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- [00:01]
A
Hey, welcome back to Real Estate Without Borders. Today I'm joined by Alessandro Palombo. I hope I pronounced that correctly. That runs bitizenship, I think, and doing some, some research and letters and global citizenship around, not so much focused on real estate, which is one of the primary ways that we see people wanting to move their capital into new countries. But I really wanted to explore with you another way that we're seeing people move capital into new countries and migrate into new countries, which is kind of through crypto and especially Bitcoin. And you know, your, your X page says that you simply one of the things that you do is simplify borderless living. So you can tell me a little bit about yourself, about the businesses that you are running and how you help people to do that 100%.
- [00:52]
B
So Daniel, very glad to be here. First of all and foremost I'm recording here from Lisbon and so I'm Italian, I was born and ran in Rome. My current businesses are I'm the founder of Businesship and we have created the bitcoin ecosystem called Envisa Farm. So we, we help Americans, Indians and many nationals to acquire a pathway to the European citizenship by investing in our fund. In our fund invest in local company which acquires exposure to bitcoin. So this was the first actual attempt and the first regulator entered in Europe with this model that we went viral. And this initiat growing very fast is a family business. I'm also the founder of a startup in the global living or mobility space. It's a platform for imagine like a subscription and you can relocate and get tax and admin assistance for now in three countries. But we are scaling it very, very fast. We have some investors behind and we have also some more, I would say original plans behind maybe because of my background. So originally I qualified very young as a lawyer. There is no proof because I can't obtain it, but arguably probably the youngest In Italy in 2013 I did all the academic career. I got a PhD in public law. It was my true passion. I did master in Global regulation of markets and then my kind of short story is I understood a legal marketing Delhi was a bit restrictive and I started founding startups and I haven't stopped. And thanks God I got the opportunity to work with amazing people, especially from the US And I'm still learning a lot. So this is me on X and in the last year I tried to give my best actually for growing on this platform and this has revealed to be one of the greatest learning and tools for me. So yeah, happy to to to chat more about, you know, any of these topics. I I'm almost daily studying, researching, talking with people clients in so many countries.
- [02:41]
A
Awesome. Yeah, I I've been really intrigued. Like I've been a follower of yours on X for a while now and we had your friend Tim on the show and you guys share a lot of stuff back and forth and one of the posts, the post that you have pinned on your X page right now, I'm going to read it for our audience because this is actually I shared this with my co host Dave and I said we have to get this guy on the show and so it says the wealthy don't protest, they exit,800 millionaires left the UK in 2024157 surge from 2023. But if you're leaving and want to match London's infrastructure and have a European lifestyle, where do you go? Here's my realistic list of alternatives in 2025. Can you tell me a little bit about the first line in that tweet? Because I think it says a lot from my perspective.
- [03:26]
B
Thanks a lot for asking me these so you know, I think that we always, you know, when there is a conflict or when you dis. When we dislike eventually the status quo in our country or when we dislike government, the first immediate I would say reaction usually is protesting is. Is to express eventually our defiance or disagreement. Right. And in reality when we zoom out Daniel, what we have seen in the history and actually in the recent modern history is that in the end those ones protesting are never the. The. The real wealthy. Right. And why? Because wealth in general has always options. I would say that the level of wealth and the level of optionality are directly correlated and from a broader perspective. But that's again there are so many thesis probably in this single line. And I recall this is one of my favorite line actually I posted in a previous post and someone commented oh damn, this is a fantastic line and got so many likes and I said okay, I need to reuse it in a thread. In my view it makes actually something that sometimes the best lines are things that everyone already knows but probably they're not rationalizing them. So wealth is mobile by definition. Like for example that Norwegian billionaire who was based in the UK now is moving to the uae. In general wealth is always moving as you know, some famous guy guys always say where it's treated the best. So I think that exiting from systems is and is going to be an emerging trend because exiting compared to 20 years ago before digital economies and when borders had I would say important relevant today exiting is possible and an opportunity also for the non so wealthy.
- [05:12]
A
Yeah. And so tell me a little bit about like you're helping people do this, like what are you observing in the people who are reaching out to you? Like what is their, why are they leaving the places that they live? Where do they live for the most part? Like where are you getting the most applicants or customers from? And what seems to be the really the primary factor that's driving them? Like is it politics? Is it the fact that they don't feel that their wealth or capital is being respected? Like tell me a little bit about what's going on there.
