3Sixty Insights #HRTechChat with Bob Cahill, CEO of Globalization Partners

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Bob Cahill got his start at Ernst & Young. “And I was fascinated by the power of software and technology to expand your market or make you efficient in your operations,” he said as our guest on this episode of #HRTechChat video podcast. Over the approximately 25 years that have passed, Bob served as a C-suite executive for several technology companies, and a big part of his focus has always been on international challenges, “where I found a lot of passion to scale technology globally,” he said. “It was sort of the perfect juncture with meeting Nicole Sahin,” the founder of Globalization Partners, where Bob later became CEO. “She had this better mousetrap idea.”

Traditionally, companies that wanted to expand internationally would have to follow a very conventional process. The first step would be to set up a new entity and get a payroll registration so they could hire people. Then, they’d have to ensure regulatory compliance would be outsourced to an array of advisors. “Nicole’s vision was, ‘Why do I keep doing this over and over again?’,” Bob noted.

Thus was born, about 10 years ago, Nicole’s vision for an employer-of-record (EOR). A company that needs to stand up its ability to employ people in a country new to its operations can turn to an EOR to do all the heavy lifting. The EOR’s very business is to set up these entities in any country needed to become the globally expanding employer’s single point for all things there related to employment. The EOR assumes this risk and takes on solving for all the complexity involved.

As a pioneer in the space, Globalization-Partners has trailblazed best-practices to overcome resistance to the idea of an EOR. This resistance is waning considerably as EORs have flourished to gain acceptance in recent years. The welcoming has come not only from the typical growing global organization, but also from employers clamoring to establish borderless workforces and vie for talent in pursuit of the emerging work-from-anywhere approach to talent acquisition and retention.

This is the future-of-work angle, and it’s worth noting that nearly one-quarter of CFOs are concerned over talent shortages, according to Globalization Partners’ 2022 Globalization Trends Survey. Perhaps more compelling, 83 percent of CFOs believe “their long-term plans will stem around expansion into new countries,” the related press release notes.

It’s a number slightly higher than last year’s, and the report is rich with insight into the sentiments and objectives of CFOs vis-à-vis EOR. As additional context for our conversation, Bob and I touched a bit on the findings overall. We also explored the company’s philosophy when it comes to workforce inclusivity and blending service and technology for EOR, as well as Nicole’s vision for the years ahead in EOR now that she is executive chair of Globalization Partners. I highly recommend viewing this episode.

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Transcript:

Brent Skinner 00:00
Well, hello, everyone, and welcome to this the latest episode of the HRTechChat video podcast. And we are very excited to have as our guest today, Bob Cahill, who is CEO of Globalization Partners, welcome, Bob.

Bob Cahill 00:17
Thank you, Brent, through a pleasure to be with you today.

Brent Skinner 00:19
Yeah, absolutely. The pleasure is all it’s all mine. This is going to be a very interesting podcast episode, I think we’re going to talk about what globalization partners does, in around the employee, employer of record model. And I’ll get into that technology for it and how you’re a pioneer in it and, and how it fits in the future of work and expansion for organizations, all these sorts of things. But um, maybe we could start with, you know, what is your career path? What led you to globalization partners, what, what are the origins of globalization partners, what, what is, what is it that really animates you about this, about this role that you’re in?

Bob Cahill 01:09
Great, I’ll try to get all those in one fell swoop here. I am a born and raised Bostonian. And I started my career with Ernst and Young, you know, classic audit or trail sort of CPA path. But one of my early clients was a was a technology company. And I was fascinated by it amongst all of the different industries that I was working, working with, about what the power of software and technology and how it can, you know, to your expand your market or make your efficient in your operations, it just, it was fascinating to me. And so I knew then, that that’s where I wanted to take my career. And it was since then, you know, past 25 years or so, I’ve been a C suite executive at a number of, you know, bought, typically Boston based technology companies. But generally with a big focus on international, where I found a lot of passion, that that I could bring that in technology, and the ability to, you know, to scale technology globally, was very fascinating to me. So that was sort of the perfect, you know, juncture with meeting the closer he and the founder of globalization partners, about four and a half years ago, and she had this really a better mousetrap idea around companies that typically for her US companies that wanted to expand internationally would follow a very traditional process of, I must set up a new entity and get a payroll registration, and then I can hire people. And then compliance needs to be outsourced to all these different advisors. And her vision was, Why do I keep doing this over and over again? If you Why can we set up one entity in a country and leverage that single point to allow your many businesses, leverage scale technology, you know, benefits, payroll, things like that, as a single point of solution, and so that that was the kernel of her idea, about 10 years ago. And so, and I was fascinated by the fact that this could happen, that the pain that it would relieve any company that wanted to expand rapidly on a global basis without going through all that rigor by themselves.

