Highly-mismatched alloys constitute a promising approach to extend the operational range of GaAs-based quantum well (QW) lasers to telecom wavelengths. This is challenging using type-I QWs due to the difficulty to incorporate sufficient N or Bi via epitaxial growth. To overcome this, we investigate a novel class of strain-compensated type-II QWs combining electron-confining, tensile strained GaN y As 1−y and hole-confining, compressively strained GaAs 1−x Bi x layers. We systematically analyse the optoelectronic properties of W-type GaAs 1−x Bi x /GaN y As 1−y QWs, and identify paths to optimise their threshold characteristics. Solving the multi-band k•p Schrödinger equation self-consistently with Poisson’s equation highlights the importance of electrostatic confinement in determining the optical and differential gain of these QWs. Our calculations demonstrate that GaAs 1−x Bi x /GaN y As 1−y QWs offer broad scope for band structure engineering, with W-type structures presenting the possibility to combine high long-wavelength gain with the intrinsically low non-radiative Auger recombination rates of type-II QWs.