- [05:40]
B
So that's a great question actually. So if we focus on our fund at least so we are talking essentially of people gaining a Plan B. So they are not yet moving eventually in Portugal, they're not yet moving in Europe, but they want to acquire a Plan B. So a pathway. They need to come here 14 days every two years and after five years they can apply for a Portuguese passport. Okay. Which means European passport. So in this case we help people acquiring a Plan B. On the other company, we help people relocating in Portugal, in Thailand and in the UAE for now and Spain very soon. So what I can tell you is for those ones seeking a Plan B, it's stability in general. People want more freedom and more stability, I would say for them, their families in the next 10, 20 years. For example, we have, we have a few actually Canadian clients, I won't disclose the professions, et cetera. But they are successful entrepreneurs, let's say, or professionals in general. And they, they feel probably constricted in a system that they say that it doesn't represent them anymore them very well politically. So my thesis, Daniel, is that it's never a matter of only economic benefits. I think that every article, every even TikTok or X post that you read about, you can save 20 points percentage. You should do X, Y, Z. In my view that's never the real reason. The reason of frustration in my view comes from probably a lost sense of identity. Plus yes, I want to get more freedom, I want to get more stability and the sense of, especially from Canadians, things are constantly changing from Americans is very often 8 towards the current government. Right. Because in the end the USA specifically. But I would argue most of the countries are running now on a dual party system. Rights either is one or is the other one. And if that administration is in place and you don't dislike it, you want the Plan B. So with Trump, of course we have Seen a in Portugal expressionism program skyrocketed. So for Americans I would say it's eight for the current system and more or less this is the same buy but it changes. I could go Indians. It's a different story. Why? Indians have objectively one of the worst passports on earth. And I have many friends who are Indians. Actually one of my best friends is Indian Italian and in that their case they really need a second passport for relocation. It's a different story. And in, in general every story is unique. But I, I let you, I let you ask me something some more specific. Otherwise this topic can take very long.
- [08:09]
A
Well, I mean to be honest with you, I mean that's what I want to talk about. So by all means take, take as long as you want. I mean, I mean what's so, so then on the flip side, like we talked about the push factor, so why people are thinking about leaving. But there's, you know, that's, that's maybe the stick. What's the carrot? Why are people looking at places specifically as a place to go and diversify their, their visas or their, their citizenships? Like what makes it a compelling place to go?
- [08:33]
B
100%. So looking at citizenship from a, from a perspective of pure citizenship, Europe is in my view it's a closing window. Why Malta has been essentially deleted in April. Even the Spanish golden visa has been terminated, Cyprus terminated and so far and so on. So the only lawful standing option is Portugal and Europe in general. Daniel makes a lot of sense. Why? Because you get 20 exposure to 27 different countries and you can, you have right of settlement so you can settle there with your family in the next five, 10, 20 years. And in a world which is constantly changing, Europe is generally seen as a stable play. So wherever you're coming from, honestly, this is, I didn't create this fund, so I created this fund because of this. This is not the other way around. So my, my take is Europe. With all the challenges it has, it's always a stability play. And this is in my view particularly true in the AI age. I made a post not long time ago that received a lot of consensus and of course a lot of criticism where I express my honest opinion. Where Europe needs to wake up and needs to build. We can't be always slowed down by crazy regulations. With that said, Europe in my view is not going to be Europe poor once we figure it out. The immigration problem, the bad migration problem, I would say the legal, lawful and talent based migration, I would say challenge. Why do we do that? In my View in the ih, Europe is going to be rich. Why? Because we have certain assets which in a machine driven economy can't be replicated. So you can't replicate Florence, you can't replicate the torefel and culture, food, art and so far and so on. So in my view in the I age when everything in 20 years will be capable of being replicated, easy Europe will appreciate in value. So this is the reason from a citizenship perspective, from a residency perspective, maybe I'm saying something obvious for some, but Portugal is one of the, I would say most underrated tax optimization place in the world. Why? Because when you think of tax optimizations, I lived in Dubai for almost five years. I lived in many countries. Well, you imagine always as a tax haven, okay, Dubai, Dubai is the first choice. You can get the golden visa, you can get a regular visa. We assist people looking to Dubai, we know a lot of professionals there. But the reality is that with proper structure even now Portugal can give you 0% foreign tax income. So this is the new NHR called EFISHI. You need a local employment agreement. There are some conditions, maybe you need to have your local company serving your foreign company. So it's not straightforward, but for 10 years you get a stable guarantee of tax optimization. So Portugal means lifestyle, lower cost of living, exceptional healthcare and potentially a tax optimized play. Within Europe. The climate is great, it's a sort of California. So that's why many in tech, especially from Web3Crypto, Bitcoin in general are located here. 365 days plus per year of holding. Crypto is taxation zero. So you don't pay taxes on cryptocurrency gains. This is great. And the political outlook in my view will keep keeping the doors open. On the other hand, Portugal is highly bureaucratic. So the real challenge, Daniel, is for Portugal right now. Operating businesses inside Portugal is tremendously complex. So usually, and this is how the government in my view, in a very mindful way put together a plan developed in phases. So phase one is you come here, you keep your business abroad, you don't pay taxes on that one. And we start creating eventual talent based in this country which is not that big. In the end it's 10 million people and it's a cultural neutral country. So that's what people typically also Canadian like you appreciate. I have actually here two or three Canadian friends and you can speak English here with, with almost everyone.
