Expanding into Brazil: what you need to know before hiring your first team

Brazil is the market no company expanding across LATAM can afford to ignore, and at the same time the one that resembles the rest of the region the least. Teams arriving from abroad tend to underestimate the difference: after all, it's right there on the map. Then they discover it's another language, another scale, another labor system and another work culture. We live and work in São Paulo, we recruit Brazilian talent for companies based abroad, and we made the crossing your company is about to make ourselves. This is what's worth knowing before the first contract.

Language matters more than you think

"Portuñol" (the improvised Spanish-Portuguese blend) is enough for a dinner, not for evaluating a sales manager. The nuances that decide an interview (how someone tells an achievement, what a diplomatic answer hides, when a "vamos ver" means no) are lost without the language. And the same happens on the other side: a Brazilian candidate interviewing in a language they don't fully command performs below their real level.

The practical consequence: someone in the selection process has to be a native speaker or act as a real bridge between the two languages. If your founding team doesn't have that person, it's the first thing to solve, because it affects every hire that follows.

CLT, PJ, and why your cost spreadsheet is wrong

Brazil's labor system has a logic of its own, and it pays to understand it before building the budget:

• CLT (Consolidação das Leis do Trabalho, Brazil's formal employment regime) is classic registered employment, with rights and costs that don't exist in the same form in your country: on top of the monthly salary there is a 13th salary, paid vacation with an additional one-third bonus, a severance fund (FGTS) of 8% that the company deposits every month, and charges that vary with the company's tax regime (the 20% employer INSS contribution, for example, applies under some regimes and not others). The math from Contabilizei, one of Brazil's largest online accounting firms, gives you the scale: the total cost of a CLT employee starts at around 1.6x the nominal salary depending on the regime, and with a full benefits package it can climb quite a bit higher (2025). Budgeting with the "bare" salary is the number one mistake among companies that arrive.
• PJ (pessoa jurídica, contractor-style hiring) means engaging the person as a vendor: they invoice through their own company. It's common in tech and senior roles, simpler and lower in total cost, but it has real legal limits: if the relationship works like disguised employment (fixed hours, subordination, exclusivity), the labor risk is real. It's not a universal shortcut; it's a structure for the cases where it genuinely fits.
• The right order is to define who you need first and then, with local accounting and legal advice, the hiring structure. Companies that choose the structure first end up hiring what was convenient, not what they needed.

What Brazilian candidates value (and you might not expect)

A few cultural differences we see consistently in our searches:

1. Stability carries weight, and even more among the young. Formal CLT employment with benefits has strong symbolic value: according to a Serasa Experian survey, 78.7% of Brazilians looking for work prefer the CLT regime over PJ contracting, and among Gen Z the preference climbs to 92.6% (2026). Against the intuition of a founder used to building teams with contractors, here it's the other way around: a foreign startup offering PJ without benefits competes at a disadvantage against the established local company. You can compensate with project, salary or flexibility, but you need to know it before shaping the offer.
2. Benefits are part of the language. Vale-refeição (meal allowance), plano de saúde (health plan), vale-transporte (commuting allowance): the benefits package is a cultural standard. Its absence is noticed far more than a foreign HQ imagines.
3. The relationship before the transaction. The Brazilian work style takes great care of the bond and the harmony; feedback that is too direct (the Rioplatense style we grew up with, for instance) can read as aggressive. This matters from the first interview: the candidate is also deciding whether they want to work with you.
4. São Paulo is not all of Brazil, but for an expansion it's almost always the starting point: the Abstartups and Deloitte mapping places 40.7% of the country's startups in the state of São Paulo (2024), and that's also where business talent and corporate clients concentrate. Decisions like "we'll hire remote in any state" carry cost and time-zone consequences worth thinking through.

One more data point to calibrate expectations: hiring in Brazil is not easier than hiring at home. 81% of Brazilian employers report difficulty finding the talent they need, against a global average of 74% (ManpowerGroup, 2025). You will be competing for scarce talent against local companies that know this game by heart.

The most expensive mistake: hiring the first person without a method

The first hire in Brazil usually happens in a rush and through referrals: an investor's acquaintance, the candidate who speaks your language and "seems like a fit". Sometimes it works out. When it goes wrong, the company loses between six months and a year of its expansion, which in a competitive market is extremely expensive. Your first Brazilian employee deserves the most serious process of all: a profile mapped with the HQ, an active search in the local market, interviews in Portuguese by people who know how to evaluate, and a shortlist to compare instead of a single inevitable candidate.

Our place in this story

BYS recruits talent in Brazil for companies based abroad: we map the profile with your team in your language, we search and interview candidates in Portuguese in the local market, and we present you an evaluated shortlist with the cultural context translated. We are Argentine, we lived the landing in Brazil first-hand, and we operate from São Paulo. The bridge your expansion needs is exactly the one we crossed ourselves.

Is your company entering Brazil? Write to us before the first hire. A 30-minute conversation about the market you're about to find can save you the founding mistake.