Attorneys at law “Bachynskyy and partners” provide legal assistance and consulting to foreigners from almost 85 countries of the world. Lawyers do not only provide their service professionally, but are interested in the lives of their clients, as well. Because they can tell a lot about their countries and its inhabitants – their traditions, rules of business, politics and laws. In addition, it’s always interesting to find out why successful businessmen and employees from other areas move to work and live to Ukraine. That’s why AL “Bachynskyy and partners” decided to create a video blog “Expats in LVIV blog” and to communicate on these topics with guests of our city from other countries.
The first guest of the newly created blog is a businessman from the United States Leon Guerrero. In his country he worked with Real Estate Investment and Technology Start Ups. He moved to Lviv a year ago and now is a Managing Partner at Lion City, LLC. Taras Bachynskyy, Managing partner of AL “Bachynskyy and partners” met with Leon to hear answers to the most interesting questions – from a comparison of doing business in both countries to the advantages and disadvantages of insurance medicine.
The number of foreigners who come to Lviv and stay here for a long time or even forever is increasing every year – says Taras Taras Bachynskyy. Each person comes here for different reasons. Among them are business affairs and family reasons. Lviv is becoming more and more interesting for investments. Lviv is the place for international conferences and international meeting are held here. The city attracts tourists with its festivals and architecture. However, it is still interesting why foreigners are coming to Ukraine and what is the reason to come here. Let’s discuss this issue with our guest. His name is Mr. Leon Guerrero, who has come here, and is residing here more than one year.
T.B.: Hello, Leon! It is nice to meet you in my office!
So, we are going to speak about your experience in Ukraine. Our basic question to every expat in Ukraine is as follows: what made you to relocate to Ukraine? As far as I know you have been residing in Mexico and then in the USA. So, why Ukraine?
– There were several reasons. Basically, when I was traveling when I finished university, I have visited Prague, Czech Republic. I saw how dynamic and how it was growing and how it was coming out of USSR era. Everything was moving forward very fast. The beautiful cities that has never been known to anybody in the western world until that time, late nineties or early two thousand. So, it was transition era and everything being just crazy to actually starting to be actually businesses. That is one of the things I see in Ukraine. So, I see a lot of potential in this country.
T.B.: Namely in Prague, yes?
L.G.: Yes, like Prague and like Lviv, Kyiv and there is a couple of cities here, in Ukraine that I have the same field, the same bide, the same energy of everything moving forward and coming out of cloak that were Russia and USSR and actually coming out into the western society.
So, the western world is still barely catching up to here. It is the country that has a lot of really smart people, very hardworking and they would bridge the gap between what I know from my experience in North America to Ukraine, bridging that and making the business forward.
T.B.:If we speak about the differences in culture and business between three counties you visited, because we know that you have the experience in Mexico, the USA and Ukraine. You have been residing here for more than one year. So, comparison all of these countries, is Ukraine more similar to Mexico or to the USA?
L.G.: So, culturally it verges differently from the USA. It is because of the USA is not so much catholic, religious country. Mexico is much more similar to Ukraine than the USA.
T.B.: I remember you show me a picture of catholic priest who was blessing the office! It is so strange for the USA! But it is natural for Mexico and Ukraine!
L.G.: Yes, it is supernatural for Mexico and Ukraine!
There are a lot of similarities in Mexico with Ukraine. There are a lot of very similar mentalities in work. Mexico does have one great thing. It is a neighbor, one of the strongest and powerful country in the world. So, we get a lot of influence from the USA.
T.B.: Is this influence good?
L.G.: Mexico does a good thing too. It takes an influence and makes their own. Sometimes they do not grab the best things. But normally do so. It is much more progress like in the USA in business. But certain things, like you said, that priest blessing the cars, houses etc. That is much more like people have the people eye are raised Mexico in Ukraine. The great different in the USA is that you never know who is your neighbor, because you do not talk to your neighbor. In Mexico you talk to all of your neighbors.
T.B.: I think Ukraine is more likely to the USA, because a lot of people do not know their neighbors. It depends on neighborhood. But I think it is not so friendly as it could be considered from the first glance.
Also, I remember another cultural story, which you told me when we were sitting in the restaurant. You told me that in the USA all people start eating the dinner all together. In Ukraine it is not so popular because the restaurant is delivering dishes in different time.
Is it true? What about Mexico?
L.G.: That thing with food here is very different. Also, the incentive-based market is not here, so, in the USA and Mexico there is a big incent of the tip.
T.B.: It means that you are obliged to give a tip?
L.G.: That makes people work harder so they are bringing the food on time and everything. And here it takes hours to get service done.
T.B.:But if you pay three dollars per service of thirty dollars, it will make little difference.
