São Paulo mayor and former businessman João Doria has pledged to cut the time it takes to open a business in South America's biggest city - to just two days by May 31, 2018.
Speaking this week at a franchise even, Doria, claimed he had already slashed the time it takes to register a business from over 100 days to just seven days, since he launched Empreenda Facil - a programme to make the city more business friendly - on May 8
The programme is being carried out in co-operation with the federal government’s tax authority, the government’s small business agency Sebrae and the state government of São Paulo.
Doria said on June 21 that up until May 31, it took a minimum of 128 days to open a business in the city (Endeavor Brasil in a report however had it at a minimum of 136 days in 2016, putting it ahead of several other Brazilian cities, but behind others like Belo Horizonte at 62 days and Uberlandia at 52 days)
Doria’s office is targeting to lower the present seven days to five by December 31 and two days by May 31 2018 (which Doria says is on the level of countries like Germany, the US and Norway).
'Among top five'
It will make São Paulo among the five most entrepreneur-friendly cities says Doria,
Since the programme was launched on May 8, a total of 18,000 applications have been lodged, according to a report on June 19. It translates to double the average of 250 applications per day under the old system, the city government says.
In this first phase, the city is processing only applications involving businesses that do not need specific licenses to operate. These make up about 80% of firms in São Paulo.
Yet the programme is not yet working at full steam – it took one entrepreneur 30 days to register his business, according to one report. Still it’s less than a third of the average time it took under the old system.
A key reason for the current delays – according to a newspaper report earlier this month – is that entrepreneurs must still apply in person for a municipal tax registration number for their business, with the waiting time earlier this month reaching two weeks. The city authorities have pledged to move the process online by the middle of next month.
However the city’s secretary of innovation, Daniel Annenberg said most of the appointments have been concluded on time and denied that the system was overloaded.
Since taking office on January 1, Doria is following up with a promise to clean up São Paulo.
He’s launched a programme to beautify the city, tackled the city’s famed graffiti and tagging problem by jailing taggers and with mixed results has tried to remove a crack neighbourhood, one of the city’s infamous eyesores. He’s also seeking to privatise many of the city’s properties and assets.
It’s not just São Paulo. Argentina earlier this year passed a new Entrepreneur law which among other things will allow for the online registration of companies in just 24 hours, down from the present over six months.
During his eight years as head of Buenos Aires state Argentina’s president Mauricio Macri – also a former businessman – turned the capital into a leading entrepreneurial city.
He did so largely through offering free business training, venture capital and getting players to work together for example through backing co-working hubs. This, despite the country’s status as a laggard when it comes to doing business.
In 2015 the city was selected from more than 50 cities as the winner of the Global Entrepreneurship Congress’s Cities Challenge (see this publication by the Global Entrepreneurship Monitor’s for more).
With two thirds of the world's population expected to live in urban areas by 2050 according to the UN, getting cities to become easier places to do business is crucial.
Much of this growth is expected to take place in emerging economies, making it critical to turn cities there into hives of entrepreneurial activity.
Timm is a South African who writes on small business. He lived in São Paulo from 2014 to 2015. Click here to sign up for the monthly Small Business Insight newsletter.
Stephen Timm is a