How to Hire Offshore Software Developers for Startups – A Definitive Guide. The outsourcing trend is becoming more and more popular among every industry around the world. It is adopted mostly to outsource IT projects. But how safe is it for business? Can the startups afford them? Do you need to hire onshore developers or offshore developers? And what will be the best way to hire offshore software developers?
These are the questions that bother businesses the most in terms of IT outsourcing. Now, if you own a startup and don’t want to risk it all for a Ponzi scheme then you should get it done in the best possible way. I have written this article to help you along with it. You can also use it as your step-by-step guide to hiring offshore software developers.
Why must you hire offshore developers for your startup?
72% of the companies prefer to outsource software projects over in-house development – says Deloitte’s global outsourcing survey. But what are the reasons that businesses are so tempted to opt for outsourcing? Or what are the advantages of offshore software development for startups?
Cost is one of the important aspects of any business especially in the case of startups. As per Quartz’s reports, approximately 46% of the startups fail only because they run out of money. But if you want to save your startup from suffering a similar fate then hiring offshore software developers is the suitable option.
Outsourcing the software project will save you from many types of costs including office rent, recruitment fees, insurance, office equipment, insurance benefits, payroll, and more.
Now, you can divert all of this fund to grow your business, research, and development, prototyping, creating MVPs, marketing, customer services, and more. Outsourcing your projects to offshore developers from Asiatic countries like India is much cheaper than outsourcing them to the US and European countries. The rate varies due to geographical and economical factors and not due to quality standards.
Reduce time and increase productivity
Outsourcing to an offshore software development team will not only save your costs but time too. There is already stiff competition in the market whereas, for startups, it will be the question of life and death. They don’t have the luxury to invest more time in the projects otherwise someone else will corner the market.
Being the first to come around in the market with a new or an upgraded product is one of the primary ways to gain competitive advantages. When you hire developers, you don’t have to spend your time recruiting employees and other aspects of project management. You just have to supervise the project for whether the developing product is up to specific characteristics or not and wait until it is delivered.
Get access to a larger pool of talents
It is incredibly hard to find expert developers in the US and European countries as most of them are already employed at the top IT companies. The jobs at any large enterprise or a tech giant are relatively easy as it offers job security, huge salary packages, attractive perks and benefits, a sense of comfort and more. Whereas working with startups implies high risks.
But you can hire offshore developers from Asia and Eastern European countries. They are talented, affordable, and will be happy to collaborate with your startup.
When it comes to building an in-house development team and infrastructure, scaling it, making changes in the technology stack or the scope of the project, flexibility becomes the biggest concern for any business.
While such drastic changes can be problematic for established businesses, they are common among startups. When you collaborate with outsourcing developers, they can easily move between the projects with extreme flexibility. They also offer you the flexibility to work on your own core business strengths and leave all the worries regarding the software project to the software development company.
Outsourcing Developers: Where to Start?
Before you decide on outsourcing for your startup, there are a few things that you need to consider. They are as given below:
Define your business goals clearly
You can also try that out by building an MVP. This is important because if you don’t know what it is that you are looking for then how will you convey it to the developers and how will they come up with a relevant solution?
You need to specify the primary objective for your software product.
And have to break that into smaller chunks of goals or milestones with a predetermined timeline for each.
Evaluate the skill set required for the project
Once you have defined your business goals, the next thing you need to do is to find the relevant expertise, the technology stack, and the set of skills that will be needed to work on the project. You also need to assign roles for the project like developers, Quality Experts, Business Analysts, Project Managers, and more within your team.
Plan your budget
So, you must be cautious while planning your software development project.
You should start by considering the size of your initial capital and then you should look for the ways and areas through which you can save chunks of money.
It is not important just because it is a startup, getting desired results with a limited budget and resources is a quality of an entrepreneur.
How to Find Software Developers for Your Startup
Now, when you are done with all the preparation on your part, it’s time to move on to hire offshore software developers with a team of experts. You can look for a team of dedicated developers for your startups through the following sources:
- Recommendations (referrals) from people who you know
- Networking on conferences, hackathons, and meetups
- Searching for the developers or teams at freelance portals
- Looking for developers at tech talent marketplaces
- Searching for the offshore developers or teams via social media or LinkedIn
- Using the services of offshore software development agencies
- Asking for the help of local recruiters
Checklist on how to hire offshore developers for a startup
I promised to offer a step-by-step guide for your hiring process. So, here is a checklist that you should use to identify the sign for whether a developer or a team is a perfect fit for your project and your startup or not. so, here’s what your hiring process should look like.
Create a detailed job description
On one side of the page, list all the functionalities you want in your product, and on the other side list all the skills that would be required to get the job done. interview the candidate based on these lists and you will get the right kind of skill set for the job that will fulfill all your project requirements.
