Global PEOs – The Growth Hack for Canadian Start-ups

May 4, 2022
Global PEOs - The Growth Hack for Canadian Start-ups

More and more businesses nowadays decide to go global. When done correctly, international expansion brings many financial benefits, especially as your business takes advantage of new markets and new sources of revenue. If you want to expand overseas and reap the benefits of emerging markets the following will introduce you to a method of doing business overseas while saving time and money.

Why Are Canadian Startups Expanding Globally?

As developing economies gain traction, many businesses around the world strengthen their market position by expanding globally. There are more and more opportunities in these new markets, and some of the main ones are explored below.

New Markets and New Clients

This is one of the main incentives to expand globally. Businesses choose to go global to obtain more revenues – whether it is through the same product or service as in the domestic market or testing a new one. This way, businesses obtain more market share and consolidate the revenue streams.

New Talent Acquisition

When expanding to a new country, you obtain access to the local workforce. This can be a strong advantage especially if your business has difficulties hiring in Canada. Apart from this, foreign talent can consolidate your team through their new skill set and thorough understanding of the local demand and customer behavior.

Cost Efficiency

There’s also a financial incentive to expand overseas. International businesses can access local financing, obtain tax deductions, and access cheaper labor. Companies that expand internationally can decrease operational costs. For instance, many manufacturing businesses have found that moving some of their operations to other countries improved performance due to more affordable talent.

How Businesses Can Expand Overseas

There are many legal and statutory aspects to be considered when expanding abroad. Essentially, there are two main ways of scaling your business. First, businesses can set up a legal entity in a foreign country and manage the whole employment process. This can be time-consuming and expensive because foreign entities require high capital that varies based on the country, industry, and other licenses or permits requested by law.

Also, setting up a foreign entity may be a very lengthy process that needs ample management of resources and a thorough knowledge of all the local employment laws and regulations. Taxation, corporate set-up, and other considerations are very important because uncompliant businesses can suffer great damage – both financially and reputational.

Fortunately, there is a quicker and cheaper way of expanding overseas. Start-ups in Canada that want to hire global talent don’t have to set up foreign entities to be able to do so. Global PEOs, or Professional Employer Organizations, provide all the services required to help businesses hire globally. These organizations employ and manage the employees on your company’s behalf, while the employee is assigned to your company. All the payroll, taxation, and responsibility to follow all the local laws and regulations are handled by the PEO.

Benefits of Using a PEO

A Canadian start-up looking to hire a country manager in Shanghai or Beijing for example, can make use of a specialist Chinese professional employment organization to reduce the costs and risks associated with setting up foreign entities. These organizations will handle the entire process, from managing employee payroll contributions, taxations, and benefits to termination of contracts. This means that your business has more time and resources to focus on important aspects that generate income.

When you opt for a global PEO, sometimes knows as an EOR (employer of record), you obtain access to the global job market at a fraction of the costs and time required to expand via a local entity. A PEO manages every requirement necessary as an employer, from ensuring compliance with local laws and regulations to onboarding employees, handling payroll contributions, benefits, and others, so that the business only needs to direct the foreign employees on their daily tasks, while the PEO covers the rest of the process.

A global PEO is an opportunity for businesses of all sizes to tap into the global workforce without tying up capital. For instance, a small business may lack the financial resources and the expertise required to open a local entity. A PEO can handle the process of employment on its behalf while setting a fixed fee per employee. This does not only save time and money but also allows for better budgeting and planning.

For larger organizations, the PEO can supplement the in-house HR department and facilitate the employment process. Also, using PEO services allow larger businesses to test the market and decide whether setting up a local entity is worth the costs and effort.


You can hire and expand overseas via 2 main methods. Setting up a foreign entity can be a very lengthy and expensive process though, using a global PEO service is a much simpler way that allows organizations to tap into new markets with minimal risks and costs.

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