Do you have an internationalization project and are considering opening a company in Spain? You’re not alone! Many English entrepreneurs see Spain as a dynamic and promising market for exporting their company’s value proposition. But how can you succeed in this venture? This guide will reveal the essential steps and tips to open a company in Spain. Read to the end to discover how to avoid common mistakes and maximize your chances of success...
Why open a company in Spain to grow your business?
A Dynamic and Growing Market
Spain offers an attractive market with a diversified economy. Sectors such as tourism, agribusiness, and information technology are particularly vibrant. Moreover, its strategic position in Europe, along with its history and language, makes it an ideal gateway to Latin America. By entering Spain, you are potentially addressing a much larger market.
Tax Incentives and Business Support
The Spanish government provides various tax incentives to encourage the establishment of new businesses. Additionally, numerous forms of support are available, particularly for SMEs and startups. For example, you could benefit from the well-known Kit Digital program when you establish a branch in the country. Through this initiative, your clients could receive subsidies to purchase your solution… a compelling advantage!
A Rich and Welcoming Business Culture
Spanish business culture values innovation and teamwork. Spaniards are known for their warm hospitality and collaborative spirit, which makes it easier for new businesses to integrate.
The digital ecosystems in Barcelona, Madrid, Valencia, and Málaga are particularly lively. Numerous events provide opportunities to connect with other country managers or founders and gain valuable insights into the market.
Key Steps to open a company in Spain
Choosing the Legal Structure of Your Business
Choosing the legal structure is crucial to opening a company in Spain. The most common options are:
- Limited Liability Company (SL): ideal for small and medium-sized enterprises (SMEs).
- Public Limited Company (SA): recommended for large businesses.
In any case, it is important to study all the legal structures the market offers and, if necessary, get assistance from a local partner who can guide you in making the right choice.
Obtaining the NIE (Foreigner Identification Number)
The NIE is essential for any administrative procedure in Spain. You must obtain it from the national police or the Spanish consulate in your country. No, this does not make you a resident of Spain, but it allows you to carry out all the necessary procedures related to your business in the country.
You will likelyIf you’re not in Spain, you can simplify the process by delegating powers to a local representative (sales director, country manager, law firm…) but it is likely that you will need to travel at certain times to formalize the procedures.
Registering Your Company
To register your company, you must:
- Reserve Your Company Name: Check the availability of the name with the Central Mercantile Registry (RMC).
- Draft the Articles of Association: Define the operational rules and responsibilities of the directors.
- Deposit the Share Capital: Open a bank account in Spain and deposit the minimum required share capital.
- Notarize the Articles: Have the articles certified by a Spanish notary.
- Register with the Mercantile Registry: Register your company with the RMC.
Obtain the NIF (Tax Identification Number)
The NIF is required for tax transactions. It is issued by the Agencia Tributaria (Spanish Tax Agency).
Register with Social Security
Register your company and employees with the spanish Social Security to benefit from social coverage.
Obtain Necessary Licenses and Permits
Depending on your business activity, you may need specific licenses. Inquire at the local town hall or with local authorities.
All the previously described steps should not be improvised, and it is essential to follow them carefully. Don’t hesitate to seek the help of a local partner like N3xtwave to assist you.
Challenges to Anticipate in Spain
Understanding the Spanish Business Culture
The Spanish business culture may differ from what you’re used to, and the country’s culture can surprise foreign salespeople venturing beyond the Pyrenees. Spaniards place great importance on relational intelligence. If you adopt a too-formal English approach, you risk offending your interlocutor, who won’t hesitate to point it out. On the other hand, if you are too relaxed, you may give the impression that you don’t take your counterparts seriously. Meetings can seem more informal, and decision-making might take more time, but don’t be fooled, your interlocutors are just as demanding, if not more so, than those in your home market.
Mastering the Language
English is very popular among the general population, especially in areas such as tourism and large companies. However, if your target market focuses on local businesses or private clients, mastering native Spanish will always be an essential option to ensure success.
It should also be noted that Spanish is spoken in Latin America as well. However, the linguistic differences are well-perceived by the local population. That’s why it’s preferable to hire native staff or people who have been established in the country for a long time. Especially if you need a professional sales team.
Adapt Your Marketing Strategy
To succeed in Spain, it is essential to understand the preferences and behaviors of Spanish consumers. Adapting your local marketing strategy can make the difference between success and failure. You can rely on a local partner who offers marketing and sales consulting services, such as N3xtWave.
The Benefits of a Spanish Brand
Local Recognition and Trust
Creating a Spanish brand allows you to benefit from recognition and trust from potential customers in the country. This can be a significant asset for growing your business. Adapting your brand name if it is difficult to pronounce in Spanish could also be a good idea.
Access to a Network of Businesses and Institutions.
As a Spanish company, you will have access to an extensive network of business partners and institutions, facilitating your growth and expansion.
