Looking for a new place to outsource Software Development?
Here are 8 reasons why you should consider Puerto Rico.

For the past 25 years, all types of companies have outsourced their Information Technology (IT) and Software Development teams either onshore, nearshore or offshore. There are pros and cons to all of them, and it’s essential to understand de ramifications of each before deciding the one that fits your company best. Let’s define the options first:

  • Onshore refers to outsourcing to a software development provider in your own country. For example, think that your company is located in New York and you manage IT needs in Arizona. You’re working in different states but in the same country.
  • Nearshore means that software development needs are handled in bordering countries or those that are a short distance away. For clients in the United States, this means nations like Mexico, Canada, and Puerto Rico.
  • Offshore indicates that the software development needs are managed overseas and in different time zones. Regularly, American companies hire services in Asia or Eastern Europe.


Probably the most common outsourcing method in the US has been offshore, mainly to countries like India (who hasn’t spoken to a John with an Indian accent). But when you’re a company in the United States, this model can become a headache. Apart from the cultural barrier, the extreme time zone difference, intellectual property issues, political instability, and physical distance can sometimes cause delays in projects. These delays eventually mean losing money.

That is when Puerto Rico comes in. A US territory since 1898, the island is under the same protections and Federal regulations as the mainland. It also shares the same currency, banking system, and financial controls. The Island offers countless benefits for companies looking to outsource:

1. A highly-qualified workforce:

Many Puerto Ricans chose American universities as their preferred choice for their higher education. Many of those who leave are specializing in engineering and software development. Also, the Island is the home of the Mayaguez Campus of the University of Puerto Rico, one of the top engineering schools in the US. In fact, Lockheed Marteen, Accenture, Boeing, GE, and Procter & Gamble, among others, come to job fairs in Mayagüez Campus and in the Polytechnic University of Puerto Rico to get resources. What does this all mean for American companies looking to outsource? That Puerto Rico has qualified engineers that can satisfy the needs of any customer. Developers in the Island follow software engineering best practices and US standards.

2. Lower costs:

Puerto Rico has a lower value of life than most tech hubs. That means that the hourly wage is lower than in the US. The average salary for an engineer in the US is around $100,000. Whereas in Puerto Rico that salary can be between $35,000 to $75,000. Outsourcing also means cutting costs like vacations, healthcare, and other expenses. That represents savings of up to 30% to 50%.

3. Location:

Puerto Rico’s geographical location is also perfect for nearshoring. The Island is only 3 to 4 hours away from most cities in the US, and getting to them costs less than $400. Also, PR has strong links with Latin America having to be under Spanish rule for more than 400 years. Traveling to Latin America is also cheaper from PR than from the US. For example, you can get to Colombia or Mexico for less than $400. That makes making business easier and less expensive, without sacrificing quality and security.

4. Culture:

Before 1898, Puerto Rico – like most of Latin America – was a Spanish colony. That means that the locals have very much in common with Latin American countries. However, in 1898 Puerto Rico became a US territory and most citizens are also fluent English speakers and are very synched to the American culture. That eliminates the cultural barrier that makes usually causes misunderstandings and delays when outsourcing.

5. Currency:

Forget getting lost in the exchange, Puerto Rico has the same currency and banking systems as the mainland.

6. Protections under Federal law: 

As a US territory, Federal statutes and protections cover everything produced on the Island, so your IP is protected by Federal copyright and Patent laws. According to the 2013 UPS Change in the (Supply) Chain Survey, 55% of high tech companies cited “Improving control over quality and intellectual property” as their primary driver to nearshore.

7. Attractive tax incentives:

The tax incentives that have more impact on software development companies are Act 20 and Act 73. Both offer fantastic tax benefits, exemptions, and tax rates that help us make development prices in Puerto Rico more competitive. 

There are also ways where you can benefit from these vehicles without moving to Puerto Rico, Contact Us if you are interested in learning more.

8. Certifications:

INVID holds a Small Business Administration – SBA 8(a) certification from the Federal Government and National Minority Supplier Development Council certification among other technical certifications that come from the Federal Government. So this only means more benefits for you and your company.

Developing software in Puerto Rico is a safe, smart, and secure choice. Ready to make Puerto Rico your software development hub? Contact us!