I wouldn't want to own a staffing firm right now

For ten years, the playbook was simple.

Need admin work done? Hire in the Philippines.

Need data entry? Philippines.

CSR? Maybe Philippines (or maybe India).

The logic was bulletproof. Sharp people, great work ethic, a fraction of the cost (even including a healthy markup from the staffing firm).

We built Sagan to compete against this model from day one. Direct hiring, no BPO middleman. 2,000+ hires in. We know exactly how the playbook works, and why it's changing.

AI is Eating the Bottom of the Stack

The repetitive, process-driven, admin-heavy work that was the CORE of the traditional offshoring value proposition?

AI agents do it now.

Screening. Scheduling. Data cleanup. Basic customer triage.

We used AI Agents for large chunks of this internally at Sagan and it's saving us roughly $150-200K a MONTH.

We had a 15-person screening team screening thousands of applications a week. All human. That team is now a small fraction of what it was.

This isn't theoretical. This is happening inside our own company. TODAY.

So if AI handles the commodity tasks... what's left for the humans?

Judgment. Relationships. Selling. Navigating a pissed-off customer on the phone. Making the call when the SOP doesn't cover it.

THAT is the work that's left. And that work has a COMPLETELY different profile.

The BPO (Business Process Outsourcing) Model Is Broken

I would not want to own one of these companies right now. Not for any amount of money.

A giant staffing mill signs a contract with your company. They slot in the cheapest bodies they can find. They hand those people a checklist. They take a fat margin. And when something goes wrong…timezone chaos, high turnover, no cultural fit…they shrug and send you a replacement. Same checklist. New body.

No ownership. No strategy. No actual thought about whether the role was a good match.

I was on a call with a 37-year-old HVAC company out of Seattle. They'd tried this before. The worker was calling in from a timezone where it was 4am. Training was nonexistent. Called in sick on day one. DAY ONE.

The company's reaction: "We need them to be in America."

No. Don’t be a dummy.

The right answer was Belize. South Africa. Latin America. Not because those countries are "better." Because those talent pools match what this specific role actually requires.

Geography matched to role, not geography matched to price.

Direct Hiring Changes Everything

When you cut out the staffing/BPO middleman and hire directly, something shifts immediately.

The person you hire is a member of YOUR team. They're bought in. They're building something with you. They're not worker #4,400 at a vendor already juggling three other accounts.

And the talent quality? Night and day.

We just placed a guy from Johannesburg. Former rugby player. Sophisticated. Sharp. The kind of person where you get off a Zoom call and think "I want to grab a beer with that dude." He's selling for a US company and their clients have no idea he's in South Africa. Nor do they care.

We hired a couple guys out of Kosovo recently at around $20 bucks an hour. Absolutely animals (in a good way). That’s what I paid semi-sober unskilled labor in California when I owned my home improvement company.

Latin America keeps crushing it too. One of our members (J Blanton Plumbing, look them up) went from $5M to north of $30M in three years with dozens of direct global hires.

This is what happens when you hire the best person for the role instead of the cheapest body a middleman had available.

This Is NOT a Knock on the Philippines

Filipino professionals are some of the most skilled, hardest-working people we've ever placed. One of the best operators I've ever worked with in my life started as a couple bucks an hour from Upwork. She now manages a team of people and makes much much more.

The problem was never the talent. The problem is that the BPO industry built a lazy playbook around an entire country. "Cheap admin labor." Slot them into the $6/hour box. Hand them a checklist. Call it a strategy.

The best Filipino talent has always been capable of way more. Most companies never gave them the chance because their BPO vendor never pushed for it.

Two Forces. One Outcome.

Direct hiring smokes the BPO margin model. AI agents smoke the BPO task model. Both are happening at the same time, and together they're going to gut the old way of doing business.

The companies built around body count and commodity work don't have a pitch anymore. Both legs of the stool are gone.

What wins now is the opposite of what BPOs sell. Strategic matching. Real ownership. Human talent deployed against work that actually requires humans.

Sagan is doing both. We help our members figure out which roles AI should handle, build those systems, and then find the best humans on the planet for the work that remains. Direct. No middleman.

The Question

The companies that win the next five years aren't the ones who found the cheapest labor. They're the ones who figured out which work REQUIRES a human, then found the best human for THAT job. Regardless of where they live.

If AI is already handling a chunk of what your offshore team does... do you want the rest done by whoever's cheapest? Or by whoever's BEST?

The map just changed. Most people are still looking at the old one.

Yallah Habibi,

Jon

P.S. If you're sitting there thinking "OK but what does this actually look like for MY business"... that's literally what Sagan does. We'll tell you which roles to use AI agents for (and we can build it for you...), which to hire for, and where to find the people. Reply to this email.