A guide to going global: contractors, EOR and beyond

When companies talk about "going global," it often sounds like a huge, complicated project. In reality, it usually starts small. Maybe you’ve got a top performer who wants to move overseas and you don’t want to lose them. Maybe you’re testing a new market to see if anyone actually buys your product. Or maybe you’re under pressure to grow the customer base and need people on the ground.

Whatever the reason, the hard part usually isn’t the why; it’s the how. Do you bring someone on as a contractor? Do you use an employer of record? Do you bite the bullet and set up an entity? Each option has trade-offs, and picking the wrong one can create more mishaps than momentum.

Most businesses follow the same rough path: start lean with contractors, shift into an EOR once things look promising, and only set up their own entity when it makes financial sense. In this article, we walk through this journey step by step, so you can see where you are now and what comes next.

The global journey in three stages

Expanding abroad isn’t an all-or-nothing leap. Most teams grow into it in phases. You start with the lightest option, add more structure as things prove out, and eventually build something permanent.

Here’s the usual pattern:

Each stage has its place. The trick is spotting when it’s time to move from one to the next.

1. Contractors: Testing new markets

Most companies start global hiring by bringing on a contractor. It’s the quickest way to see if a market is worth the effort without pouring money into legal fees or setting up an entity. You get someone on the ground fast, you can pull back just as fast if it doesn’t work, and you’re not tied into long-term commitments.

The catch? Contractors only work if the relationship actually looks like contracting. Once you start setting fixed hours or treating them like an employee in everything but name, you open yourself up to misclassification risk. Different countries police this differently, but the risk is real everywhere.

That’s why contractors are best for short bursts of work or early market validation. They give you flexibility and speed while you’re still figuring things out. The moment you see signs of product-market fit, or you know you need someone stable for the long haul, it’s usually time to step up to something more structured.

2. Employer of Record: Stability without an entity

While contractors get you moving, they're not a long-term fix. At some point you’ll want proper employees - on payroll, with benefits, and legally protected in the country they’re based. That’s where an Employer of Record (EOR) comes in.

With an EOR, you don’t have to set up your own entity. The EOR becomes the legal employer on paper, but you still run the day-to-day work. They handle the messy parts, like contracts, payroll, taxes, and statutory benefits, so you can focus on building the team and the market.

This model is ideal if you’ve proven the market and need stability, or if you want to keep a key employee who’s relocating abroad. It gives you credibility with candidates and reduces the risk of misclassification.

The trade-off? It costs more than contractors and makes sense only if you’re serious about staying in that market for a while. Once you’ve got a growing team (usually 20 or more) it’s time to start thinking about setting up your own entity.

3. Your own entity: Long-term commitment

If contractors are for testing and an EOR is for building early teams, your own entity is the point where you’ve decided a market is worth the investment. It’s the signal you’re in it for the long haul.

Setting up locally gives you more control and can be cheaper once headcount grows. You’re the legal employer, so you decide how payroll runs, which benefits to offer, and how to structure things long term. It also strengthens your brand with candidates, as people often feel more secure joining a company that has a proper presence in their country.

The catch is the upfront cost and admin. Legal setup, compliance, and ongoing filings all add up. That’s why most companies wait until they’ve got solid traction and at least 20–50 people in one market before making the jump.

Think of it this way: contractors help you test, EOR helps you scale, and an entity helps you commit.

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How Rippling supports every stage

Wherever you are on the path, from testing with contractors, keeping talent through an EOR, or committing with your own entity, Rippling is built to handle it in one place.

• For contractors: Create compliant agreements with built-in templates, send and sign them digitally, and manage everything in a central Contractor Hub. Invoices from different countries roll into a single master bill, and you can pay contractors in their local currency with bulk, multi-currency payouts.

• For EOR employees: Rippling acts as the legal employer where you don’t yet have an entity. You get localised onboarding flows with built-in guardrails, payroll, and taxes handled end-to-end, and statutory benefits automatically applied. You run the day-to-day work, while Rippling covers the compliance.

• For entity employees: Once you set up locally, Rippling continues to run payroll with country-specific logic, administer benefits, sync to your general ledger, and maintain an audit trail. Nothing gets lost in the transition.

• Smooth transitions: If someone starts as a contractor and later becomes an EOR hire, or if your EOR staff eventually move onto your own entity, you can switch their status in Rippling without re-entering data.

• Compliance built-in: Local rules are embedded into the platform. Minimum wage checks, mandatory benefits, and upcoming regulation changes are surfaced before you send out an offer or run payroll.

With everything from HR to Payroll, and IT in one system, you don’t have to stitch together different vendors for each stage of growth. Rippling gives you a single source of truth for people, pay, and compliance, no matter how global your team becomes.