- [12:14]
A
Really.
- [12:15]
B
Yeah, yeah, I have two people from. One from Toronto, one from Winnipeg. Yeah, yeah. So actually yeah, we, we hang out Often together they're founders or people. Yeah, they wouldn't be able to visit Rome. Have you, have you visited recently, Rome?
- [12:33]
A
No, I have not. I haven't been there in four or five years.
- [12:37]
B
Well, I don't know if you remember, but I think you struggled in talking, you know, speaking English with, with locals, right?
- [12:42]
A
Yeah, 100%.
- [12:44]
B
We don't learn English really that much. So Portugal is different. So this is the Portuguese play. So if you zoom out, Portugal in Europe, great option. Malta, tax optimized. But it's a different play, it's very small. Spain, there is the Beckham law. So technically there is a tax optimized play. But some people I know have had some issues with that. So always try to get the right advisor, the right lawyers, the right company, whatever when you do these moves. So the European play, Portugal, Spain, Greece, sometimes Italy, of course, can be a good one. Italy, if you are ultra network individual. Daniel, if you are anything above 10 million, you should seriously consider Italy for the flat tax right now before it increases 200k per year for 15 years. Of course you are paying 3 million. Okay. In 15 years. But you are living in Italy, to be frank. If you compare it to Monaco, of course you're going to spend even less in terms of. For your life and you are having probably the best lifestyle and experience. But I'm biased on this point as Italian, so I would not want to.
- [13:52]
A
That's all right, you can be biased.
- [13:54]
B
For me it's the best. To be frank, I always make this joke. I think the real accomplishment in life would be to be able to afford the flat, 200k flat tax yearly for relocating in Italy under this regime because it means you need to have at least, well, at least of passive income. Anything north of, I would say at least 4 or 5 million yearly. Right. Otherwise it doesn't really make sense.
- [14:17]
A
Right.
- [14:18]
B
Ideally 10 million, I would say. So this is a bit Europe. If you want, I can tell you a bit more of Middle east and Southeast Asia.
- [14:26]
A
Yeah, I was going to like, that's what I was going to ask next anyway. I mean, like, obviously you've built your business around, around Portugal. Right. And so I'm assuming that's because you noticed that that like that was the area of greatest demand or at least the easiest area to form a business around. But for people who aren't like, you know, could you even give me a list of like where, where do people seem to be? So we've said, you've mentioned kind of where people are coming from. Where are they going like where. Where does it seem to be the greatest demand that they want to move their capital to? Because I know Dubai is a, is a huge hotspot right now. Can you tell me a little bit about that? And then other places of where you're seeing people kind of move their capital to 100%.
- [15:01]
B
So especially from the UK, Canadians, sometimes Americans, although Americans, you know, there is the worldwide citizenship based taxation. So South Americans. So Dubai and the UAE in general is still one of the greatest hotspots. I would say I would do this, this kind of list on the go. So Dubai. Then there is the cheaper version, quote unquote. Don't please interpret it wrong, I will expand it later. Is Thailand if you like. Thailand. Yeah. Portugal I would say still. Well, it's apparently the number one destination Americans dream of relocating to. Recently there has been an expatsy survey. I was reading this yesterday. Well, the old school move is always Monaco, right in the end.
