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Starting a Business in Spain: An Underground Conversation with Fernando Pujalt (Part 2)

By: Thoughts of a Random Citizen Podcast

This is the second part of my conversation with Fernando Pujalt. Today's conversation talks about the entrepreneurial environment here in Spain, Spanish culture, and how it relates to their political environment, beach life; Spanish and European taxes; societal protection, and bullies.

Moving on to the thing that I'm most interested in: the entrepreneurial environment here in Spain. I know you traveled back to the US quite often, you have contacts, and you worked there and lived there for a long time, so what made you want to start and launch your product here in Catalonia?

Mostly selfish reasons. I love this place. When my wife and I came here in 2011, we fell in love with the town. We bought an apartment in 2013; a small place, quite cozy, and we used to come here all the time. It became our happy place. In 2018, I told my wife why don't we just leave the US? Twenty-five years later. All because, look at the typical American family, they've got a mortgage, two kids, two cars, a 401k, they're paying into social security. They have good credit, so it's easy for them, at least some of them, but talking about the guys, people have made it. One's a doctor; the other is a business owner, a director, or a vice-president in a company.

Still, you look around, and there are no assets, the kids are in the house watching TV all day long, and my wife and I have to go through trenches to be able to be in a place where we enjoy each other. It's a struggle; why is it so hard? We always have to worry about so many things; logistics is a nightmare.

In the US? Comparatively?

Yeah. You need a car to go everywhere.

Oh! I was thinking logistics in regards to delivery services.

No, don't get me wrong. You've got logistics. Do you want people to take shit to your house? Amazon has on the same day deliveries, you go to a bank, and you feel like a god; it's so easy because America loves money. Anything that has to do about making money, saving money, you have a credit card that gives you 3% on every time you go and spend, then, of course, pay very high interest if you don't pay it on time. Then there was a moment when I thought maybe my wife and I wouldn't have come here if we didn't have kids, but I wanted my kids to walk free on the street without me worrying.

Still, we wanted to change our lifestyle, and it was a very personal decision, not an entrepreneurial decision. The Spanish government is the opposite of the United States. They want all your money; you come here, you're going to pay for the bank, you're going to pay fees up to your asshole because they don't trust the people, which is very different from the United States.

So, it just comes down to the mindset of the governments. Where is that lack of trust? Why is that lack of trust already there?

two people sunbathing, beach, blue sky, horizon

I think there's a historical factor here in Spain of extreme fear from when it was a dictatorial state to the aftermath when that dictatorial state stopped. People got rid of that fear, and you can't really send soldiers to people's houses. I think it's not just a systemic problem in Spain; it is in Portugal, Italy, Greece. People that live near the beach and have a lot of sun tend to be a little laxer, and there is this sense of people looking for shortcuts. I think the government just assumes that everyone is going to take a shortcut.

How do you fix that? How do you get the general populace to think it'd be better for everyone to stop taking shortcuts together?

That's a very American thing, and you're absolutely right, but everybody will say yes, and then 50% will do the opposite, and the other 50% won't do it either after they realize that the initial 50% didn't do it. It's a cultural issue. Spain would need to find ways of generating income that doesn't come from the general population.

In other words, the people who pay the most taxes in Spain are not the big corporations; it's the autonomous, the self-employed that open their own businesses and carry the country's weight on their back. You could be working 40, 50, 60 hours and coming home with €1,400 a month, and rent is €900. So I think that Spain will have to change because it's not a sustainable system; it will eat up their economy.

I thought that changing towards credit cards would have more income represented, and Spain would get more taxes from its purchases, but they did the opposite. They raised the charge for the autonomous. It's about politicians taking care of politicians. It's not about the people, which repeats around the world; it's not specific in Spain. You find it a lot in Southern Europe.

Still, how do you work around it? Don't do things without understanding what you're doing. Number one, get a good accountant, a lawyer. Number two, understand your immigration status. If you become a resident, you have to pay for everything you have. So the first thing is to understand what rules you're playing with. Secondly, I recommend every single person to follow the Mitt Romney strategy.

What is Mitt Romney's strategy?

"Corporations are people, my friend." So if you're an American and you want to come to Spain, you must not exist. You must become a corporation. Do not charge anybody for any service. It's your name, LLC, that charges people for things because Spain will ask for your personal wealth.

So you're saying that if you come to Spain, have a corporation outside of Spain in charge.