Brent Skinner 03:27
Sorry, I didn’t mean to interrupt. But it’s super interesting, right? Because there’s a lot of, of obstacles real and in potential actual and potential to an organization expanding rapidly into a new country and into this is probably a good segue into helping our viewers really understand what an employer of record is. It’s a relatively newer concept. I know that. And but it’s just in a nutshell, it’s a way for organizations to expand rapidly into new countries where maybe they don’t want us Oh, let you do this. But the lifting here,

Bob Cahill 04:08
yeah, no, not at all. Yeah, I mean, we think about companies that do want to expand and frequently as technology companies, they found there, they found their product market fit they have there’s getting scale in usually the domestic market and want to take that technology that service, that product to market in another country. And that really wants to be there. They want to focus on going to market they want to focus on delivering a good experience to customers, and the overheads, that comes with expanding internationally and hiring international employees is significant and it’s time consuming, and it takes a long time. And it’s everything from entity setup to banking to employment law, which is a huge one. And it’s a very, very different country by country. So how do I hire people? compliantly What benefits do I bring them? What are the compliance issues I need to understand? And then you do that country by country? Free and our most successful customers are doing this across multiple countries. And each individual country as a whole is like starting over. So we’ve established entities all over the world have established the benefits, the banking, the compliance, and so our customers can simply come in and say, Okay, well, you’re I’m ready to go, all I’ll do is just bring on the talents, and we take care of everything else, all through all through our technology stack. So really end to end, they can do this through an automated way. So that and that gives us high scalability on a global basis. That’s really what EMR is, it’s employee of record. And the key thing that the and the reason that title is used is that we are legally GP or any employer of record is legal, the employer is the employer. So all the liability for that employee and compliantly is have on us. And so and so while our customers certainly control the day to day of what the employee does, from a legal perspective, they are employed by the employer of record, hence the name.

Brent Skinner 06:00
No, I have a question here. Like, say, for instance, the paycheck? Where does it say it comes from? does is it um, is that it’s a great question can be white labeled, if it can an EOR be white labeled?

Bob Cahill 06:15
It? Well, it possibly could be, but it would actually defeat the purpose here, I think, ultimately, we their paycheck will say, in our case, is a US customer going to the Czech Republic, it’ll say, you know, globalization partners, Czech Republic, or whatever our legal entity name is, and that that’s a, that’s a benefit to that, because they really understand who their employer is. And just as important, the government in the Czech Republic understands who the employer is. And we work closely with governments around the world, and they really love the model, because we’re doing everything very compliantly we’re paying into this, we’re paying all of our social taxes, as well as our income taxes in jurisdiction, we’re very transparent what we’re doing. And so for the government, they love it, because we’re employing in their country, and we’re doing so transparently and compliantly. So it’s a win for both that local employee and for the government.

Brent Skinner 07:05
Yeah, yeah. How? How does technology factor into this? To what extent is globalization partners providing the technology? How much does it interface with? To what extent if any, with the with the, that the client companies technology? How does that all work?