- [15:48]
A
But that's just like it's gotta be, it's a big barrier to entry, right? Like you gotta be really wealthy. And I think, you know, correct me if I'm wrong, but what you're like describing to me is a lot of people who are kind of who aren't yet wealthy, maybe they're not, you know, they're, they're on their way. And you know, a place like the US or Canada or whatever, you can make a lot of money, but you're also paying a lot of tax. Right? And so while it's easy for people to focus on investing and their gross return or their gross income, like tax optimization is really actually giving people the opportunity to focus more on their net return. Because if, if I can save myself a 20% on tax or if I'm paying, if I'm paying far less tax in one country than another, that my take home, pay my roi, my on my, on my business earnings is way higher on a net basis than a, than a gross basis, right?
- [16:41]
B
There is a. You know, these would be the kind of the pure digital nomad play, right? Where maybe you earn 10k per month in your country and somehow you need to spend, pay taxes and then maybe net you get 6K. Okay, if you're a digital nomad, eventually you can spend much less, you save, you allocate again Bitcoin ETFs and your wealth keeps compounding. So it's a sort of I compound my wealth. Even if I'm starting, I'm in my 20s or in my 30s, I sold maybe a small Business or a larger one. And I want to get better eventually capacity of creating wealth. These are the moves. You're completely on point. So if you want to focus on those ones, maybe building their wealth. I'm like about 37, someone in their 30s or maybe earlier. This is my kind of list. Paraguay, Dubai, Thailand, still Singapore. Again this is my personal take. Portugal, eventually Spain. In my view, it really depends. There are two major choices to do Daniel, which are either you go full digital nomad and this is perfect if you don't have family. But still I know people with family doing it. Full digital nomad means either you choose Dubai, either you choose Thailand, Paraguay. You find a country that lets you radicating yourself as tax resident and then you keep moving yourself every two, three months in different countries. I lived this lifestyle for a few years. It's nice for short terms.
- [17:57]
A
Yeah.
- [17:57]
B
For longer terms it's very, very. You know, you don't enjoy anymore, but you learn a lot. So this is one play. Place yourself in a tax optimized, tax free eventually place. Paraguay is ideal for this. A lot of people I know, they are Paraguay residents and they keep traveling. This is one play. The second place, no, you want to live. This is more. I'm creating these kind of terms. The first, you know, this first hypothesis, it's a sort of digital nomadism. Pure play. It's like the extreme one. The second one is global citizenship. So people maybe in their 30s deciding to meaningfully relocating. In that case. I still love Dubai. I think it's an acceleration place. So it also really depends in my view if you need a place where to build and also to increase your network. Or if you need just a place where for lifestyle and your business is online, is in the cloud or in a different country. Dubai is a place where still money actually comes. Well, you can still make money. People talk openly about money. Contrary to Europe also culturally. So in Dubai you can find accelerations for your business. So if you are looking for these opportunities, Singapore, very expensive place. A bit more than Dubai. Restrictive as well. Personally the best wealth protection place. And it's a sort of. It's a sort of the equivalent to Switzerland for. For Asian gender in terms of capital. Highly recommended also for startups as alternative to Delaware. So even you can raise funds from American investors via safe. You know why Combinator Safe? So many startups actually can be successfully based in Singapore. That's one of my favorite spots on earth along with Dubai. So Dubai and Singapore for sure. Portugal is more lifestyle, but you need to build Your system. Because here, to be frank, the bureaucratical engine slows you down. So you need to keep yourself active in order to not be slowed down. Paraguay already mentioned, there are a lot of people in love with South America. I'm not a specialist, but I have friends who are. Apparently Florianopolis is a place only for lifestyle. You don't need to be fiscally resident there. Renopolis apparently is one of the hot spots in South America right now. And many people are very happy. Both in Mexico or Medellin for example. But I'm not an expert. My take is Dubai, Singapore, Portugal and Thailand. Thailand could be a great combination, great choice in terms of. If you are an indie hacker or you want to save some money, you can have a top lifestyle with probably 3k per month. 3.5k per month and at the same time it's a 0% taxation for non remitted money in the country. With some nuances. I'm not going to expand here, otherwise it's a bit boring. So if I was in my 20, I would be either Thailand or Bali eventually for India hacking else Dubai, Singapore could be a solid choice. Even just for 90 days in Dubai gives you the tax residency and then you can eventually travel around the world. So the combinations are multiples, but these are a bit the kind of autumn. To be frank. I always ask myself, isn't a bit of paradox that these places somehow offering you a higher degree of freedom? They are by definition non democracies or republic, like the Kingdom of Thailand, the Emirates in Dubai in the uae.
- [21:09]
A
Sorry, it is funny.
- [21:11]
B
It isn't funny, right?