L.G.: Yes, there is little sort of difference. What I see here is that everything is moving forward so it is going to catch up to the world, because everything is now connected by social media, internet and communication is so fast. So, everything is connected now. What you see over there, it comes here. You can see younger generation, everybody has smartphones and everybody can see everything. The generation of twenty years ago from now has change a lot. They moved forward faster than we did before.
T.B.:So, let’s speak about your business experience. As far as I know, you have business in Mexico or maybe in the USA? May you tell us something about that?
L.G.: Basically in Mexico I have a couple of business. One of the things I want to do is to bring that here. We do a couple of outsourcing staff in Mexico too, including real estate. I am general entrepreneur so I have many businesses. My last business was an application for the cayray sharing businesses that you can actually do prepaid system where you do not need a credit card or a bankcard to use this services, which you need. So, I did it in 2015 and I sold it in 2016. I finished this transition in late 2016 and I came for the first time here in summer of 2017. So, basically I sold that business and cane here to start thing that we could do. I have been here for more than year as for now.
T.B.: When comparing your first imagination one year ago and now, what are the top businesses to invest in Ukraine? Because, since you have sold out your business in Mexico, it means that you are going to invest here in Ukraine. How did your experience change from the moment of year ago and now? What are the changes? Just compare your first impression with what you feel now.
L.G.: First impression was that everything was moving forward and there is a lot of energy and a lot of people want to do a lot of businesses, but sometimes they have not tact to North America. So, basically you have to make an investigation. You cannot just come and know what to do, because you have no idea how the people act, how the people work.
T.B.: So, before you invest in Ukraine you recommend, first of all, to have a check.
L.G.: Yes, basically you have to understand what you can do here. You need to investigate. You need to live. You need to understand country and culture.
T.B.: How long do the investor should stay in the country to understand?
L.G.: I am still learning. I have been here for year. It is not enough. But what I understand you can do here, in Ukraine. Ukraine has very talented people, hardworking people. So, bringing the gap between developing services to where you from that is one big opportunity. So, obviously in ninety outsourcing and business process management outsourcing that is one of the biggest thing that Ukraine has. So, ‘Top 3’ IT and outsourcing country in the world are: The USA – first, India – second, Ukraine – third.
T.B.: And where is China?
L.G.: China is like a fourth, fifth, sixth, maybe.
The thing they do have many smart people, but they do not so many them doing IT-sector.
So, those things are very different and basically buying low and selling high.
Ukraine has many natural resources and products that you can buy a very good prices and sell them whatever country you from. They have a lot of agricultural projects. They have a lot of handmade projects here. They can sell the products to North America.
T.B.: So, finally, resuming your business experience you have done IT-business. Is it right?
L.G.: Yes, it was outsourcing services, digital and IT-services.
T.B.:What are you going to invest here, in Ukraine?
L.G.: Well, first thing we will invert is real estate. Real estate is something I really know very well.
T.B.: It is the safest investment.
L.G.: Yes, it is a great investment! Everyone wants to invest in real estate. Everything here is moving forward, but still there are some problems with the real estate sector, but it is changing. So, we see a lot of changes.
T.B.: Bureaucracy changes.
L.G.: Yes, bureaucracy is changing for positive, especially in this city. The mayor and deputies, all this team, are doing very well.
So, there are a lot of positive changes moving forward in real estate. A lot of countries are looking to invest in the emerging markets, but do not how and do not people here. So, the real estate is a big opportunity here for Ukraine.
T.B.: A lot of foreigners are afraid of investment in real estate because of different reasons. First reason is military situation on the east of Ukraine. Second reason is cheaters.
One of my clients told me that he had bad experience in other countries and he supposed such situation in Ukraine.
So, first question is whether you have ever had experience of frauds in Ukraine speaking not only about the investment in real estate, but also about any kinds of frauds. Can you share that experience and make some recommendation about that?
Also tell us about other threats which you feel before entering Ukraine and whether it was the real threats.
L.G.: First thing the military threats that is actually a big lie.
Yes, there is a problem in the east of Ukraine. Russia is interested to maintain Ukraine very turbulent for their own reasons.
Also, Russia is finishing from the old guard, like the KGB, the President right now. I think if anybody new comes in that isn’t from him, it will be totally different. Russia has changed. There is no reason why Russia should the enemy of the world. And he still wants to the enemy of the world. That just because he takes personal gain of that. That is the one reason. But everybody else doesn’t.
It is not the true about tanks on the streets industry. The USA State Department says that is only three per cent of Ukraine that is actually has problems. So, that is very little. It`s like saying: “Don’t go to the Florida because there are riots in Los Angeles”, that’s crazy. The country is so big; this is one of the biggest countries in Europe. It`s the politics and media that creates these rumors.
I did get money stolen from my purse, but that happened everywhere.
We paid for services, that they did not do; for some technologies services, that we did not want to get. Also, we invested in digital-marketing company.
