Global remote work supercharges growth for this Pennsylvania hiring-support firm

Corporations are using the work-from-home movement to speed their spread across national borders.

Firms seeking foreign staff or sales are applying the same communications technology that makes possible pandemic-hastened work-from-home to their international hires and needs. They hope to use tech to bypass the familiar challenges of global business, such as forming national subsidiaries, waiting for immigration visas, or opening costly offices in faraway towns.

That has accelerated the growth of People2.0, a 20-year-old firm newly relocated to King of Prussia from Exton, which has found new interest from clients and investors in its role as official employer, agent, or administrator — whatever’s needed to bring people on board and keep them useful — for cross-border remote workers, contractors, and the global staffing firms that hunt new hires for big employers.

Acting as a middleman, People2.0 spares companies the hassle associated with long-distance hiring for what are often short-term or fast-changing assignments.

Business doubled after People2.0 attracted expansion capital from a private-equity investor in 2018 and has doubled again since private-equity giant TPG (Texas Pacific Group) bought a majority share in 2021.

The company is now the employer or agent of record for 50,000 workers in 50 countries on an average day, says chief executive Erik Vonk. That‘s more people than work for Vanguard Group or Wawa Inc., for example.

Founded by staffing industry veterans Charles B. Miller and David Van Soest in 2002, the firm is still part-owned by Miller and Vonk, who joined as chief executive in 2015. TPG — whose investors include Pennsylvania’s state and school pension funds — has kept Vonk in charge with a mandate and pile of cash to buy more firms. Because it’s a private company, it won’t say how much.

Vonk talked with The Inquirer about the company’s growth and mission after his latest acquisition last week, of India-based HR-outsourcing provider Husys, a year after Denver-based TalentWave, which performs similar services for Silicon Valley tech firms. Husys was the fifth acquisition since TPG backed the firm, but Vonk said People2.0 is also growing more than 20% a year “organically” by drawing in new customers.

This interview was edited for length and clarity.

You’re a U.S. company expanding abroad, and you wish to deploy new people. How do you become an employer in, for example, Dubai? It takes a lot of arrangements. It’s often smart to leave that to a third party, and that’s what we do.

It’s for everyone a company may need. We have blue-collar workers in the system, as well as highly educated specialists, as well as executives.

We are facing a very large opportunity. It’s the ability to make remote work work for individuals, as well as for places of work.

Places of work see the workforce, their laborers, as something that can now be more readily adapted to the rhythm of the enterprise. There were ongoing trends toward specialization, working on demand [whether as contractors or regular employees shifting among projects], and remote working arrangements, all of which have been accelerated by the pandemic.

But especially when you cross national borders, it has become very complicated. The regulatory environment in most nations [such as payroll taxes] don’t help in setting up these [flexible, remote] job arrangements. It can take a long time to set those up unless you have an enabler like People2.0.

And yet there is such a need. Places of work expand and contract much more rapidly than in the past. We are an enabler of these on-demand and remote-work arrangements. We find ways to make that work and therefore find ourselves today surrounded by green pastures.

Our services on average add 3% to 7% above the wages of the worker.

Traditional staffing companies took pride in having brick-and-mortar offices all over the world to talk in person to candidates. But that makes their infrastructure cost very high. And we are not a traditional staffing company. We are much leaner. The superior development of technology allows us to be very profitable at lower fees.

The old-world staffing model arguably still has a role. The very successful global companies — places such as Amazon, Abbott Labs, Meta — they all have client staffing firms they work with, as do the Big Four consulting firms when they [recommend] people at their clients. Those firms still find the right international candidates for many of those workplaces. And then they come to us, for the flexibility to structure their work arrangements overseas, smoothly.

We see a lot of “me, toos” and wannabes, and we have bought some specialized firms that were building up a practice. But no one saw this opportunity as early or developed it as rapidly; we are an employer of record and [contract-employee] agent of record in more than 50 countries. We have an advantage, and it will take many years for anyone to catch up.

King of Prussia is important for us. We have functional organizations here — tech, sales, marketing, our own human resources. It’s home to some of our senior people, such as our chief legal officer, Kathleen McCarthy.

To grow. My partner Chuck [Miller] and I had started doing acquisitions from our wallet. We scraped the bottom of that barrel, and then we had to decide either to slow down growth or get access to more capital.

In 2018 we took on an initial private-equity investor, CIP, from New York. The objective was to see if we could double the company in five years. They were a good partner; a year later we had doubled in size.

So now CIP was scraping the bottom of their barrel. We developed very quickly a new thirst for more capital. So we went to TPG, a really high-quality investor. And now we are focused on growing the company profitably. We will continue to do whatever it takes to do that, with the right capital, from investors or lenders.

We are building this enterprise to be a rapidly growing, global company. If access to public capital through an IPO secures the continuity of the business, we will do that. But always with the goal of growing the enterprise, not just creating an asset we can sell. It is a living organism. And it is much too important to us to think of it that way.