- [21:13]
A
Well, yeah, it's almost like, you know, it's a trade off. You get like maybe a more autocratic government, but a more free economy. And then, you know, whereas in. In some of the other countries where there's democracy, you get a more free government, let's call it, because you can vote, but you have a much more restrictive economic structure.
- [21:30]
B
A hundred percent. It's always a matter of trade offs and perspectives of what eventually you prioritize in a specific phase. And these are very interesting topic that would bring us in more socio political considerations.
- [21:43]
A
We can go there if you want. I mean it is kind of funny. Like it's an interesting thought experiment, right? Because it's almost like these democratic governments, they have to spend more and more. I mean this is like a classic thing that's observed by many economists, the political business cycle, right? Like heading into elections. Governments spend more money to try and buy votes basically. Right? That's the easy way of saying it, a hundred percent. And so they become these really big clunky bureaucracies that are expensive to run, which means they need, they require high taxation to keep that expensive machine running. But the consequence of that is over time you end up paying for tax burdens that past generations voted in. Whereas, you know, some of these more autocratic governments, they do whatever they want and often that ends up being a good thing. I mean, autocratic governments, I think they, they're interesting in such that they have to keep people really happy because I think, you know, like they, there's, there's estimates that like, you know, 10% of the population is unsatisfied with you. You could have a violent uprising, right? So an autocracy actually has to maybe like, you know, in a democracy you need 50% of the country to, to be in support of you enough to vote. But in, in these autocracies you might just actually need to satisfy a larger port population because otherwise they just turf you and have a revolution 100%.
- [22:55]
B
And if, if I may add, you know, especially recently, I always ask myself, you know, about, for example, let's look at the state of Democracy in Europe. 4% on average in each country of population actively participates to parties, you know, political parties. So this means that 4% eventually predefined the candidates in the different parties. Then about 65% on average in Europe vote. But for European election only 50% vote. So and by the way, the European Commission is not elected, is actually defined by the head of state. So sometimes even when it comes to democracy, we should really ask ourselves to which extent the real, you know, freedom of choice at the current stage happens. My take is it's always a matter of. Very often I have this more. These are more probably original kind of direction of thought and theory, but I'm a great fan of special economic zones. Singapore Singapore until 65 was Malaysia. They created a, you know, Dubai contains. I'm not, I'm not sure if 47, whatever a lot of free zones, which means areas where there are administrative or fiscal exception exemptions. Maybe a specific and different civilistic and commercial legal framework. Prospera is a recent project open in Hondura and so far and so on. So there are many special commitments almost in every country of different shapes. In my view, the future will be a series of maybe new smaller cities, new Singapores, let's say new Dubai. And people will be able to choose. I want to be in one. And everyone will be maybe based on different systems. Some are more a bit Autocratic, other ones more capitalistic, others more democratic, more Republicans and people will be able to choose. This is, in my view, where they. From a macro geopolitical perspective. In the next 30 years, especially with AI, we will go. But for now, to be very frank, I'm not a real estate guy, but I'm very attracted by south of Italy also, eventually, for my personal interest. I think these are topics, you know, very well. But it's crazy right now. South of Italy, probably It's like Portugal 10 years ago and Portugal instead, it's very high.
- [25:06]
A
Yeah, that's what, that's what Tim was telling me. He's like, you know, Portugal. Yeah, I mean, I mean, Portugal is less of an emerging market like they did. They did a really good job at building these tax structures early and during the, like, their timing was impeccable. Right. 2020, everyone was decentralizing the workplace, all of like the gig economy. And, you know, digital nomads were moving all over the place. And they made it really compelling people to do that. Italy lagged a little bit, and. But now they're dealing with obviously a pretty big demographic collapse. Right. Like, Italy's population is in pretty substantial decline. And so I think they're trying to backfill some of that, it appears, with trying to ramp up immigration. And they're being a little bit more. I think they've had the opportunity to learn from Portugal and Spain in what works and what doesn't work and what are the negative externalities. But if you just look at what happened in Spain or Portugal, where, I mean, and maybe let's talk about some of those consequences. Portugal created this golden visa program, created the digital Nomad program, and then housing affordability. I think Portugal had the worst deterioration in housing affordability for locals since the beginning of the pandemic. Right. And actually, this is what I was telling you before we started recording, I posted this chart how Canada had the second worst deterioration in housing affordability in the world. And when I posted the chart, Canada was number one, or Canada was number two. Portugal was number one. And actually the. The chart got picked up by a bunch of, like, Portuguese media. It was like, it's a viral. It was a viral post in Portugal. Everyone who posted sharing the post was in Portugal. So I, I guess can you tell me a little bit about those consequences? And then how is Italy going to follow down the same path? And if so, does that mean that there's an investment thesis to be found in maybe Italian real estate if they do end up, you know, increasing the Demand substantially a hundred percent.
