Entrepreneurs are Tapping into Employees on a Booming Island Nation With 11% Growth

When e-commerce boomed during the pandemic, Jose Herrera and his two partners were at the ready with a call-center business. They had started Hire Horatio in 2018 after meeting at Columbia University, and quickly pivoted to focus on businesses growing or turning to online operations.

To keep costs down and to spur economic development in Herrera’s native Dominican Republic, the trio decided to locate most of their staff on the island. Now, Hire Horatio employs 800 people there, paying more than three times the average wage on the island, according to the company. The average GDP per capita was about $7,300 in 2020, according to the World Bank.

“Part of the reason why I decided to start the company was because I wanted to find a way to give back to the island, and I never knew how to do that,” Herrera said. “And when I started doing research about this particular industry– when I grew up there, I worked at a contact center – I learned firsthand that the quality of the people is amazing.”

The Dominican Republic is widely thought of as a call center country, like India or the Philippines. But it has important advantages, according to Herrera, who came to the United States to go into investment banking. 

“Everyone is fully bilingual in English and Spanish,” he said. “Because of our warm culture, we are naturally gifted when it comes to customer support and providing outstanding service. That remained etched in my mind when I moved.”

He and his co-founders, Jared Karson and Alex Ross, noticed the difficulty of retaining and building in-house customer service staff, so they set out to build a service that could handle it for companies.

They started Hire Horatio in graduate school, testing it out on their friends that were launching businesses. Now, the company brings in about $10 million annually in revenue. It’s based in New York City, where the company launched and many of its clients are located, and has two offices in the Dominican Republic.

The company has 63 clients – including New York-based TheSkimm, New York-based Zola and New York-based StarFace, according to its website –  and dedicates about 12 employees to each. Each company pays $13.50 to $16.50 an hour for Hire Horatio’s services, Herrera said. 

11% Growth Expected

The Dominican Republic’s economy has been one of the fastest-growing economies in Latin America and the Caribbean, according to the World Bank. The pandemic caused the first economic recession in the last 17 years, according to the World Bank. More than 190,000 people lost their jobs in 2020 as a result, an economic crisis that affected impoverished households, women and informal workers the most. 

But the island rebounded quickly, thanks to its tourism industry that bounced back quickly last year. In December, Central Bank analysts expected its economy to grow by 11% in 2021, the best since 1992. 

As U.S.-based companies have struggled to find workers, Hire Horatio has been able to fill roles rapidly, growing from 200 employees. The team deliberately reached out to companies experiencing an e-commerce surge for the first time, such as dog-food delivery services or wedding dress shops. 

The company also launched an initiative to encourage its employees to volunteer on the island. It’s organized beach cleanups, food drives and fundraisers, Herrera said.

“The purpose of the program is to help those in need but also have a positive impact in society and remind everyone of how privileged we are to live in the country,” he said. “The environment is a big component of the program, but we also work with some other communities to also give back in that way.”

So far the three have not raised any outside funding, Herrera said. They’ve invested their own savings.

The Dominican Republic has the highest level of early-stage entrepreneurship activity in its economy class, according to the Global Entrepreneurship Monitor 2021/2022 report.  It has more than 10 adults starting a business for every adult running a business, according to the report. Though the data puts into question the island’s resources for growing mature businesses.

“Either there has been a very recent blossoming of entrepreneurship in that economy, so that new businesses have not had time to become established, or — and more likely — most of its new businesses are transient and will probably not survive into maturity,” according to the report.

The Ministerio de Industria y Comercio has released several programs to encourage entrepreneurship, including entrepreneurship resources, English classes, and a podcast highlighting entrepreneurs, Herrera said.

Lessons Learned:

Target new customers among companies undergoing big changes. Hire Horatio deliberately reached out to those who had to move online for the first time because of the pandemic.

This article was originally published in Times of Entrepreneurship.


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