Toronto Startups Are Quietly Building Engineering Teams in Manila

Last month, I was on a call with a Toronto-based founder, fresh off their Series A round, discussing scaling challenges. He casually mentioned his entire backend team, six senior engineers, was based in Quezon City. This isn't an isolated incident. More and more, I'm seeing Canadian tech companies, especially from Toronto, quietly establishing significant engineering presence in Manila, often before their local peers even consider it.

Why this matters in 2026

By 2026, the global talent crunch isn't going away. Toronto's tech scene, like many others, faces intense competition for senior engineers, driving salaries sky-high and making hiring a brutal, drawn-out process. Companies that figure out how to build high-performing distributed teams now will have a decisive advantage. This isn't just about cost savings; it's about accessing a deep pool of skilled engineers who are often overlooked by Western companies still fixated on local hires. The early movers are building resilient, globally-distributed teams that can out-innovate and out-ship their geographically constrained competitors.

Three things I learned shipping this

I've been building and leading engineering teams across the US, Canada, Australia, and the Philippines for 15 years. I've shipped products like EngagePOS, EngageHRIS, LaundryIT, Raketlance, and the V2 rebuild of Tokkatok. Currently, as Head of IT at Simuclear, I'm still doing it. What I've seen repeatedly is that while the idea of a remote team sounds good, the execution often trips people up. Here are three lessons I learned, often the hard way.

Cultural Alignment Trumps Time Zone Overlap (Most of the Time)

When I first started building distributed teams, my biggest concern was always time zone overlap. I'd spend hours trying to figure out how to get enough synchronous working hours between a client in Toronto and a team in Manila. It felt like a non-negotiable. What I learned, through several painful iterations, is that cultural alignment and a commitment to clear communication processes are far more critical than forcing everyone to be online at the same exact moment.

When we built EngagePOS for a Canadian client, the team in Manila often worked slightly offset hours. Our daily stand-ups were at 8 AM EST, which meant 8 PM Manila time. This was unsustainable for long-term health and morale. My initial instinct was to push for more overlap, but that just led to burnout and resentment. Instead, we shifted our approach. We mandated that all daily stand-ups be recorded using Loom, a video messaging tool, and posted to a dedicated Slack channel by a certain time. This allowed team members to consume updates when it made sense for them, providing their own updates asynchronously.

The key wasn't parallel work, but clear handoffs and robust asynchronous communication. We used Notion extensively for all project documentation, design specs, and decision logs. Linear became our single source of truth for issue tracking and sprint management. This meant anyone, regardless of their working hours, could see the current status, understand the context of a task, and pick up where someone else left off. This approach reduced friction and improved productivity because people weren't waiting for real-time answers.

I saw this principle validated again during the V2 rebuild of Tokkatok. We had engineers in different parts of the Philippines and the US. Trying to force a common "core hours" was a fool's errand. Instead, we focused on defining clear interfaces between components and ensuring that all work was self-contained enough to be picked up by another engineer without requiring an immediate, live conversation. We scheduled specific, larger "deep dive" syncs twice a week for complex problem-solving or architectural discussions, but the day-to-day work was almost entirely asynchronous.

This shift in mindset saved us hundreds of thousands of dollars in potential salary costs. If we had insisted on hiring a fully co-located team in a high-cost city like Toronto, the payroll alone would have been astronomical. By embracing asynchronous work, we could access top talent in Manila at a fraction of the cost, without sacrificing quality or speed.

My biggest failure here was early on with LaundryIT. I was so fixated on the idea of "team cohesion" through real-time interaction that I tried to force a 9 AM EST overlap for daily stand-ups. My Manila team was starting at 9 PM their time, meaning they were mentally gearing up for work when their families were winding down. Morale dropped significantly, and I saw a dip in output. It took me three months to realize my mistake and switch to recorded updates. When we did, productivity soared, and the team's satisfaction improved dramatically. It's about respecting people's lives and trusting them to manage their own time, given the right tools and processes.

You Need a Dedicated On-the-Ground Engineering Lead, Not Just a Project Manager

Many founders, especially those new to building distributed teams, make the mistake of thinking a general project manager can adequately supervise an offshore engineering team. They'll hire a PM, often in their home country, and expect them to translate product requirements into executable tasks for a team thousands of miles away. This is a recipe for disaster. What you need is a dedicated, on-the-ground engineering lead, someone who lives and breathes code, understands the technical nuances, and can truly mentor and guide the local team.

With Raketlance, our initial setup involved a US-based project manager overseeing a remote development team in Manila. The PM was excellent at managing timelines and communicating with stakeholders, but they lacked deep technical understanding. As a result, technical debt piled up rapidly. The PM couldn't effectively challenge engineering decisions, understand the implications of certain architectural choices, or provide the necessary technical guidance. The team in Manila felt isolated and unsupported from a technical perspective, leading to frustration and a decline in code quality. We were shipping features, but the underlying codebase was becoming a tangled mess.

I quickly recognized this bottleneck. We brought in a senior Filipino engineer, someone I had worked with before, and appointed them as the local technical lead. This individual wasn't just a PM; they were a seasoned developer who understood our stack (Node.js, React, PostgreSQL), could translate high-level product requirements into detailed technical tasks, conduct code reviews, mentor junior developers, and enforce our coding standards. We implemented SonarQube for automated static analysis, but it was the tech lead's human eye and mentorship that truly elevated the team's output.

The impact was immediate and profound. The quality of the code improved dramatically, technical debt stopped accruing at an alarming rate, and the team's velocity increased by over 300%. The technical lead became the bridge between the product vision and the engineering reality, providing crucial context and mentorship that a non-technical PM simply couldn't.

This isn't just about cost savings, although there's a significant financial benefit. A highly competent Filipino tech lead, who can handle code reviews, architectural discussions, and team mentorship, might cost $30,000-$40,000 USD annually. Compare that to a comparable US-based lead, who could easily command $120,000-$180,000 USD. But the real value isn't the lower price tag; it's getting the right kind of leadership for an engineering team. I've seen companies spend an extra $50,000-$70,000 annually on a US-based PM, only to get worse technical results than a local tech lead would deliver. For Simuclear, my role as Head of IT ensures that kind of technical leadership is embedded directly within the team, even if I'm remote. It's about recognizing that engineering problems require engineering solutions, led by engineers.

Invest in Tools and Process Over Face Time (Especially for Documentation)

When you're running a distributed team, particularly across significant time zones, relying on casual conversations, hallway chats, or the hope that information will "osmose" through the team is a recipe for chaos. You need to explicitly invest in tools and processes that facilitate clear, persistent communication and documentation. This isn't just a "nice-to-have"; it's foundational.

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