- [26:47]
B
Let me share you a personal story because I think these are sometimes the best. So I, I have two very traditional Italian parents in Rome. They, they, they, you know, they're a very traditional, you know, kind of European real estate oriented person. They, they spend probably they, they've been focused in maybe accumulating more towards real estate rather than stocks and so forth and so on. These are typical play at least for, for mid class I would say European and South European families. And we managed to get an apartment in one of the arguably one of the most prestigious okay areas in Rome. It is very well known in all Italy because it became a sort of brand. Now it's like Gangam whatever in Korea or whatever. So the paradox then is that this apartment that we still have in this area at this fantastic apartment costed years of you know, whatever payments. Now it's much less worth than the average, you know, Lisbon apartment. And this is absolute crazy. And I have so many other stories like people of 7.8x of value appreciation in Portugal in Lisbon, but Porto also and so far and so on. So what is my honest key? Take take away as a, as an allocator. I'm not a real estate specialist but I am an allocator also for me, for my family. My wife actually she's a real estate construction in Portugal. So we have firsthand information in detail for residential and commercial. The real problem in Portugal has not been golden visa investors on real estate. So if you look at the statistics, the real problem in Portugal has been the capacity of yearly production of new housing in Portugal hasn't yet recovered compared to 2008. So I don't remember now the stats but if I'm not wrong I go by memory it is weeks ago in 2008 there was like something like 120000 whatever new houses built every year. Don't take this number literally. Now we haven't there got back to that number. Why? Because the system collapsed. So in Portugal they are. We are not able to produce every year enough new apartments in the capacity of insiding impacting on the demand side of foreigners is too small. Because if you look at the stats, the population of foreigners is a very tiny fraction of the global population. So what really happened is yes for sure foreigners had a role. But concluding that the foreign capital has been the major responsible for the price increase in Portugal is technically wrong. Is the system that actually from 2008 the supply declined and the demand eventually steadily increased. And why regulations. You need three years for getting A license. And this is crazy. So there are. This is something. We can chat about this later. These are one of the paradoxes of Europe that needs to change. So bureaucracy reliance of the economic system for building new houses in terms of contractors reliability, efficiency and so far and so on. So this is the reason why Portugal essentially created a policy in policy and bad economy loop inducted incapacity of creating new housing and then boom. The prices they keep raising up. From a real estate perspective. Also can I drop an alpha? Because I was chatting with a friend of mine who Portuguese several generations of people in both real estate and hospitality here. The landscape in Lisbon specifically will change with a new airport that will at a certain point in the next few years come up in south of Lisbon after the bridge. So they all. If you look at the map, there is Lisbon, then there is a bridge and then there is another area, for example Cabarica. So Lisbon will become the district of Lisbon will enlarge. So in my view there are. In my view everyone knows actually that there are opportunities in the upcoming district of Lisbon in that in 10 years will be even easier to be reached out by the new airport when will be built. And that's why there are massive speculation activities still happening in real estate for this reason. And sorry, I forgot one important point. Another issue in Portugal has been that as crazy as it may sound, there is an incredibly high number of houses and apartments not available on market because of inheritance disputes. So this is something even from an internal perspective is crazy. Like yeah, essentially hares fight. And you can put these assets on market, you can Google or perplexities all these disinformation. For anyone listening, you can find all the data. So is Portugal still attractive? To be frank? Yes, apparently especially in certain areas, prices will go still up differently from Spain. Nobody here is discussing to tax taxing 100% non European investors, which is. You probably know it, right? The crazy proposal advanced in from the social socialist government in Spain. Portugal still remains Spain. I think Timor is an expert on these. I think it's early for saying that for sure they will introduce this 100% taxation. If they do well, I think for many non European Spain will go out of the market right out of the table.
- [32:15]
A
Yeah, I mean it seems like you see this rise in. I mean, because it appears that there's a comparable populism forming in Portugal, right? How much do you see those things being a political risk in certain areas where I mean like obviously Portugal less likely because the government isn't really on side with that. Like they Are insane. But I mean maybe not in the short term, but is there a significant degree of legislative risk from your perspective.
