Software
Nearshore software development from Brazil: a practical guide for US startups
Brazil shares most of the US working day, has a large technology workforce and a long history of serving international clients. Here is what US founders should know before hiring a team there.
By Wendel Fernandes de LanaFounder, MagzPublished 5 min readIn short
- Brazil's main technology hubs run on Brasília time (UTC−3) all year, one to two hours ahead of New York and four to five hours ahead of San Francisco.
- Choose the model that fits your stage: a freelancer for a small, defined task, a consultancy for a product you want delivered and documented, staff augmentation or an employer of record for a long term team.
- Protect yourself with the basics: code in your own repository, IP assignment and confidentiality in the contract, agreed overlap hours and a small paid trial before a long commitment.
On this page
Why US startups look at Brazil
Three things put Brazil on the shortlist for nearshore development. The time zone sits close to the US working day, so teams can meet and ship together without overnight handovers. The country has one of the largest technology workforces in Latin America, with strong universities and active startup communities in cities such as São Paulo, Florianópolis, Belo Horizonte and Recife. And many Brazilian developers already work in English with clients in North America and Europe.
It is not the cheapest option in every case, and it is not the right fit for every team. The rest of this guide covers what to check so you can decide for yourself.
Time zone overlap
At the time of writing, Brazil has not used daylight saving time since 2019, and its main technology hubs keep Brasília time, UTC−3, all year. The gap with the US therefore changes when US clocks change.
| City | US summer (daylight time) | US winter (standard time) |
|---|---|---|
| New York | 1 hour | 2 hours |
| Chicago | 2 hours | 3 hours |
| Denver | 3 hours | 4 hours |
| San Francisco | 4 hours | 5 hours |
In practice, a standard São Paulo working day covers most of the New York day and about half of the San Francisco day. Agree core overlap hours in writing, for example four hours a day for meetings and reviews, and plan focused work around them.
Engagement models
| Model | What it is | Best for | Watch out for |
|---|---|---|---|
| Freelancer | An individual contractor you hire directly | Small, well defined tasks | Availability, continuity and a single point of failure |
| Consultancy or agency | A company that scopes, builds and documents the work | A product or project you want delivered, with advice included | Who actually does the work, and how knowledge is handed over |
| Staff augmentation | Developers supplied by a vendor to work inside your team | Adding capacity to a team you already lead | You still need someone to direct the work |
| Employer of record | A third party employs people in Brazil on your behalf | Building a long term team of your own | Local employment rules, total cost and notice periods |
Magz works as a consultancy: we scope the work, build it, document it and hand it over, and we can also act as your fractional CTO while your own team grows.
Contracts and data protection
A few clauses matter more than the rest. Ask a lawyer who knows cross border work to review the final version, and make sure these points are covered:
- Intellectual property: the contract assigns all code, designs and documents created for you to your company, including work done by any subcontractors, with a licence to any tools the vendor already owned.
- Confidentiality: a clear obligation that continues after the contract ends.
- Data protection: Brazil's data protection law, the LGPD, applies to personal data processed in Brazil, alongside any US or European rules you already follow. Agree how customer data is accessed, stored and deleted.
- Hours and response times: the overlap window, the meeting rhythm and how quickly urgent issues are handled.
- Payment: currency, invoicing schedule and method. Many Brazilian companies invoice international clients in US dollars.
- Notice and handover: how either side can end the agreement and what must be delivered when it does.
What drives the cost
Rates vary widely, so compare what each proposal includes rather than hourly figures alone. The main drivers are:
- Seniority. Senior engineers cost more per hour and often less per result.
- Model. Consultancies include planning, coordination and documentation in their price; freelancers usually do not.
- English level. Fluent communication is in demand and priced accordingly.
- Commitment. Longer, predictable engagements usually get better terms than short, urgent ones.
- Currency. A price set in US dollars protects your budget from exchange rate swings; a price set in reais does not.
Seven checks before you sign
- Meet the people who will do the work, not only the sales contact.
- Test communication in a real working session, in English, with your team.
- Start with a small paid trial of two to four weeks before a long commitment.
- Keep code, cloud accounts and documents in your company's name from day one.
- Agree overlap hours and response times in writing.
- Plan around holidays. Brazil has its own national holidays, and Carnival in February or March affects availability in many cities.
- Ask how knowledge is documented, and what a handover would look like if you part ways.
A note on bias
Magz is a Brazil based consultancy, so we have an interest in this topic. We have tried to write the guide we would want to read before hiring any provider, including one of our competitors.
If you are planning a product build, our software development page explains how Magz scopes, builds and hands over projects for clients abroad.
Planning a build with a team in Brazil?
Magz works in English with clients abroad, with hours that overlap the US working day. Tell us about your product and we will suggest a sensible way to start.
About the author
Wendel Fernandes de Lana
Founder, Magz
Wendel Fernandes de Lana is the founder of Magz. He holds a Bachelor of Information Systems from the University of São Paulo, completed a summer executive course in digital business at California State University, Northridge, and has worked on web development, CRM automation and Apache AGE, the open source graph extension for PostgreSQL.