I'm over here right now, and I'm an American, and I'm going through a partner visa to get citizenship here. I wanted to open up a business here, but that's the last thing I want to do now because it's 40% across the board, making it nearly impossible to run a business unless you want a hemorrhage of money. Considering in the US it takes two to five years to even turn a profit, even when they're not taxing you 40%, and you have all the tax system on your side. Can we highlight why Spain is actively doing this to itself?

It's a great question. I think there are multiple factors: one is just plain laziness, and changing the laws is complicated. The other thing is, do you think they would let Americans come over here and, for example, open a bar and pay no taxes, whereas the locals have been struggling with it for decades? No! They've been screwing the Spanish people for a long time.

Still, I guess the Spanish populace isn't as actively involved, are they? This comes from an outsider's opinion on politics.

I think it is very social. You're going to find that Spaniards are very involved in politics regarding social issues, protesting about women's equality, gay rights, fascism, or protesting... fill the blank of social issue. Now, when it comes to corporate decisions by the government, they're not. If I were an autonomous here, I'd be protesting. What they're doing to the self-employed is self-destructive.

Well, rights are one thing, because you can obviously give rights to everyone, that costs no money, but social programs, are paid for by a good entrepreneurial class, no?

A lot of them are paid by the autonomous, and big companies, like Zara or Repsol, have agreements with the government. They pay less. The United States does charge taxes, but not to small businesses. They say, "I'm not going to charge you taxes. Play your game. I'm gonna let you grow. I know out of a hundred, two are gonna make it, but the two that are gonna make it are going to make it big, and we're going to make money of those big businesses."

Exactly. They're employing a bunch of people, paying for a bunch of things, and they're still paying taxes.

They're paying taxes, they're paying social security, they're going out there, they're feeding the circle, and you trust them. IRS says, "it's all right, just don't fuck with me. I'm going to be cool with you, but you're going to jail if you're not cool with me." Not a lot of people are in jail in Spain for not paying taxes. They say they're going to go to jail. The judge says they're going to go to jail, but nobody goes to jail. In the United States, you don't pay taxes, and your ass is in jail. So I do think they're very different systems. The system in the United States is, "we know you're going to pay taxes because you're not stupid," in Spain is, "we know you will not pay taxes because you're not stupid." So, it's the opposite.

Now, if you like living here, you have to find a way to simplify. Don't over-complicate. If you're going to open a business here in Spain, it needs to be a business to generate sustainability, but your growth needs to come from somewhere else. Let the company in the United States make the money, and the company in Spain sustain the life, and once in a while, the business in the United States lends money to the business in Spain.

I guess that circles back to your sustainability with your sushi business and your multitarian entrepreneurship. What's it called?

We're still developing it, but it's going to be called CanVida. slogan and logo, vegetables, spices, fruits, plates, cutting boards and knives over a table

So, why do you think that the launch can be held here? Is it just because of the love for the culture?

Initially, I'm here, and I'm going to be the number one customer. Do you know how hard it is to cook a multitarian meal? I'm talking about maybe 25 to 30 different vegetables, fruits, and seeds. It's a pain in the ass, and I do it every day. I spend about an hour prepping food, and I would love for a company just to sell it to me. Every time I tell somebody about being a multitarian, they're in, but I'm losing them as I'm explaining what they have to do. They start saying, "So, I have to cut the broccoli? Seeds also? What? Which seed? All of them? Do I have to buy all of the seeds? I only know one seed. I'll have to look that online." It's a lot of mixed vegetables; it's all good for you. It's things that people can trust, not health gurus blabber about kale, or açai, or lombarda.

Well, at the same time, this is a really good place to have it because the Latin-European culture isn't much into microwave meals. Obviously, that's not what you're about, but sometimes when I cook, I just want to put something in the microwave and be done.

The microwave is not a bad thing, don't get me wrong; the problem is that the food that you're buying tends to be 80% flour. It tends to be most probably something with pasta or hot pockets. You could go with other types; you could go with buckwheat or lentils. There are so many good-quality kinds of pasta out there today. The problem is the flour's the product that they're using to make the pasta, and flour has never been a very highly nutritious product since its beginning, since its inception. It helps from starvation, that's about it.

You're very familiar with history. Before WWI or WWII, I'm not exactly sure; there was a big talk about how the population would starve, and there was a food crisis. The scientific community realized that we needed to start developing food and different ways to produce for the population. Obviously, the population from WWI is vastly larger now.

How much of that has carried over into why we produce foods in the way we do now? Do you think it's sustainable? Do you think we can go back to a time or a place which allows eating proper foods?