Partnership Opportunities
Spain offers numerous partnership opportunities with local businesses, which can strengthen your market position.
Legal and Regulatory Aspects to Know to open a company in Spain
Spanish Law
Understanding the legal and regulatory aspects of Spain is essential to ensure your business is compliant. The Spanish Constitution guarantees business freedom while imposing strict rules to protect the rights of workers and consumers.
Personal Data Protection
As a member of the European Union, Spain adheres to the General Data Protection Regulation (GDPR). Any business operating in Spain must comply with these strict rules regarding the collection, processing, and storage of personal data. Make sure your company has clear privacy policies and robust security measures in place to protect customer data.
Labor Law in Spain
Labor law in Spain offers strong protection for employees. Companies must comply with regulations on wages, working conditions, vacations, and workplace safety. Many of these laws differ significantly from English laws, so it is crucial to seek professional advice on this matter.
For example, unlike the English market, the workweek in Spain is 40 hours, and this applies to all types of employees.
Accounting and Tax Obligations
Businesses in Spain must maintain rigorous accounting and submit regular tax returns. Tax obligations include VAT (IVA in Spain), corporate tax, and social security contributions, among others. It is recommended to hire a local accountant or tax advisor to ensure your business complies with all tax obligations.
The Spanish Banking System
Opening a Business Bank Account
Opening a business bank account in Spain is a crucial step for the financial management of your company. Spanish banks offer various services tailored to the needs of businesses, such as current accounts, credit services, and cash management tools.
Payment Methods
Common payment methods in Spain include bank transfers, credit cards and direct debits.
Recently, a new payment system called Bizum has become very popular. Initially used for personal transactions, Bizum is now offered as a payment method by many businesses. Depending on your target audience, it may be worth considering its implementation.
It is essential to choose payment solutions that suit your business and your customers’ preferences.
Obtaining Financing
Spain’s government offers numerous financing options if you open a company in Spain including bank loans, government grants and venture capital. Spanish banks and financial institutions offer a variety of financial products to support the growth and development of businesses
Human Resources Management
Recruitment and Selection
The recruitment process in Spain can be complex due to legal requirements and cultural expectations. Asking a local partner, such as N3xtWave, for help and advice on recruiting staff can be very useful. It is also important to understand the qualifications and certifications recognized in Spain to effectively assess candidates.
Training and Development
Investing in employee training and development is essential to ensuring your business’s competitiveness. Spain offers many professional training options, and it is often possible to benefit from subsidies for ongoing employee training.
Marketing and Promotion in Spain
Studying the Spanish Market
Before launching your business, it is crucial to conduct in-depth market research. This includes analyzing competitors, understanding consumer needs, and assessing market trends. Market reports and sector analyses can provide valuable insights for developing your strategy.
Adapting Your Communication
Communication is a key aspect of succeeding if you would like to open a company in Spain. It is important to adapt your marketing messages to be natural for the local audience. This goes beyond simply translating from english to spanish. It involves adjusting language, content, and the way of expressing yourself to fit the local specifics of Spain. It is also essential to identify the most appropriate and popular communication channels in Spain to reach your target audience.
Developing a Brand Strategy
Building a brand in Spain requires a well-thought-out internationalization strategy. You may need to make adjustments to your messaging or emphasize other aspects of your brand that have a strong impact on the Spanish audience. For example, in Spain, there is a very high sensitivity towards issues related to gender equality and mental health in the workplace. Support for the sports world through sponsorships and sponsorships of local football, basketball, volleyball, etc., teams also have a significant impact on organizations.
Partnerships and Networks in Spain
Joining Professional Associations
Professional associations and Spanish chambers of commerce offer many networking and collaboration opportunities. By joining these organizations, you can access valuable resources, participate in sector events, and establish contacts with other local businesses.
Collaborating with Universities and Research Centers
Spain has a strong network of universities and research centers that can be valuable partners for your business. Universities can help give visibility to your brand among professionals and businesses in the sector. Additionally, working closely with educational institutions will allow you to offer internships at your company, allowing university students to gain experience in exchange for their work time within your organization. Collaborating with these institutions can help you obtain valuable resources and grow faster.
Establishing Local Partnerships
Forming alliances with local businesses can facilitate your integration into the Spanish market. Local partners, like N3xtWave, help you navigate regulations, understand consumer preferences, and access existing distribution networks.
Technologies and Innovation in Spain
Spain is an important hub for technology and innovation, with growing sectors such as information technology, renewable energy and biotechnology.
Currently, Spain has four technology development hubs that are increasingly standing out in Europe: Barcelona, Madrid, Valencia and Malaga. Especially when it comes to digital nomads, Spain is one of their favorite destinations.
If your business operates in these sectors, you will benefit from a dynamic ecosystem and many collaboration opportunities if you decide to open a company in Spain.
