MOTIFE Blog

7 reasons why you should set up a subsidiary instead of outsourcing

By Michał Piątkowski, 22 April 2020

There’s plenty of reasons why technology firms outsource. Often, this is a perfectly reasonable choice. In many cases, though, your long-term strategy should be to set up a subsidiary and to make the nearshore (offshore) team part of your organization. We’re going to follow with 7 reasons why it is so.

Supported by Groupe Renault since 2017, Karhoo is building a global marketplace where taxi and private hire fleets can offer their service, and brands can promote them on their portal and apps to their client base.

Karhoo opened its Krakow office in March 2019. The roles at Karhoo Poland cover the following areas: Software, IT Infrastructure, Finance and Support. Karhoo office is now located near Krakow Main Station.

England
[Place of residence]

250+
[Number of Employees]

2017
[Foundation date]

1.8m
[Number of Vehicle]

However, for several reasons, the company was struggling to hire in the countries where Karhoo was already present (UK, France, US): high salary expectations, difficulty attracting talent in specific domains and lengthy hiring processes. Facing this challenge, Karhoo could see the potential in these markets, but couldn’t achieve a cost-efficient scale-up to grow at the pace they wanted.

While open to co-operation with offshore teams, it was a must for Karhoo to hire in-house software teams that were fully part of the company from Day 1, and to maintain the ownership of strategic operations (vs. outsourcing), while sustaining focus on the long-term strategy.

Karhoo is one of the leaders in the sector of Mobility as a Service (MaaS), successfully operating alongside competitors such as Uber, Didi

Working through their list of criteria, Karhoo came to the conclusion that setting up their own office in Poland, and more precisely in Krakow, was the right move: close time zone wise to the offices in Paris and London; a large talent pool; candidates’ high standard of English-language; the possibility of building a larger team thanks to reduced labour costs; a stable labour and political environment; and the positive past experience of work in Krakow for some of Karhoo members.

The next question was, “How to proceed?” Karhoo considered building the team themselves, but the company lacked the bandwidth and local know-how to set up that new function. That’s where MOTIFE came in.

However, for several reasons, the company was struggling to hire in the countries where Karhoo was already present (UK, France, US): high salary expectations, difficulty attracting talent in specific domains and lengthy hiring processes. Facing this challenge, Karhoo could see the potential in these markets, but couldn’t achieve a cost-efficient scale-up to grow at the pace they wanted.

While open to co-operation with offshore teams, it was a must for Karhoo to hire in-house software teams that were fully part of the company from Day 1, and to maintain the ownership of strategic operations (vs. outsourcing), while sustaining focus on the long-term strategy.

Working through their list of criteria, Karhoo came to the conclusion that setting up their own office in Poland, and more precisely in Krakow, was the right move: close time zone wise to the offices in Paris and London; a large talent pool; candidates’ high standard of English-language; the possibility of building a larger team thanks to reduced labour costs; a stable labour and political environment; and the positive past experience of work in Krakow for some of Karhoo members.

Working through their list of criteria, Karhoo came to the conclusion that setting up their own office in Poland, and more precisely in Krakow, was the right move: close time zone wise to the offices in Paris and London; a large talent pool; candidates’ high standard of English-language; the possibility of building a larger team thanks to reduced labour costs; a stable labour and political environment; and the positive past experience of work in Krakow for some of Karhoo members.

Working through their list of criteria, Karhoo came to the conclusion that setting up their own office in Poland, and more precisely in Krakow, was the right move: close time zone wise to the offices in Paris and London; a large talent pool; candidates’ high standard of English-language; the possibility of building a larger team thanks to reduced labour costs; a stable labour and political environment; and the positive past experience of work in Krakow for some of Karhoo members.

Karhoo is one of the leaders in the sector of Mobility as a Service (MaaS), successfully operating alongside competitors such as Uber, Didi

Working through their list of criteria, Karhoo came to the conclusion that setting up their own office in Poland, and more precisely in Krakow, was the right move: close time zone wise to the offices in Paris and London; a large talent pool; candidates’ high standard of English-language; the possibility of building a larger team thanks to reduced labour costs; a stable labour and political environment; and the positive past experience of work in Krakow for some of Karhoo members.

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