T.B.: Did you lose a lot for that technology services that you invested?
L.G.: It is objective. But the thing is that you always know you can have the problems, you can get a tough all around the world.
T.B.: Is it possible to be in the same situation in the USA?
L.G.: Yes, you can get a tough in the USA. You can get a tough in Mexico.
T.B.: So, you paid for the services and them were not delivered.
L.G.: Those countries are much more advanced in legal issues. One recommendation is to get a good lawyer that can help you to do the diligence of that. And even with that, you always can have some omission.
T.B.: It can be some objective reasons.
L.G.: There are so many reasons, that things can go wrong. I mean, business is business. There is always a risk. On the emergent market always there is more risk than you are in England than the risk comes down.
T.B.: Comparing the risks to be cheated in the USA or Mexico and in Ukraine, where the risk is higher.
L.G.: I think, it is higher risk to be cheated in the USA, actually. There are much more people, much more sophisticated people.
You can get a tough everywhere. You can have the business problems everywhere around the world. You have to manage them. It can be risk as a part of the business. You can win some, you can lose some, it is the way business is. None have 100 per cent of fail-safe, that you will never lose anything.
My counsel would be to get a good lawyer, such as yourself; just help you to get the local culture, local people and minimize risks as much as you can.
T.B.: One goal thing which I saw when you started business, your first task was to employ the assistant who helps you to investigate the clients, to investigate the partners. So, I think, maybe one of the recommendation would be to get a good lawyer and to have an assistant. What else do you recommend to investors?
L.G.: Try to find someone who is local that can speak your language. You know, first is not always the best. So, try to find someone you can contact on the same language, who understand your culture.
Actually, we found someone who studied in London and understands a lot of business stuff, economic stuff, cultural stuff that we understand. So, you have not to explain twice what you need. But there are a lot of people here, you just have to find them; go through an interviews, talk to people, contact to local embassy, they help a lot, because they live here and they know people. So, you get a lot of helped information; you get a lot of business tips; you get a lot of inside information.
Also, you need to have a good lawyer that speaks your language, can understand you culturally and that is very connected locally. That is important, because it helps you with the local system. And just move forward! There is no secret, no recipe. Nothing special. It is not rocket science. Business is business, and sometimes you can win, sometimes you can lose. But you have just keep moving forward. Then you just leave that and move on to something else. If you have a set of business you are going to do, like me, it depends on what you want to do. There are lots of opportunities, just figured it out and move on that.
T.B.: As far as I know, you were graduated MBA. So, do you recommend it to all the businessmen? What was the school?
L.G.: I did my MBA at the University of Texas at Austin (UTA), Redmond School of Business. It is on the ‘Top 5’ in the world. Basically, I do recommend. Probably, that was the best school I have ever had in my life. I had really awesome teachers, very smart business people, very smart politicians. Their experience was nice. MBA is, basically, an experienced-based: what was if this happened; what would you do in this situation; what would you do in that situation.
T.B.: Have you graduated before you started your business, or while you were making business, or after? Does it make a sense to study MBA, when you have already had the business? I have heard lots of ideas that if you have grown your own business, nobody can teach you, so, you do not need the MBA.
L.G.: It is true. But then you are learning from the biggest, the best companies in the world. So, we called it Howard type teaching. It teaches you what other smart people other smart companies have been done.
So, you cannot say: ‘Oh, just because I have grown my own business, I know more than GE, Microsoft.’ No, you do not! So, you take an experience from Microsoft, an experience from GE and you apply it to your company. I hope, it does help you. I think it is better to have a few years of experience in business, corporation or something. I have not always been an entrepreneur. I worked in the Component, the Telecom. After doing the Telecom and starting the business, then I got my master degree which helps me a lot. Also, networking is a really good do. You meet lots of interesting people; you will be friends with them forever.
T.B.: Yes, networking is very important. Also, as far as I know, your family in Mexico is helping other people making a charity. Could you tell us about that?
L.G.: So, my family is in the USA now. We have the foundation called ‘Teleton’. About what we help with. Right now the number one in the world is to get help for kids with disabilities, for any type of disability that kid has.
One service aria is the hospital that we have in every state. It is free, 100 per cent free. If the kids that have a walking disability, a learning disability, some types of physical disability, they can come for free of charge and get the help they need.
Right now we also launched the oncological (ред. – hospital), for kids with cancer. We have just started doing it in the two states in the USA; and they are in every state of Mexico. I think, the couple of states left where we can do that in Mexico.
Actually, we do too big pharmacing in the year. From the December, that has just been coming up, we have raised almost ninety per cent of money we need to manage everything for the kids.
I recommend, if you are here, to give back. So, we have two foundations now. One of them is to help the grandmothers here. There is a great prom with the money for pensions they get, but it is not enough. Also, we have couple of things with the local government to help as much as we can.
