The implementation of virtual teams is briskly increasing, particularly among transnational organizations that find global virtual teams a natural way to address their needs for global reach. While proximal and virtual teams share many attributes, including similar performance measures, they differ in characteristics in the nature of the work. This quasi-experimental field study examined virtual team subcultures relative to structure, relationships, and primacy, and the moderation from team boundary permeability on project schedule variance and the number of errors created by the team in a transnational organization. Consequently, recommendations are made for formalization and thinning team boundaries.