Bob Cahill 07:26
Absolutely. So you we have a saying sort of like it basically is technology when you need it. And humans if you if you want, if you need it or want it need it, you can experience an entire end and employee lifecycle without ever talking to a human, if you wish, we have it you can come in, you can register you can bring you there’s a whole user interface that allows you to employ the person that you you choose to employ, we have recruiting module, you need help doing that, we bring them on board, we have something we actually the contract that’s generated for that employees local, localized for all local employment laws. So we actually help our customers avoid any problems by offering things or saying things based on their knowledge of their local laws versus the laws that are applicable in that country around compliance benefits, things of that nature, statutory taxes. So that’s all done online. And that’s all we’ve had 10 years of knowledge that’s all built into our AI engine that helps generate all that. And so you can employ all the contracts are digital, and they’re ready to go. And so really, and then any managing, you know, commissions or payroll or changes in benefits, either from the professional or from our customer, it can all be done on the platform. So it’s a portal bidirectional portal that allows the entire lifecycle to be managed. And so essentially, the only piece that the customer needs to worry about is they usually give their professional an email address back at the company, as opposed to GP so that we can manage the day to day. Otherwise, that’s it, it goes end to end. So that’s, that’s first and foremost, the technology platform allows for that. However, we do have a lot of we’re very strong in that we have open API’s and API’s with a lot of the major HCM companies, the ERP companies and the domestic PEO companies, which allows you know, the HR departments and I’ll give the example of a US company, they may have ADP as their payroll provider or their PEO, but they also have a check Republican professional on our platform. With the integrations with ADP they can get a single view of what’s going on and when their entire workforce.

Brent Skinner 09:38
Okay, okay, that’s interesting. So help me understand the payroll piece a little bit more. So in your technology stack, globalization partners, there is a payroll component.

Bob Cahill 09:50
Absolutely. So we are responsible and it’s one of the things that we provide is we’re responsible for making payroll every month for their for their employees, they have no other negation that there are employees, if they don’t get paid, if someone was not to get paid, that’s our, that’s our responsibility. And that’s a regardless of whether, you know, whether a customer pays us or not. That’s our responsibility. And we take that very seriously. And obviously, you know, 100% Payable, timeliness and accuracy is extremely important to professionalist just like it is to you and I making sure we get paid every week. So that that is part of the offering, it’s one little piece, it’s not the piece, that’s the real value, add it and put it but doing so compliantly and timely, and make sure that that money is landing in the proper bank accounts or digital wallets is part of the overall offering.

Brent Skinner 10:38
Okay, okay. Very interesting. We have this, this is a slight tangent for a moment, here we have this concept that we talked about here 3Sixty Insights that HCM is, is concrete and abstract, they’re constrained concrete elements to it and abstract elements. Concrete being, you know, sort of the, calculations or the or the maybe the administrative work related to I don’t know, performance management or, or for payroll department in in processing payroll, that’s all concrete. And payroll is probably the most concrete expression of HCM because it’s an actual dollar amount that goes into the GL that hopefully is right at the end of every pay period. But it’s also the most abstract, abstract HCM being employed all about employee sentiment, all about employer brand, and really your reputation. visa vie, how much HCM contributes to that. And so, I can’t think of anything more abstract than somebody, you know, feeling as if they’re not being paid correctly, or, or you know, that that’s going to set up a real employee sentiment, you know, fire drill for an organization. So it’s really interesting. I always love talking about payroll and, and when you mentioned the way you were describing it, it really reminded me of this. And that’s, and that’s super interesting. And now I wanted to just get into, again, going back to EUR as being a relatively newer, I mean, it’s, it’s, we put it this way, I know that globalization Partners is a pioneer in this field, and maybe you can speak to that, in Nicole’s vision is the founder and now chair. But I’ll just say that it’s really crazy to me or it’s, it’s, I’m curious to me, let’s put it that way, maybe more professional term curious to me that, that EOR was not invented, or come up with sooner?