It was something that happened after WWI. We had a soil problem in the United States and around the world; we were destroying fertile land because of farming. This was being plotted incorrectly. It was the same product, but new equipment was introduced, and it would just hit the layer; it wasn't breaking the ground, it wasn't breathing the land, the soil. So, the land started becoming arid, and there was a huge program in the United States to change all that. Ideas like how do we make wheat stronger? How do we make soybean stronger? How do we make things go better so pests don't eat them?

So yes, there was this famine fear around the world. In the 20s, 30s, 40s, millions of people were dying of famine. Today not so much. Today more people are dying of heart attacks. Obesity right now is most probably the biggest human threat in the world. The problem is that they saw the need for new ways and changed wheat's genetics. Today, the wheat that we grow has changed; the wheat we grew in the 50s is not the wheat we grow today. It grows a lot faster; it grows everywhere. It's biologically changed, and it's bad because there's no more wild wheat anymore. I know that most of the wheat we eat today is genetically modified from the past.

We changed to be able to grow everywhere, and that was the idea in the past to solve the population crisis, and people wanted to keep growing to feed the world. The preoccupation wasn't: how do we stop growing? This is not by creating a disease in a lab that will kill 90%, 80% of the population. It doesn't work that way. How do you stop a world population? That's the problem; the world was going to have too many people. One factor stopped population growth: women's education. The more women are educated, the more they decide not to have babies; they want to have careers. If you look at the literacy rate of women in the 1950s and the literacy rate today, you're talking about a 40, 50, 60% factor difference.

Crowd of people in a city centre, buildings, signs, stores

Yet the population is growing exponentially.

Still, it's curving. Even China's population is already declining. Japan's and Russia's have been declining for years. Who told the communists to teach their women how to read? I say that facetiously; I'm saying that the higher education women have in third-world countries, the lower the population you're going to have. I do believe that there's going to be a curve down. I don't know how fast it's going to be, but based on some research that I've seen, we're going to peak out in the in 2050, maybe to 10 billion people, but then it will start coming down.

Spain will have a negative population, Italy, Sweden, Norway, Finland, and the United States. If it wasn't for immigration, the United States would have lower levels of population. People have to understand that they want a better quality of life. So the spans per capital are actually going to increase. That's good news. We're going to have fewer people, but each person is going to consume more, is going to spend more money. It will be a more productive population. I'm an optimist.

Radu, our amazing bartender in GinTub right now, just mentioned that Elon Musk actually said the opposite: "people should be having more babies."

Yes. Musk is afraid that the world population is going to decline too fast, that it's going to peak down. He understands that because people are not having any children. Elon Musk should be having more babies. He can pay for them. He could have 8,000 kids, and they'll be fine. So, instead of telling people to have more children, he should just go to Iraq, Palestine, Ukraine, Somalia, and just adopt a bunch of little children and set them out to space.

It's funny though; we say this is the worst time in the world. When it's not a bad time to live, we have energy, air-con, and amazing things, but maybe if we are patient, educated, and communicate with one another, everything will be alright. What do you think about that?

We live in the best of times, but our minds are in the worst of times. We've got two universes, the real universe, and the meta-universe, the last one being: everybody feeling anxious, everybody feeling stressed.

It comes down to the fact that's how it has been designed because it's not been designed around your pleasure. It's been designed to explore you and sell you to the highest bidder; it's been created specifically and purposefully to go into your mind, figure out your weaknesses and then use them to create thoughts.

For example, these horrible situations happening in Ukraine. People want to connect the issue they're fighting for with Ukraine. You can see people from the right saying, "They took the government from Russia, it used to have a government, and then they started a government, and it's a regime that wasn't supposed to be there." On the other side, people from the left are saying, "it's about transgender rights and gay rights." I always say, "no, it's not about you." People today are just generating anxiety because we're so connected. It's a beautiful thing to be connected, but it's exhausting. If anybody now doesn't feel exhausted about what's happening in Ukraine, and they're not physically or psychologically affected, good for them because most of us are.

I wake up in the morning, and I don't watch American news; I watch German news. They tend to be pretty straightforward, ever since 1945. They put it out there, and they give you different perspectives. They have a German-English channel, and it is the best news channel because they're connected with the people. It's not some guy making €12 million a year, it's a guy making maybe €65,000 a year after taxes, but there is genuineness behind a lot of the news.

Anyways, there is this anxiety that there's going to be a crisis, something's going to happen around the world, people are gonna freak out. Also, we are trying to overprotect society from the bad. The other day, somebody told me they wished schools prohibited bullies. What? Well, as a child, I was bullied.

I was bullied; I was a bully, depending on the day.