Expansion and Long-Term Growth
Growth Strategies
To ensure the long-term growth of your business in Spain, it is important to develop solid growth strategies. This may include geographical expansion, product or service diversification, and continuous innovation. Strategic planning and regular performance evaluation are essential for adjusting your growth plans according to market developments.
Managing Risks
As with any market, there are risks associated with operating a business in Spain. This may include economic fluctuations, regulatory changes, and operational risks.
From our experience at N3xtWave, one of the major mistakes many foreing companies make is underestimating the impact and importance of Spanish government administrations on the entire market when you would like to open a company.
The administrative organization of Spain is complex, more complex than other countries around the globe, and it is essential to fully understand it to avoid failure when exporting a business model. Different public organizations intervene in the market, and it is crucial to know and take them into account to operate efficiently. These are:
- The government of Spain
- The governments of the different autonomous communities or regional governments
- The local town halls of each locality
Using Data to Make Decisions
Data analysis is a powerful tool for making informed decisions and optimizing your business performance. Use data analysis tools to monitor key performance indicators, identify market trends, and assess the effectiveness of your strategies. Data can provide valuable insights to adjust your operations and maximize success.
5 examples of successful SaaS companies in Spain
- Alan: Alan entered the Spanish market by challenging the status quo of traditional health insurance with a transparent and digital proposition. Its implementation process was characterized by special attention to the specific needs of the Spanish market, offering personalized coverage and a hassle-free user experience, which allowed it to capture the attention of both freelancers and companies alike.
- Steeple: An internal communication software that has established itself as a reference in the Spanish market thanks to the localization of its interface and content. Steeple set up a local team in Barcelona, from where it developed a marketing and sales strategy tailored to the market’s needs, thus strengthening its brand among its target audience in the country.
- Aircall: Aircall entered Spain with a strategy focused on offering flexible and efficient business communication solutions through its cloud-based phone system. Its implementation process stood out for the customization of its services to meet the specific needs of Spanish companies, including integrations with local tools and multilingual customer service.
- PayFit: It has revolutionized payroll and human resources management in Spain with its intuitive and automated approach. Its implementation process was characterized by close collaboration with local experts in labor and tax legislation, thus ensuring regulatory compliance and offering a service tailored to the particularities of the Spanish market, which allowed it to quickly gain the trust of companies of all sizes.
- ConnexAI : is the UK’s largest customer service AI SaaS company, marketing an omni-channel platform that includes several modules for business and customer relationship automation across social media, calling and messaging applications.
Conclusion: The Entrepreneurial Adventure in Spain
Starting a business in Spain is an exciting but demanding adventure. By following the steps and considering the specifics of Spanish business culture, you will maximize your chances of success. Remember that the key to success lies in preparation and understanding the local market.
Ready to get started? N3xtWave is here to guide you through every step of your project. Contact us for personalized support and turn your vision into reality.
What services does N3xtWave offer to help my company launch in the Spanish market? At N3xtWave, we have a skilled team based in Barcelona, Spain, that can promote your product to potential customers in this market. We have specialized staff in marketing, sales, customer service, etc. We have experience working with English companies in both markets, which gives us a clear understanding of how to reach potential clients, manage the different stages of the buying process, and ultimately grow your business in Spain.
Why should I opt for N3xtWave’s services instead of launching the product ourselves? Our value proposition is clear: we save you time and money. Expanding into a new market involves learning, bureaucracy, and hiring, all of which are time-consuming and costly. Many companies address this by hiring an internal expert to design internationalization strategies—someone experienced with launching startups or entering markets like the UK. However, this approach comes with significant risks, costs, and a steep learning curve. From hiring staff to navigating contracts, registrations, and office setups, the process can be overwhelming.
What if you could simplify things with an experienced team for a fixed monthly fee? That’s where N3xtWave comes in. We streamline the process by outsourcing it entirely, taking on the initial challenges and delivering measurable results. Once we’ve laid the groundwork, we assist with business development and help you build your local team.
By partnering with us, you avoid unnecessary expenses, reduce risks, and achieve faster market entry.
What is N3xtWave’s working process for launching my software in Spain? You can find all the steps of the process in our section dedicated to the internationalization of SaaS companies. In summary, our service starts with adapting your company’s marketing strategy for the market. To do this, we carry out contextualization of the most relevant content to achieve the first conversions. Then, we define the sales process, taking into account the number of people who need to be involved in the process: SDR, BDR, Account Executive, Customer Success Manager, etc. The tracking of results is carried out regularly, week after week. You and your team always have control over what happens with your product in the Spanish market.
How long does N3xtWave typically take to achieve the first results in Spain The time required to achieve results is highly variable. It depends on multiple factors that are not solely related to the sales process. In general, tangible results start to emerge on average after 6 months. This is when the product is typically fully adapted to the market, and one can begin to draw initial conclusions. It is also important to consider the support from the product department to adapt the software to the country, which is essential for the success of the project. We handle the identification of pain points, growth vectors, and the marketing and sales strategy