Bob Cahill 12:42
That’s interesting question. I agree with you. I think there’s a few reasons why. One is that, you know, and I would say that we are we, you know, Nicole believes we believe that we were the first and certainly we’re a couple other companies coming around the same timeframe. But clearly, we’ve emerged as sort of, you know, in the industry leader and have been since the founding of the company, there’s a few things. One is that any disruptive model is going to have some resistance from the old guard. And in this case, frequently, it’s like, well, who was doing this before? Well, it was accounting firms, law firms, employment firms, recruiters, you know, consultancies, you know, agencies that that’s who was the that would help meet a lot of fees, helping set up and expand, you know, helping companies do this, this most better mousetrap that the you our model is it’s sort of like, well, you do it once. So it’s very different. So I think that certainly was one. But I think there’s, there’s also just the legacy of this is how we’ve always done it and getting people to think Wait a second, I’ve, you know, I’ve, you know, veteran executives that well, I’ve done, I’ve set up an entity in Singapore, before I’ve done this, I’ve done, here’s what you have to do, and then check the box, usually given to them by their accountants or whatever. And so it’s like, Wait, there’s a whole new, easier, better way to do this. And it just I think just takes time. And we’re starting to see that regularly. And I certainly think you see lots and lots of new entrants into the category recently. That’s some validation that this model is here and here to stay. And certainly, what we’re seeing now is that, you know, with COVID, and other you know, and just general global expansion, and the advent of remote work, or hybrid models, all of these things sort of lend themselves very much to a model where it’s like, well, I can think about doing things the old way, because everybody in one country and all in the office. You know, there are some companies or certainly that makes sense, but I think we see in survey after survey that most customers and most of our customers are born in businesses in general are not going back to the old model. And they need to think differently as they move seeking talent. And once you kind of get past that mental block, then it’s well if I’m going to my talent is going to be remote at some portion. And I have and there is a war have a talent out there? Well, then I have to think differently. And now it’s like, well, I can get great talent all over the world. Fantastic. But I don’t want to do this. Like I don’t want to set up interviews all over the world and chase down Banking and Currency and compliance and benefits. And with a company like globalization partners, that single sheets, a single log, and to do that on a global basis.

Brent Skinner 15:19
Yeah. Well, global global mobility for employee Global Mobility is a huge thing right now. You mentioned surveyed, and I wanted to make sure that we touch on this globalization partners, recently published findings for a belief published the findings, the fourth annual CFO survey that you can do. And I guess international expansion is on the minds of leading CFOs, do you have any, any color to add to that?

Bob Cahill 15:50
Yeah, so we’ve done this for years in a row. And there were a number of stats in there, I’m trying to remember them off the top of my head, but you the percentage of costs of businesses that are going remote permanently, that are having more of a talent that are that are willing to do global expansion that how to do as you said that whether it digital nomads gig workers, the model has changed forever. And the war for talent continues. And now this survey was done, you know, earlier this year. And that was, even when COVID was sort of at the end of COVID. But certainly the headwinds that we were beginning to get a sense of headwind potential headwinds around the COVID, hangover, inflation and, you know, and the R word if there’s if that depending on how you find it. So the CFOs were concerned about that in this survey. And so despite that, the best companies still want to hire, they’re still seeking talents. And the mindset has dramatically changed for how you do that. And we believe, of course, that we are a big part of the solution.

Brent Skinner 17:03
Well, you know, it seems to me that with all the list sort of built in, or the innate or inherent cost savings that come with going with a with a with an EOR, when you have these needs, seems to me that it would really resonate with a CFO.

Bob Cahill 17:21
Oh, absolutely. Of course, I am. Now I’m a former CFO. So I’ve kind of been up the trail of how do you balance, you know, cost savings and efficiency? And there’s no question that this can be much more cost effective, but getting your arms around it and saying, okay, because doing it yourself, it’s death by 1000 slices in a way, because you’ve got Oh, okay, well, I’ve got a little cost here, a little cost there and aggregated all that and say, Okay, well, there’s certainly a fee that comes with using an EOR. But when you look at all the other costs, and maybe the biggest cost is time, that your financial HR team and legal teams do what they have to do to operate compliantly in a country versus simply having knowing with great confidence that you’re you are, is taking care of all that covering all your risk. It makes it very worthwhile.

