Free Trade Zone

According to the Puerto Rico Industrial Development Company, the island is home to largest “non-contiguous free trade zone (FTZ) in the U.S.”

There are other monetary benefits to the FTZ including payable taxes on good sold only in Puerto Rico and picking the lower amount in duties between a finished or ‘the aggregated value con raw material’, according to the PRIDC.

In other words, you’d be able to develop and test your product in Puerto Rico for a lower cost without losing any quality. Saving money, a must for any startup’s growth, can allow your company to be more flexible while on its try-out phase.

Packed Little Package

Puerto Rico’s mainland is about 100 by 35 miles plus a handful of keys and island-municipalities Vieques and Culebra off its coasts that add a few more miles to the measurements. If it sounds small, it’s because it is. However, according the latest U.S. Census estimate, Puerto Rico boasts a population of just over 3.4 million.

“When you really analyze the ecosystem in Puerto Rico, the market is so small and dense that you end up moving things faster than in the United States,” Alana Matos.

For your product, this translates into a workable area with a healthy amount of testers. Think about it, focus groups are easier to gather as distances are shorter and there are still enough people — and diversity — to make it count.

Alana Matos returned to Puerto Rico as part of Parallel18 Gen 2. She was doubtful that her venture would work, “I was scared because I work with universities and I thought that I wasn’t going to be able to do business with universities quickly enough.” However her outlook quickly change when she realized that the size and density of the island work in favor of being a test market. “When you really analyze the ecosystem in Puerto Rico, the market is so small and dense that you end up moving things faster than in the United States,” she previously explained.

Alana Matos, co-founder of Caila

Mobile Penetration

But, maybe you do not need any special equipment or complicated international zone laws and protocols. What your company provides is an app, a service, making free trade zone of no interest to you. According to Google’s research, Puerto Rico is a mobile first territory with 75% of its initial access through their phones.

Meanwhile, the SME Digital, Mobile and Behavioral Study of 2016 found that 86.2% of Puerto Ricans have a mobile phone. The Study also found that 69% of smartphone users in the Island use Android, while 24% are iOS users. Also, a number of carriers that are both present in the U.S. and Latin America provide services in Puerto Rico, an asset if your company is looking to enter either market.

Latino Culture

Despite its long standing relationship with the U.S., Puerto Rico still maintains at its core the Caribbean and Latino culture. Spanish is the primary language but English is also spoken here. In other words, to use the territory as a test market will allow your startup to find out in your language if your product or service is working with its target demographic.

It is important to remember, as David Ricks does in his book Blunders in International Business, that despite similarities, each market will need to be tweak to familiarize itself with the consumer. And, adapting your efforts, fine tuning the details to each market would be much easier once you’re already familiarized with a similar (if not exactly the same) culture, be it as a company trying to make it to the U.S. market or to Latin American.

With big changes in the horizon for the island, Puerto Rico is ready to receive new ideas that will facilitate the life of its population. Just like Google, when is your start up setting its sight in the tropics?

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