- [32:40]
B
On investment theses like this question. Great question, because in Portugal then you consider that in 2023, October, the Golden Visa rules changed and real estate became not anymore an investable eligible investment for Golden Visa. So if you look at the charts, the prices didn't move down. So according to many. Hey, hold on. If the golden miss investors were the, you know, the responsible, why the prices haven't gone down yet? Right. So at this stage we believe most of even the politicians realized hey, foreign investors aren't the problem. Maybe they are a co cause, but they are not the primary cause for these turn of events. So this is the reasonable I think take. So I don't think personally that a populistic eventually push will bring eventually towards political proposals closer to the Spanish model. I rather believe that eventually there will be maybe a change in the Golden Visa investment scheme. They will allow social housing investment and I personally am in favor of it. New buildings, social housing oriented. So this could be something maybe very good for the country. But I don't see crazy non European taxation happening. Especially because let's keep in mind something important. This is more a very insider take and it could be wrong. It's very subjective. You know, Spain, Italy, France, Greece, we are large countries and we have our own kind of internal market. Every city has its own network, has its own entrepreneurial network. We are larger countries compared to Portugal. And because of this, for example, we are not so open to foreigners. If you go in Madrid, you need to learn Spanish. If you go to Rome or Milan, so and so. But for sure, in Rome or Bari you must learn Italian French for sure. And they will of course in Paris criticize you because of your imperfect French. So Portugal is different for this. Okay, so this means that they culturally always welcome and they had probably to welcome foreigners. And they built and the system sought to welcome and incentivize more foreign capital and foreign talent. Even the current efficient. So because of this distinctive actually history and potentially pre existing reality, 10 million people versus 67 on average. And therefore international openness. Even the TV, sorry, the television, the TV movies here they usually in the past, even they didn't get captions, Sorry, Proper. Proper translations. They. So that's why population learn English. So for these reasons I don't think Portugal will ever close to foreigners. Because culturally has been and will be in my view open to. To international influence.
- [35:32]
A
Yeah, I think Canada is very similar in that regard. Like it's such a, it's such a big. I think many countries that are facing this demographic challenge of, you know, falling below the replacement rate and not being able to, to grow their population organically, which is basically everywhere outside of Africa, right? Africa is really the only place that, where population is growing organically. I mean, even places like China and India have fallen below the replacement rate. I think that most countries on earth will end up having to follow similar things and ones who, I think the ones who continue to iterate and fix like the. Rather I don't, I think, I don't think it's like. I think Spain's approach of it's either yes or no is, is a wrong approach. Right? They did it. They did a really good job. And then there were some externalities and their population pushed back and rather than saying, hey, let's figure out a way to make this work, they said let's shut it down completely, right? Or let's, you know, let's take an extra very extreme action. I think companies or countries like Portugal where they can, they're kind of gradually fine tuning it. It really is probably the ones who are going to survive and in five or 10 years after they've iterated a couple of times, we'll have a really, really good system and an economy built around that. It appears that that's sort of the way that things are going. They're actually building an entire industry, an entire economy. Businesses like yours are existing and being built because of their willingness to iterate. Right.
- [36:48]
B
100%. That's a great take actually. That's a great take. I have a kind of thesis about Portugal, especially in tech. So Portugal, for many reasons, especially Lisbon, but also Porto Algarve, has attracted, compared to any other European country in the last five, seven years, an incredible amount of people and workers in tech. Founders, especially in crypto. But not only. Sometimes many founders, maybe they have their company in Delaware, their company Texas or Singapore in terms of incorporation. They raise funds from the US but they run the company for part of the year from here and they have teams here. So long story short, you need especially for ecosystems. This is worth in tech, which is the area I'm daily involved in. But I guess it's the same for any area. Daniel, you need talent density and you need that kind of energy that helps you creating escape velocity. And Portugal in my view, has been able to attract the people for now, but not yet the companies. So you first they attract individuals. But incorporating here, to be frank, it's still for now problematic. So What I think is going to happen is. I don't know if you heard of. There is this proposal called the 28th regime. This was incorporated in the Mario Draghi report Compass Report to the European Commission. And there is also a private movement of stimulated by a few actors, Andre Klinger, former CPO of Productant and VC investor Peter levalzio and a lot of people including me from my humble position, I'm trying to to push for this this project named eu, EU Inc. Or European Incorporation. So the project wants to have a single legal framework for tech companies or startups across Europe. Now if you search this online, especially in the version proposed by Draghi, if 80% of the initial proposal by Draghi becomes In the next 36 months reality Europe and specifically Lisbon is going to become the best place where to build companies. Why? Because potentially you can create the equivalent of an incorporation in Delaware, in everyone in 27 countries in Europe with the same legal framework. Potentially you have similar employment law, dissolvency law, you can fundraise with safe. And essentially you cut all the, allow me to use the term B.S. okay. The typical B.S. from Europe. Okay. So this is in my view the real need for finally Europe coming back on track, removing the bureaucracy. And in my view the country that will benefit in the short term the most is Portugal because of the talent density of Canadians, Americans, British, of course there are so many British that are already here. So this is in my view how Portugal, that kind of approach that you are suggesting of probably trying to fine tune and improve and validate and essentially the new models, in my view it can be very successful. For example, if this EU Inc. In whichever form will come to existence in the next few months. 40 years.
