The burning issue of talent shortage and rising costs are pushing many businesses to seek alternative solutions for software development to stay competitive. IT outsourcing to Latin America, especially Mexico, has become a popular choice for American companies. Why is it so?
In this article, we’ll explore the rapid development of the Mexican tech industry, highlight key players in the IT services sector, and provide tips for selecting the best software development company in Mexico. Additionally, we’ll reveal a cost-efficient alternative to IT outsourcing, enabling tech businesses to hire software engineers in Mexico with 100% compliance.
Current State of Tech Industry in Mexico
The Mexican tech market is the second-largest in Latin America, only trailing behind Brazil. Its valuation has seen an impressive surge from $22 billion in 2020 to $28 billion in 2022, showing no signs of slowing down. According to Mordor Intelligence forecast, the IT industry in Mexico will see a CAGR of 10.6% over the next 5 years, largely influenced by the proliferation of 5G technology, fintech, AI, blockchain, etc. Let’s look at them in more detail.
Fintech
- Between 2019 and 2023, the fintech industry in Mexico grew at an annual rate of 18.4%, becoming the second-largest fintech ecosystem in Latin America, with over 20% of all fintech companies in the region.
- In 2023, the Mexican fintech market boasted 773 local startups, showing an 18.9% increase from the previous year. Bitso, Konfio, Stori, Clic, and Clara are among the top fintech startup companies.
- Except for the local startups, Mexico’s fintech ecosystem boasts around 217 foreign startups from more than 22 countries, with the most significant share in the USA (25.8%), Chile (20.3%), Colombia (16.1%), and Argentina (13.4%).
- A significant leap in the development of Mexico’s fintech industry was the adoption of the Law on the Regulation of Financial Technology Institutions. It establishes authorization requirements, information security measures, and transparency standards to protect consumers and maintain financial stability.
Artificial Intelligence
- The AI market volume in Mexico will reach $2.8 billion in 2024 and is expected to grow at a CAGR of 28.5%.
- There are 214 AI startups in the country, with the prominent ones being Yana, Kolors, Pulsar, and Apli, primarily residing in Mexico City.
- Mexico’s AI sector is rapidly developing in Generative AI, robotics, ML, NLP, and Computer Vision.
- With the National AI strategy in force, 81% of Mexican companies have or plan to benefit from AI, with the intent to keep investing in this technology, adding at least $1.5 billion in 2024.
Crypto & Blockchain
- In the top 20 of the Global Crypto Adoption Index, Mexico’s crypto sector revenue is expected to reach $1,4 million in 2024, further growing at a CAGR of 8.53%.
- Ranking 1st in Central America for the startup ecosystem, Mexico boasts remarkable crypto and blockchain startups such as Bitso, Vivaion, Mifiel, and SpeiBit.
- 40% of Mexican companies are actively exploring blockchain and cryptocurrencies, with 71% focused on cryptocurrency usage.
Mexico already ranks 3rd in LATAM with the most innovative economy in the tech sector, with outstanding indicators in business sophistication, knowledge and technology outputs, and human capital and research. Mexico City, Guadalajara, and Monterrey are the prominent contributors to the country’s GDP and exports, bringing Mexico to the top 3 largest IT services exporters.
The IT outsourcing sector in Mexico has been growing at an impressive 10%-15% annually. The largest revenue share in the Mexican technology industry comes from enterprise software, with $1.5 million in 2022. Over 400 software development companies in Mexico predominantly specialize in customer software development, IT strategy consulting, tech-managed services, mobile and web development, and cloud consulting.
5 Best Software Development Companies in Mexico
If your tech company operates outside of the tech industry or has a small side project, you can consider one of the following best software development companies in Mexico.
- Teravision Technologies is among the leading nearshore software development companies in Mexico. They specialize in custom software development, mobile app development, and AI development & consulting. Founded in 2002, the company has a strong presence in Mexico. Strategic geographical location allows them to offer nearshore outsourcing services to North American businesses in fintech, e-commerce, and healthcare industries.