T.B.: If we are speaking about medical service, I have a story about one of my clients from Great Britain. They were so afraid of Ukrainian local medical service that the first time they`ve visited my office they asked me to help to transport them to Great Britain in case of emergency for receiving medical service. They asked for full medical insurance as well. I think that part of that fears were reasonable. I guess, you`ve heard that one United States citizen died in the hospital in Ukraine. What is your experience with Ukrainian medical service and are there some problems with medical service right now?
L.G.: We were to a private clinic “American Medical Center”, they speak English there and serve almost all foreigners as well.
T.B.: Did they have an USA level of medical service, proper equipment?
L.G.: Yes. They did. Also they have a really good staff, it`s basically the same as in the US, but a lot cheaper. There are lots of problems with the medical system in the US, but Ukrainian system is pretty good. One time we were at local (clinic) just to test it out and to see what it is like. And it was fine, except the language was a problem. The doctors here are very good. Of course, like everywhere else, there are good and bad doctors, but in the private clinics they are pretty good, so you will be fine.
T.B.: So the medical service in Ukraine is good and it`s not a big problem for foreigners to get a qualified help here.
L.G.: Yes, it`s not a problem, because there are enough private clinics now and the numbers are still growing.
T.B.: Do you think that Ukraine should take an experience of the USA and implement in our system medical insurances?
L.G.: Yes, but not in the way it`s done in the USA, because it`s very bad in the USA. The prices are inflated, the cost of particular medical service and its real cost differs a lot. Sometimes it can be 15-20 more expensive for something that shouldn’t cost that much. And that is a big problem with the insurance services in the USA.
T.B.: I believe that you can easily get some medical services, like medical tests or an appointment with doctor in Ukraine, it`s very accessible here, but I`ve heard and I don’t know if it`s true, that in the USA it`s not that simple and easy.
L.G.: Partly, yes. If you don’t have medical insurance in the USA you are going to wait in the waiting room to get medical services for a while. And here it`s pretty fast, at least from the experience I had personally. The issue with the insurance system in the USA is really big and it`s systemic problem. 80 % of the budgets spend goes to Medicare and Medicaid, which is helping the people in the USA.
T.B.: I happened to be you lawyer, so let`s talk about legal issues. Comparing legal systems of the USA, Mexico and Ukraine, which has the most effective justice system, best lawyers and costs of attorney services. For example, how much does it cost for an hour in the USA, Mexico and Ukraine?
L.G.: In the USA and Mexico you can have a really good lawyer for 200-400 dollars per hour.
T.B.: The price is the same in the USA and Mexico, isn’t it? I thought that in Mexico it supposed to be cheaper.
L.G.: A little bit cheaper, but again – a good lawyer is a good lawyer. The prices here that we`ve seen are 25 -30 % cheaper, comparing to the USA and Mexico. Of course there are “top 5” lawyers that make 300 dollars per hour, but it`s exceptional cases. Normally it`s a lot cheaper. For instance, lawyer in the USA makes 400 dollars; he\she might make something between 80 and 100 dollars per hour here in Ukraine for the same type of level of the lawyer.
T.B.: If we are speaking about legal system, for example, safety for the investors in Ukraine, do you feel safe, protected be the government when investing in Ukraine? Would you recommend other investors entering Ukrainian market? Are the legal procedures effective enough to protect your business?
L.G.: Yes, I would recommend one thing is to talk to your embassy, if we invest money in Ukraine our embassies will help us in case of a problem. For instance, if some type of politician or political problem, or some gangster comes in and want to take whatever we have, all we have to do is to contact our embassy. Our high lever government will talk to Ukrainian high lever government and the problem will get resolved. I remember a story you told me about a person that came to Ukraine and was going to invest, but there were some problems and the embassy did helped him. My point is to rely on your embassy while you are here.
T.B.: At last, can you say a few words about your experience working with my company and maybe you have some recommendations for us. What can you say about BK Partners and your experience here?
L.G.: The first month we came here we needed to get our legal documentation for several things: for forming a corporation and for residing in Ukraine legally – Immigration services (temporary residence permit), and for real estate issues, of course. With BK Partners we had a very professional service, the staff that you have is also very professional and very intelligent, they know what they are talking about, and that is why we get everything resolved very fast and without any problems. We actually never had any immigration issues. The real estate is one of the things we needed to talk through and with any other legal issues that we`ve been going through you helped us out. The service that we got was very high level, very professional and very knowledgeable, because you know what you are talking about. And something that what we recommend is to get a local lawyer who has ties and who understands what he`s doing.
T.B.: Thank you for coming to my office and thank you for this interview. I wish that we can help with your further business, with investitions in Ukraine to build a good eco system. The more USA citizens we have the more USA influence we have. So you are our influence in the right direction.
L.G.: Thank you, we`ll keep on working with you.