The Digital Nomad Visa: a solution to Thailand’s startup woes?

Chiang Mai is a magnet for digital nomads but there are visa issues for online entrepreneurs. Is a digital nomad visa the answer?

By | Fri 29 Nov 2019

Chiang Mai’s digital future. Where it’s going, what’s holding it back, and what happens when the government’s left hand doesn’t speak to its right.

It’s the laptops. They’re everywhere. Never before have work and life been so mobile, and Chiang Mai is home to the leading edge of this movement. You’d have to avoid the city centre and Nimmanhaemin entirely to ignore the fact it’s been steadily colonised by the remote workers and online entrepreneurs who’ve come to be known as digital nomads.

Perhaps you’re new to this trend, wondering why you’re gazing upon a sea of Apple and Huawei logos radiating at you after you placed your latte order. Or maybe you’ve been in the know – one of the many business owners shifting gears to accommodate this new class of traveller by advertising your space as ‘coworking’ or cashing in on a month-to-month rate on your condo.Tethered to nothing but their laptops and wifi, these digital nomads represent the future of work. A freedom of movement and opportunity enabled by technological gains, a globally connected economy, a strong passport, and rejection of the status quo in their home countries.
It’s this same knowledge economy and global opportunity that Thailand is investing so heavily in creating for its own citizens. With bodies like the National Innovation Agency (NIA), Startup Thailand, and the Digital Economic Promotion Agency (DEPA) hosting laser-filled tech conferences and every major corporate creating its own venture capital arm, the nation is sending a strong message to the world that it is open for tech business and we’re taking Thailand 4.0 seriously.

While the activity and funding is mostly centered in Bangkok, Chiang Mai is seeing its fair share of buzz. We’re now the proud home of the shiny new Northern Science and Technology Park. Part startup incubator, part coworking and part event space (they played host to this year’s highly attended TEDx) this campus aims to be the home and hub of the city’s startup classes. Our fair home has also been granted the designation of Smart City. While we’ve yet to see any ribbons cut, a three million baht coffer has been set aside to pilot urban development projects that leverage IT and technology to promote sustainability, tourism, and quality of life.
Then we’ve got Chiangmai&co, a public private venture spearheaded by one of the investors behind Punspace, the city’s best known coworking brand. Providing business services to startups and tech teams, they’re channelling resources from the national level and promoting networks and mentorship. A recent pitching event brought venture capitalists and investors up from Bangkok to meet with the city’s brightest. “Our goal is to create more visibility for local startups and we’re launching a platform to make finding and browsing them more efficient,” says Kittichai Phiphatbunyarat, founder of Chiangmai&co. “We’re also finding more angel investors, something we’ve identified as a missing piece within the ecosystem. And last but not least, we’re collaborating with Thailand Board of Investment (BOI) and NIA to improve the SMART Visa programme.” If you stick to reading the tech publications, it would seem we’re on the brink of a technological and economic revolution. On the ground though, a reality check is in order. The potential for transforming Chiang Mai’s economy by digitising and automating businesses and exploring innovative new solutions is, of course, immense. But at the moment it’s just that, potential.

The few startup darlings we’ve created so far like Horganize, an app connecting landlords and tenants, or BeNeat, the popular maid booking platform, have serious national potential. When it comes to taking over the region or going global though, our hometown heroes might not be ready for the big leagues just yet. “One thing that prevents local startups from going global is their English. They might do well at Thai pitching contests, but then they can’t compete abroad. In that way, Chiang Mai is not international enough,” comments Cholathit Khuenkaew, founder of startup consultancy Artisan Digital and a local ecosystem connector. “We also have the problem that our ecosystem is new and it’s not easy to hire developers with experience in scaling or to find senior level managers.” Remember those digital nomads and their laptops? Surely the solution to the latter two issues sit right in front of us. The city is already home to a population of tech-savvy individuals with the skills and experience to fill gaps in our nascent tech ecosystem. When it comes to foreigners living and working in Thailand, however, things are seldom simple.

Chiang Mai came on the radar for digital nomads at the start of this global trend thanks to our many cultural and natural assets, the low cost of living, and a generous multiple-entry tourist visa. While the city still offers excellent quality of life, the rising strength of the baht coupled with the PR disaster that is haze season and ever-more visa crackdowns threaten to put an end to this windfall of talent. It’s the latter issue which is so baffling. On the one hand you have tremendous amounts of capital being sunk into developing a startup ecosystem and promoting a digital economy. On the other hand you have an immigration department that keeps moving the goalposts, preventing digital nomads from making Thailand, their country of choice, a home-base from which to do business.

