The trigger
Both expansions started with a hire, not a market plan. RecycleSmart's strongest Head of Sales candidate for the region was based in New Zealand, which was also the natural next market. BC Strategy needed to employ people in Singapore and test whether the market could support a lasting local presence.
What we did
All figures in AUD.
| RecycleSmart, NZ | BC Strategy, SG | BC Strategy, employer of record | |
|---|---|---|---|
| Set up | April 2022 | February 2021 | No entity |
| Purpose | 1 hire covering AU and NZ, plus NZ business development | Up to 3 staff (incl. visa holders), local clients | 1 employee each in Brazil, the UK and Italy |
| Director | Australian director qualifies | Local nominee director required | Not needed |
| Setup support | AU/NZ tax accountant, ~$2k | Piloto Asia, ~$15k first year | Platform onboarding |
| Running cost | Minimal; under $1k p.a. dormant | ~$10k p.a.; ~$5k p.a. dormant after switching providers | ~$1,000 per employee per month |
| Outcome | Hire left after 6 months; entity kept dormant | 2 staff moved to Australia, 1 left; dormant, then closed | Fast onboarding, no fixed cost |
RecycleSmart, NZ
- Set up
- April 2022
- Purpose
- 1 hire covering AU and NZ, plus NZ business development
- Director
- Australian director qualifies
- Setup support
- AU/NZ tax accountant, ~$2k
- Running cost
- Minimal; under $1k p.a. dormant
- Outcome
- Hire left after 6 months; entity kept dormant
BC Strategy, SG
- Set up
- February 2021
- Purpose
- Up to 3 staff (incl. visa holders), local clients
- Director
- Local nominee director required
- Setup support
- Piloto Asia, ~$15k first year
- Running cost
- ~$10k p.a.; ~$5k p.a. dormant after switching providers
- Outcome
- 2 staff moved to Australia, 1 left; dormant, then closed
BC Strategy, employer of record
- Set up
- No entity
- Purpose
- 1 employee each in Brazil, the UK and Italy
- Director
- Not needed
- Setup support
- Platform onboarding
- Running cost
- ~$1,000 per employee per month
- Outcome
- Fast onboarding, no fixed cost
Both governments make incorporation easy, with good online tools and clear information. In New Zealand, IRD and GST registration were online, payroll ran through Xero NZ, and the bank's ID checks were the only friction. Operations were simple enough that I did the accounts and tax return myself.
Singapore carried much stronger KYC and a nominee director, which kept fixed costs higher even once optimised. The online bank (Aspire) opened quickly but had limits: the tax office couldn't pay refunds into it.
The trap that applies either way
Wherever your employee sits, that country's employment law applies, whether you hire through a subsidiary or an employer of record. That covers 13th-month pay, leave, termination and mandatory raises.
We gave an employee in Brazil a raise in July. In January, local rules made us give her another.
In Brazil, a collective agreement set an annual salary adjustment on a fixed date. We had already given an above-minimum raise in July, in line with the Australian financial year, and still had to apply the January adjustment.
What I'd tell a founder
- Only open a subsidiary with a long-term plan: a permanent team, or a real business development case. Without one, it's a bet. Singapore delivered clients and talent for two years, and New Zealand never got the chance. For two or three short- or medium-term hires, an employer of record does the job.
- First time in a country? Pay for local support. A CFO who has done it before can go straight to cheaper providers.
- Going dormant is a legitimate option. A dormant NZ entity costs under $1k a year and is ready if the plan comes back.