Want to work on Wall Street and live in Split? In the final 2017 look at Croatia’s foreign entrepreneurs (plenty more in 2018) on December 22, 2017, meet Jason, who swapped Ireland Croatia when so many are moving in the opposite direction. So positive is he that he even has a company called www.positive.ie
First and foremost, why Croatia?
My wife and I were living in Ireland. She had just finished her MBA and we were looking for a place to live and open a branch office of my securities trading firm (we trade the financial markets, make markets, hire and train people in both. We considered Munich, Rome, Trieste, Rijeka for a second which she promptly rejected (she is from Drasnice near Makarska, some consider it the greatest small village in Croatia and she wanted to be closer if we were going to move to Croatia), and Split. We were looking for places that had nice summers, close to the mountains for winters, a university town to hire graduates, and a place that had good telecommunications connections for my business running a securities trading firm (think Wall St. or Trading Places except everything is electronic nowadays). Split won because it was the second biggest city in Croatia, fulfilled the previous criteria and was closer to Punica and Punac.
INTRO YOUR BUSINESS, what is it you do?
I manage and own a 50 person securities trading company called Positive Equity. www.positive.ie There are 15 people in Croatia and 30 people in Dublin. We work in the financial markets, market making in a variety of different exchanges and trading the financial markets in North America, Europe, the UK and a couple other smaller places. We hire classes of people to train and trade our systems. We generally hire once or twice a year. We’ve been running for 10 years in Dublin and nearly 5 years in Croatia. It is a dream career, right up there with a professional athlete.
Tell us about some of the differences in your expectations of running a business in Croatia and the reality.
Ireland is a place based on Anglosaxon legal system and Croatia is based on the German legal system. Everything here must be stamped and certified. In Ireland, you want to do a deal, you both sign, witness and its done. Notaries are fairly rare in Ireland–they are everywhere over here, and there is little I like less in this world than paying somebody real money for stamps.
Negotiating the legal system and business system has been fairly smooth with the services of our lawyers Dani Pavlinovic and Vice Urlic from Makarska. So I’ve never really experienced the frustrations that a lot of people talk about when setting up a business. My wife and lawyers may say otherwise.
Employment law and labor rights are a lot more in the favour of the employee. An employee can cause a lot of hassle without any real substance to a claim. Luckily we’ve only worked with nice normal people.
Some things are very black and white, but other things leave room for interpretation. It’s nice to not have a complete nanny state like in the UK and Ireland.
Salaries are nearly the same. But everybody over here quotes after tax in the pocket salaries whereas in Ireland, UK, US, and pretty much everywhere else I’ve done business, salaries are quoted before tax. And the tax here on salary is enormous from a very low level of income. Most countries get up to 50% income tax, but it happens after about 40K euro (before tax) or higher, whereas here it happens when you are making like 750 euro a month (after tax). It really punishes both employer and employee. The employer can’t pay his employee more because of the tax and the employee earns less because of the tax.
Having my worldwide income taxed in Croatia even if the money is earned in Ireland or the US is something to be aware of and prepare for if you come here. 20% business tax is nice. Over 50% income tax is not nice.
Some businesses won’t deliver things to Croatia.
Croatian tax/Posta (Post Office) goes through your mail and taxes you on presents from Australia and the US (and anywhere else outside the EU). Thank you and happy birthday.
Car taxes are really high here. I was all excited to leave Ireland which also has high taxes on cars, and buy a nice car at a normal price like in the US or Germany. Guess again, Jason.
The Dalmatian stereotype of laziness doesn’t exist for anybody I work with. And I have only met hard working people. Now some only work summers, but hey, isn’t that sort of the dream?
What (if any) bureaucratical issues have you encountered and how did you overcome them (i.e. any advice to the would-be entrepreneur?)
Get a decent lawyer. They will take care of everything. Don’t waste your time trying to jump the hoops. Pay somebody else to do it. They will do it better than you, faster than you, you’ll have less stress, but they will relieve you of a few bucks to do it. Well worth it.
Prepare to visit the notary a lot. Prepare to pay the notary a lot. Just suck it up.
Get a lawyer who has practised recently in Zagreb. The Split courts and lawyers down here aren’t always up to date with the new laws the way a Zagreb lawyer is. Our lawyer challenged the courts here a bunch of times on little changes that the courts just didn’t know about. She was correct every time.
How is your product or business perceived in the Croatian market?
We are seen either two ways: 1. For people who know what the business really is, they understand the amazing opportunity that is available in Split and that even if we aren’t exactly like a firm on Wall Street, we aren’t very different either. 2. For people who know nothing, they see it as a gambling casino designed to relieve people of their money. For the record, we take no funds from the public. We hire people to work at our firm, normal salary, but with very large performance bonuses, etc. It’s a normal business that takes places in the City of London, Wall Street, Chicago, except now that trading stocks, futures, securities can be done on the internet, you can do it anywhere you can find or train qualified people.
What were the opinions of your friends and community, were they supportive of your idea, or…?
Nobody ever encourages anybody to come to Croatia, except in the summer. All my Irish friends were excited to have a place to visit in summers. All my Croatian friends said “Split?! Are you crazy?! Go to ZG.”
What are some of the greatest challenges you have faced in business in Croatia?
To be honest nothing really. The lawyer boxed off everything. Setting up a decent tax structure is the only thing that has taken a lot of effort, but I think that is because I have American citizenship.
If you knew then, what you know now, would you have come?
Yes and no. I love loads of things about living in Dalmatia, but I think about what would life be like living in Rijeka or Zagreb. But I don’t regret coming here and I think Split has a nice balance of summer and real life. It doesn’t completely die in the offseason.
I definitely need to make more of an effort to stay relevant in business and my specific business because I am definitely out of the loop, that is both because I am new, but also because Croatia is a little behind the curve on the latest business practices and technologies. That being said, there are some silicon valley type companies in Croatia (Codeanywhere) and Rimac, 21st-century businesses.
What are 3 things you love about Croatia?
Climate
People
Proximity to other countries
What are 3 things you would like to see improved in the business climate in Croatia?
Less nationalism, hooliganism, and bigotry against foreigners, people of different religions, refugees, people of different sexual orientation. For a country that is so safe, so friendly, there is a really nasty streak in some people.
Greater and better education lead to benefits all facets of life
Corruption is better but it’s still here. I tell people it is better all the time. You don’t bribe the police anymore. You don’t give public works people cash for favors. There are corruption stopping elements in the police and judicial system. It is definitely better. But when a guy runs over a boat with his boat, kills two people, and is let off because of some ridiculous flimsy unheard of medical condition, I rage inside. When I hear people paying public doctors for better service in a hospital, I get so angry. The corruption happens in both directions. People are happy to corrupt others when it suits them, but unhappy when they read about it in the papers. And we tolerate it too much. Croatia is making so much progress, but the corruption is still there in so many horrible ways which makes it linger in everybody’s minds, which makes it still seen as somewhat acceptable, or at least an option. That needs to change.
How is it working with Croatians in terms of a business mentality?
The same as everybody else. I’m sure you have the Dalmatian stereotype out there, but you also have tons of hard working smart people. I am blessed to work with a bunch of those people. Maybe Croatians could think a little bit outside the box.
Advice for foreign entrepreneurs thinking of coming to Croatia?
If you want to come here, do it. There are lots of negatives and positives as with anywhere in the world. But it is a nice place to live, with nice people, very safe (VERY SAFE), with a great quality of life. There are lots of incentives to come here. And if you’ve made a mistake, you can always pack up and go back to where you were. No big deal.