Take Sarah, a French web developer who’s been volunteering her time teaching newbie nomads and local business owners how to create and manage their websites: “I went to Vietnam for my visa run and when I tried to come back, I was rejected at the border. I didn’t know what to do. My apartment, my friends, and my community I created were all in Chiang Mai. What would happen if I couldn’t go back?” Fortunately for Sarah, applying for a visa at another embassy was enough to get her back in, but she says that at the end of this visa she will probably move away because Thailand is not a reliable base for her travels. Then there’s Brianne the American HR consultant: “I consider Chiang Mai my home and I spend a few months every year here. Because I travel a lot for my work and I always apply for visas ahead of time, I’ve never had a problem. Last time I was at the Thai embassy in London though, they told me that the rules had changed and if I wanted a multiple-entry tourist visa I would have to fly back to the US, something I didn’t have the time or the budget for. I’m happy to follow the rules, but when they change without warning, it’s very stressful.”

All of this happens at a time when neighbours like Malaysia launch a digital freelancer visa and Vietnam hacks away at business regulations and immigration red tape, all in attempts to lure this very same talent Thailand is so callously closing its doors to. With their “good guys in, bad guys out” mantra, it seems baffling that Immigration would have it out for these highly skilled workers earning their dollars abroad to spend in Thailand. Unfortunately this seems a classic issue of Thai bureaucracy where agencies exist in silos, each with their own mandates and little interest in serving agendas outside of their own, no matter the conflicts or backlash.
“To pin Chiang Mai as a home for skilled tech talent and entrepreneurs, we need to improve the visa situation. Frankly, many foreigners still face frustrating experiences with visas and work-permits and we were slower than we expected in facilitating this,” adds Kittichai. “However, with our collaboration with BOI and NIA we hope to streamline this and make Chiangmai&Co a service centre for
welcoming foreign talent.”

The organisation I help lead, the Chiang Mai Entrepreneurship Association (CMEA), is also stepping in to address this issue. Alarmed by the disappearance of our members and the stories we’ve heard, we decided to collaborate with Chiang Mai University’s Faculty of Economics to undertake a study on the Economic Impact of Digital Nomads in Chiang Mai.

We need real data to create policies that work and there are many misconceptions about who digital nomads are and what value they offer. A search on Youtube finds a whole trove of videos boasting about how to live in Chiang Mai for a pittance, so there’s a widespread belief that nomads are just backpackers with laptops. In our experience, the reality is very different, and the data we’ve gathered back this up.

According to initial survey results, 73.9% of digital nomads in Chiang Mai have a Bachelor’s degree or higher and 56.9% of have at least 11 years professional experience. 40.1% of respondents earn between 50,000 baht to 100,000 baht a month, and 37.8% earn between 100,000 baht to 500,000 baht per month while 4.1% boast earnings of more than 500,000 baht per month. In terms of employment and skills, the greatest percentages work in Software and Web Development (17.3%) followed by Marketing (13.7%), and the Business, Financial or Legal Professions (11.9%). Close behind, online English teachers account for another 9.7%. On average, digital nomads have spent 26,000 baht on visa services in the last 18 months. They have spent a whopping extra 39,000 baht on top of that number on the many visa runs required. And all for a visa that explicitly forbids them from legally working here, employing or being employed by Thais. [1] Most digital nomads enter the country with a tourist visa, but education visas are the most popular option for those trying to stay for longer periods. What could we do if this revenue was lining, not the pockets of the language and martial arts schools that facilitate education visas, but the government’s coffers? One hopes that could be revenue to fund overburdened administrators trying to keep up with the slew of new initiatives and legislation shooting down from the capital.

The powers that be would do well to take note that 72% of survey respondents said they would be happy to pay taxes in Thailand in exchange for a suitable visa. [2] “I’m sick of the visa runs. I’m sick of doing the dance with immigration. I have a good life here and I would love to take on Thai clients and help local businesses. I would be happy to hire Thais or volunteer my time, but that’s all illegal for me to do. I just don’t understand why it has to be so hard,” says Christian, a developer from Canada. Chiang Mai’s population of digital nomads live in uneasy limbo not knowing if the next visa run means saying goodbye to the life they’ve built here and wondering if it’s time to start searching for greener pastures. Meanwhile local startups complain about the difficulty of hiring when the most talented graduates head to Bangkok or overseas, and government agencies wonder how they’ll reach ambitious targets when there’s simply not enough new companies forming, much less making it through the rigorous gauntlet of business development. The laptops are hooked up to the same wifi and they’re rubbing elbows in the city’s endless cafes and coworking spaces, but will they ever get to connect and help Chiang Mai to live up to its potential? Seems like an awful waste if they don’t. Some names have been changed to protect the anonymity of sources.

Lily Bruns is a Board Member of the Chiang Mai Entrepreneurship and the founder of CoCo Chiang Mai, a booking platform for digital nomads. A hometown girl, she’s a passionate ecosystem connector and works to bring together public and private interests that can help Chiang Mai to flourish.