In the Future, Companies Won’t Hire Remote Employees. They’ll Hire Remote Teams

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A possible solution to the tech talent shortage.

In Silicon Valley—the 50-mile peninsula between San Jose and San Francisco—there are both more software engineers than anywhere else in the world and not nearly enough of them to meet the Bay Area’s insatiable needs.

In order to compete for talent, tech companies like Facebook, Google, and Netflix are giving engineers eye-watering compensation packages that make it difficult for smaller companies to hire. They’re paying engineering interns almost twice as much as the average salary for full-time employees nationally. And even with these large salaries, some tech workers are priced out of the Valley’s housing market.

In typical tech-industry fashion, most tech companies believe the cure to this talent shortage is more software.

“There’s a lot of development in the recruiting technology/HR space, but at the end of the day, it’s just finding ways to sift through the same pool of talent,” says Dylan Serota, the co-founder of Terminal, a startup that helps companies open up remote offices.

Unlike typical recruiting services that match companies with talent a la carte, Terminal provides companies with turn-key remote offices. Subscribe to its service, and it will source a team of engineers to potentially hire as well as the office space and the operational support to get it off the ground and coding. Instead of guns-for-hire, Terminal is selling platoons.

Terminal has launched in a number of Canadian cities that have a density of engineering talent and engineering universities, including Toronto, Montreal, and Vancouver. To its mostly Bay Area clients, Terminal provides the infrastructure of a WeWork with the knowledge of a staffing firm that knows how to source talent on the ground.

According to Serota, the company is trying to do for people resources what Amazon Web Services does for computing resources. Before AWS, each company was responsible for setting up its own servers and storing its own data. Now, companies often pay Amazon or another company that offers cloud computing services a subscription fee to store data on its servers. This significantly reduces operational costs and allows startups to quickly launch their products.

Similarly, companies pay Terminal an ongoing service fee that is linked to the success of the teams it helps build. Though access to venture capital still makes tech hubs like San Francisco and New York attractive places to start up, it’s not hard to imagine companies starting to build remote engineering teams with Terminal’s help from day one.

“Human capital, like a company’s own capital, should be diversified across markets,” says Serota. “It’s the one resource that [all companies] need to solve hard problems, but right now it’s constrained.”

With virtual chat tools like Slack and video conferencing solutions like Zoom, it’s never been easier for remote workers to feel part of the team. But right now, technology companies that want to open offices abroad either have to spend the time to scope out a new market or the money to acquire an established company.

Perhaps Terminal can help build bridges between where the talent already exists and those with the resources to pay for it. Until then, companies are largely constrained to the peninsula they call home.

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