- [39:51]
A
Very interesting. I, I want to be respectful of your time and I know we typically only plan for about 45 minutes on, on these episodes. So a couple things I want to ask you. Number one is can we have you back on the show? Because I, I like what some of the guests who are like really have deep knowledge and like just want to have you almost on as like a regular to talk through this stuff like on maybe a quarterly basis whenever you feel like there's something worth updating.
- [40:14]
B
I'm super honored and happy because for me these are incredible opportunities for exchanging ideas, learning from different angles and to be. To be. To be frank, you know, this is something I love to do and vice versa, I will invite you to my podcast because I love to do these, these, these kind of conversations and we have so many topics to, to address. We very touched like 2 or 3%.
- [40:32]
A
Because we just scratched the surface for sure.
- [40:34]
B
I'm really happy anytime, very glad to come back, even if we want to. Maybe very happy to. To helping and supporting this conversation to happen. And I really like the idea of trying to bring new ideas and maybe different ideas to people from Canada, more in real estate. And for me it's. I have a lot of questions as well. I will actually go to binge. What? Binge listening, actually. Or watching your podcast.
- [40:56]
A
Yeah. Cool. Yeah. So there's that and then I think, you know, if people like I'm. I've been really attracted to the stuff that you're saying and I've been reading a lot of your stuff on Substack and on X and all of that. So could you tell me like, for anyone listening, where they should connect with you, where they should read more about what you're talking about if they want to get kind of deeper into your brain, deeper into all the great information that you're putting out there, like, where should they find you?
- [41:21]
B
A hundred percent. So I publish every week, at least once a newsletter. The name for now is the Alice Letter. It's on Substack. It's Palombo, which is my surname. Palombo, P A L O m b o doc, substack.com. but the easier way is on X. On X I have the handler. It's D alle Palombo, simply because any other version was already taken. So it's D Allembo a L E Palombo. And I'm very active there. DMs are open and generally, you know, I try to do deep dives and not on. On so many topics. And I really look forward to. To chat more and if you have any question or, or even, even special request, I, I would love to. To hear from anyone.
- [42:00]
A
Okay, awesome. Yeah, we'll do that. Anybody listening? If you have any, any specific questions that you want Ali to con to answer on the next episode, we'll try and have you back maybe towards the end of the summer, maybe September, something like that for another discussion. Honestly, I really appreciate your time. I feel time. We'll schedule like an hour and a half or two hours and just do like a really, really long.
- [42:19]
B
To be. To be frank, I'm a great fan of. You know, many people are like I. They love. You know, I like to be short, but to be frank, I like. If you want to do even two hours, I'm absolutely in, man. Also because I will be now in. I'm going to Prague. I'm going to travel in New York San Francisco. Yeah connecting with a lot of people and and I I would like to bring also the the latest from from the the US I will meet a lot of investors and operators so yeah happy to in September to catch up.
- [42:45]
A
Yeah let me know when you're in New York too. I'd love to fly down and meet you.
- [42:48]
B
Oh really? Okay I will yeah sure.
- [42:52]
A
Yeah. Okay yeah 100% let me know. Amazing. Okay well everybody yeah well I guess look forward to us having maybe a two hour discussion and we'll have Dave on that one my co host and yeah no I really appreciate your time man and and and can't wait to have you back.
- [43:07]
B
Amazing. Thank you so much Daniel for inviting me and looking forward to to chat again in September so Likewise.
- [43:11]
A
Thank you.
- [43:12]
B
Thank you.
- [43:12]
A
Take care.