- Rootstack is another prominent software development firm in Mexico, according to Clutch. Its expertise spans several areas, including e-commerce, custom software, and API development. Among their clients are companies from the USA, Canada, and LATAM, boasting an overall 350 completed IT outsourcing projects.
- Ancient Tech is one more star in software development in Mexico. Established in 2014, the company specializes in custom software development, AI, web and mobile app development as well as BI & Big Data consulting. Ancient Tech primarily focuses on small and medium-sized businesses, operating in financial services, healthcare, and telecommunications.
- Unosquare is one of the best software development companies in Mexico that is on its mission to enhance businesses' IT engineering capabilities. With over 1,000 employees across five countries, including Mexico, Unosquare is well-equipped to handle various outsourcing projects, focusing predominantly on custom software development, web development, app testing, and UX/UI design. With offices in Guadalajara, León, and Aguascalientes, the company is an optimal fit for nearshore outsourcing solutions offered to North American businesses.
- SISU Technologies is among the top software development firms in Mexico. Founded in 2013, they are located in Mexico City and specialize in creating digital solutions with a strong focus on usability, design, and return on investment. SISU delivers a wide range of services, including custom software development, web development, IT strategy consulting, and mobile app development.
How to Choose a Software Development Company in Mexico in 2025
That’s a good question. There are several factors you need to bear in mind when choosing the optimal software development company in Mexico for cooperation.
- Experience. When scrolling over the dozens of software development firms in Mexico, pay attention to their track record. Experienced companies usually share quite a few case studies, which can tell you how to embrace cooperation and strategies to achieve great results. Don’t forget to check their portfolio for similar projects to know that the company has previous experience completing a similar task.
- Technical expertise. Ensure the company’s development team is skilled in the technologies and frameworks you require for your project. AI, blockchain, IoT, and cloud solutions might be the ones that will come in handy for your software development.
- Reputation. Take some time to research client testimonials and reviews on independent platforms such as Clutch, G2, or GoodFirms. Reliable software development companies in Mexico should have positive feedback, showcasing their expertise and professionalism.
- Pricing. Even though it’s pretty hard to avoid hidden fees when using IT services from outsourcing providers, you can still try to minimize the risk. Check if they work on the pay-as-you-go approach or have set service fees.
- Guarantees. An outsourcing vendor that performs software development in Mexico can ensure more or less transparent pricing and reliability by having guarantees. It could be connected to cost reimbursement or adherence to definite timeframes.
- Communication & cultural fit. Clear and prompt communication is key to fruitful cooperation. Thus, when looking for a software development company in Mexico, identify if they have an outlined process for project management, tools, and tech to track progress and online means to share regular updates and make speedy adjustments. Solid English proficiency and Western business ethics are a big plus to a productive partnership.
Viable Alternative to Software Development Outsourcing in Mexico
IT outsourcing is not the only way to perform your software development in Mexico. In reality, you can avoid common pitfalls and risks associated with traditional outsourcing and outstaffing models by building your team of developers. So, how to do that?
Alcor’s Software R&D Centre is an all-in-one solution for tech companies exploring team scaling opportunities for product development and business growth. It includes full-cycle tech recruitment, EoR services, and operational support — everything to build a software engineering team from scratch. The company operates in Latin America and Eastern Europe and guarantees:
- Access to 10% of the Valley-caliber senior talent;
- High-quality software developers with an average tenure of 2.5 years;
- 100% compliant employment with no need for legal entity establishment;
- Zero buy-out fees, clients can source developers anytime for free;
- 40% cost reduction in comparison with outsourcing/ outstaffing;
- Full integration, as engineers are clients from day one.
Final Thoughts
Mexico’s tech industry is emerging as a key player in Latin America, ranking as the second largest in the region. With the impressive development of AI, fintech, blockchain, and other innovation sectors, the country’s tech market is poised for continued expansion. The IT outsourcing sector is booming, supported by over 400 firms offering diverse services.
Businesses that consider nearshoring can choose from a variety of software development companies in Mexico, with a focus on tech expertise, track record, and client reviews to make an optimal pick. Meanwhile, tech companies looking to expand their development teams can benefit from a comprehensive software R&D centre solution.