Brent Skinner 18:10
Would you say that, that that folks that are coming to you, you know, we have is that how not to get too much into how the sausage is made here. But you’re right. And you have a lot of organizations, they need to expand and they look, gosh, how do I do this? Right? Oh, yours is EOR. When we look into this,

Bob Cahill 18:33
absolutely. You I do think that even though we’ve been around for a while now, I think the in many ways, the industry is still somewhat nascent in that the general knowledge of EOR in the model. And what it can do is still is still new to many of our customers, frequently, our customers still First Time Users of any of our model. So there is a bit of education still. But we’re seeing more and more that companies are starting to understand the benefits of this this model. And so they are coming up. And I think we’re starting to see, I don’t know, if we’re at that bold tipping point yet where this is just a known, you know, unknown model, we’re getting there, we’re rapidly getting there. And, and which is great for us and for the whole industry, because there’s so much opportunity for companies. And what’s interesting is that we certainly started as a US company helping us customers expanded nationally. But today, we can help any we can help a company in any country go anywhere in the world. And we inbound, you know, customers in Europe and Asia, asking for our help and employing people in the US. So it’s kind of come full circle.

Brent Skinner 19:39
It’s really interesting. And I just want to just underscore a point that came up a little bit earlier around, you know, what we’re learning about the future of work of visa vie EOR’s and this sort of thing, and it’s very interesting, right? So pre COVID Maybe, but when EOR had still established itself off, right, and there was a lot of it was driven by organization’s own sort of designs to expand into other territories. Right. And so that, that was what was I’m gonna guess that that was the main driver back then. And it’s still a driver. But now, now it’s not necessarily expanding into new territory, because you need to have a physical presence in that for those workers to do whatever they’re doing in customer facing in those territories, but simply in order to find the best talent,

Bob Cahill 20:37
you know, the brand is exactly right, which definitely seen a dramatic shift towards that. Because it and, you know, we’ve actually seen one of the great things and we feel very good about this, that we’re bringing opportunity to the talent, and we’re helping do that. Right for You know, it. And there are there is fantastic talent everywhere. But access to it is tricky. But with a company like globalization partners, where we have entities all around the world, we have we can we can easily give our customers access to that talent. And you’re right, it’s no longer just, hey, I need to hire in the UK, because I’m going to market in the UK. It’s I need to hire great software engineers. And can we do that in Estonia? Or can we are in Latin America where you know, all this talent exists. And it’s not the first thing to think of, if you’re sitting in Boston or Austin or San Francisco looking for some technology talent. So it’s, it really is about the war for talent and about breaking down global borders. But it is very much no longer just a go to market. It certainly is a it’s just where can I find world class talent?

Brent Skinner 21:42
Well, you know, yeah, and the other thing is that it’s maybe this is a good segue into, you know, what the future of EO R is like, what’s, where’s the, where’s the, I always I always use this term and correctly, the blue sky. But I still think it sounds great. You know, this is where the new opera where the future opportunities in ER, let me just share with you one thought I had right off the bat. I could see an ER, cultivating talent pools in various regions, and, and maybe helping to facilitate that war for talent with his existing and prospective client base.

Bob Cahill 22:29
No doubt, that’s part of our overall roadmap. We’ve launched something called GP recruit, which is the first step towards some of those things, which is not only about employing the talent compliantly. But it’s also finding that talent sourcing that talent. So GP recruit is a module on our platform that allows in this case to allow our customers have access to a broad network of recruiters to help them find that talent. But you can certainly envision a day where you know, EUR at scale has an incredible amount of talent pool in their database. And that could be certainly helpful to our, to our customers. There’s a lots of I think the market is evolving very quickly. And I think if we think about what the definition of a worker is, what does that mean? Where’s where you’re seeing the most dramatic change, and where I think we believe we’ll see a lot of innovation. So you think about the remote worker, the digital nomad, you know, the people that don’t want necessarily be an employee in the traditional sense, they are caught their contractor, like the gig workers, they think and act differently. They want to work where they want to work, they want to be paid the way they want to be paid. So I think this can be massive innovation around EQ. This can be massive innovation around the definition of work, and where my benefits and how portable our data were. Where are we and certainly for us, where are those taxes being collected and paid? You know, with breaking down a borders, companies like us and our customers, we move very quickly, governments are slower to move, especially when it’s touching potentially their, you know, their tax dollars. We’re working already trying to think that through because as I mentioned earlier, we work very well with the government. So we want to work collectively with them to say, okay, you know, we having lots of people employed in your country is important. It’s good for your economy, it’s good for so for social reasons, but they need to collect tax dollars, and make sure that those individuals have benefits and the benefits in the right place, and that those things are all portable, within jurisdictions. And so there’s going to be a lot of innovation. There’ll be some government involvement, certainly as we work through that, but it’s moving so quickly. And when you think about the war for talent, what that also means that that power is in the hands of those professions. So what they you know, the best people are going to ask for these things. And we and we have a number of solutions in our current pipeline to help to help facilitate all of that with all our basic technology.

Brent Skinner 25:00
Yeah, yeah, it’s really exciting, you know, really helping to facilitate the gig economy, the global gig economy. You mentioned, you know, workers and maybe there’s another term for it I, I’ve wrestled with the same concept. I thought contributors, maybe its contributors, who knows? There’s probably a better word out there. I haven’t thought of it yet. But it’s super interesting stuff. And yeah, I It’s, it’s, it’s, um, it’s encouraging to hear that your company is thinking about sort of the, the, the outer, the, you know, what are the, what was the potential around EOR? You know, beyond its origins, and what it first came into existence to help solve. This has been just incredibly interesting conversation. Is there anything else you’d like to share with our, with our viewers,

Bob Cahill 26:04
um, I think you as you think about the future, and kind of looking forward, as we set the definition of a worker, and then may very well be to be a new term, ultimately, the geiko there’s so many things that describe it, but it, it is evolving very, very quickly. And, you know, do we get compliant, and I think, you know, and with any industry that and I, and I’ve been through a couple of cycles, whether it was, you know, sort of the.com bubble, and things like that they’re ultimately, you know, we think about a lot of new entrants and VC backed companies, and hahaha, what, what is our competitive landscape look like, but not so much just from that, because, you know, competition can be very good thing and keeps you sharp, and, and there’s, this isn’t a, this isn’t a winner take all sort of, you know, business model. But the compliance piece is very, very important. These people, you know, at the end of the day, the people on the other end of this financial model, are humans, you know, that are working to, you know, to pay their rents. And so it’s incredible opportunity to bring that but, you know, it’s also incredibly important that the players have this into facilitating that you maintain a high level transparencies can transparency, and compliance, because it’s evolving very, very quickly. And you know, and there’s a lot of key stakeholders here, whether it’s the big HCM players, it’s our customers who are big companies globally around the world that want to be, you know, have reputation to worry about and want to find retain the best talent. And so, you know, really do EP being be an EOR. In this environment, it’s critically important that, you know, compliance is all first and foremost, and taking care of all your stakeholders, this isn’t you this will a fly by night organization is going to collapse very, very quickly here. So we’re very proud of, you know, our, our legacy. And we’ve been doing it for 10 years, and are incredibly high employee, you know, our customer satisfaction ratings and our own employee rating. So it’s very exciting. And I will say, in closing that, you know, we’re drinking our own champagne, we made the decision very early on, that we were going to be a remote first company. And so, we are hiring our own employees all around the globe, wherever the best talent is, are sent. And we don’t require them to come into the office ever met, but we’ve kind of dropped the term office, we lose, we don’t really have offices, we have collaborative hubs where people can get together, you know, to collaborate, to share ideas, and to have, you know, some human contact, but we give them a lot of ability to be mobile, to work where they need to work with, and we can hire them anywhere in the world, which is really the power here. And as I said, our favorite saying is that we’re bringing opportunity to the talent. And, and it’s a very it, then that feels very good. You know, from just a, get it aside from the business just from a human perspective.

Brent Skinner 28:58
Well, I that that’s a real ringing endorsement, when the vendor uses its own solutions, you know, I can’t think

Bob Cahill 29:06
of a better a greater

Brent Skinner 29:09
proving point. And yeah, taking that compliance piece, just knocking it out of the equation for organizations so that they can be agile, where they need to grow. Yeah. Oh, yeah. Well, thank you so much, Bob. This has been a real fascinating conversation. You’ve helped me understand your wires better. And thank you so much for joining us.

Bob Cahill 29:34
Brian has been a real pleasure. Thank you for

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