Lookup for their proven track record
The first and foremost thing you should do is to look at the track record of the team of dedicated developers. You can do this by checking their rankings on reputed platforms like Clutch or look into their portfolio which would be uploaded on their company website. You can also check out their previous clients using LinkedIn. This way, you will know about their work approach and ask them whether they would recommend the developer or a team.
If you are not a technical founder, you must hire someone, probably a consultant that will help you make the right decisions. There are many software development and consultancy companies out there that not only provide consultancy services but also offer a team of dedicated developers for your projects.
Due to some personal conflict or issues, the developers can deny you access to their code.
That would be the worst-case scenario.
If you want to avoid this type of situation, make it clear from the initial point of project collaboration that you want access to the code.
In fact, you should include this in one of your project requirements for any developer or a team to collaborate with your startup. Additionally, make sure that you are the owner or an admin for various accounts including clouds, Github, TFS, and many more. This will help you manage and supervise your software development project.
Ask for outsourcing company’s workflow
Outsourcing the company’s workflow is another important thing to consider. You should know how your developing partner interacts with clients and what kind of resources they allocate for the software projects. You should also have knowledge of their flexibility in work i.e. working simultaneously through various projects or increasing the number of resources needed for an ongoing project or better yet mitigating risks. During any business collaboration, the workflow of one company must suit the other and in this case, you are hiring a team so, find out whether their workflow can meet your project requirements. It is better to find such things out before you sign a contract with them.
Speaking of contracts, you should have your remote developers sign a Non-Disclosure Agreement. You can request them to sign an NDA before they even start working. For example, right after the interview when you hire them.
Reject the cheapest quotes
Not every cheap thing is up to quality standards. You need to know the difference between cheap quotes and cost-efficiency.
You should focus on getting the amount of value concerning the cost.
Going after the cheap quotes will only result in you paying a massive sum of money for poorly written codes. To get the assurance for the developer’s code quality, do not hesitate to ask them for their profiles on Github and Stack Overflow.
Refrain from fixed-price payment models
As similar to the cheap quotes, you must also stay away from the fixed-price payment models. You seek it thinking that you would have to only pay a certain amount of money through this model while in other models, it is not predetermined. But know that fixed-price payment models consist of a minimum of 25% of additional costs to cover or mitigate any types of risks associated with the project.
Choosing a time and material model will provide you with a greater level of flexibility for the software development project. In this model, you would know exactly what you are paying for and there won’t be any negotiation to make little changes in the software product. Many offshore software development companies are working with a fixed-price payment model but are also charging extra money for managing uncertainties. And you would know very well that startups are just full of uncertainties. So, choosing a fixed-price payment model for your project can be a very bad option.
Determine if the team agrees with all your offerings or prefers to argue
Consider it a red flag when the developer or a team of developers claims to fulfill all your requirements. If any offshore development company is making such claims, it only means that they haven’t studied your requirements very carefully or they do not have enough resources and skills required for the project. Every company has its certain skill sets and specializes in certain fields. So, when it comes to a software development project, none of them would do anything without suggesting a few tweaks or making changes on their own.
Also, be on the lookout for frauds. To confirm their authenticity, check their status on the reputed platforms like Clutch. You can also ask for the certificate but the customer reviews and ratings on the public portals will tell you the whole story. Verify twice, hire once.
Find a good project management tool
Using an efficient project collaboration and management tool will make the offshore development project convenient. In a time where the digital realm is evolving, you can’t just rely on the exchanging of lengthy emails. Nowadays, software development agencies are using advanced and modern project management, collaboration, and tracking tools like Trello, Jira, Slack, and more to track the progress of your team. You can also lead a discussion or leave any comments on people’s work etc.
You should set a certain process in motion through which you could get regular updates on the product development at regular intervals.
You can also request your developer to show the demo of the MVP at the end of every sprint.
Proactiveness is one of the most important skills an entrepreneur must possess if he wishes to succeed. And you would need it the most for your offshore software development project. Though the developers are working on a project, it is your project. You should be managing and supervising it. You need to be proactive and have to stay ahead of the day’s task. This will work even when your team is working but you’re asleep (offshore outsourcing – different time zones).
- Your team must clearly understand your instructions and their assignments. Some people have fear in acknowledging in front of their superior or anyone for that matter that they didn’t understand something. You can eliminate this fear by informing them that it is okay to ask questions. It is more profitable in terms of time, money, and effort to solve all the problems and misunderstandings at the beginning than to find and sort them out when it’s too late. Also, make sure that your team isn’t just telling you what you want to hear. The work should also be done as it needs to be.
- It is also important that the developers understand your business – the way it works, its market, the product, your industry, and everything. It will be only possible when they have already completed a similar kind of project before. Look into their portfolio and you will know. You can also ask them questions about it.
- The developers must also need to have a considerable amount of experience working with startups. Because every kind of business has its own way to work and operate. startups are full of risks and uncertainties as well as short on money. So, people associated with startups must work in a way where they can achieve more results using fewer resources.
Offshore Software Development Challenges
Through outsourcing your software development project to offshore companies is beneficial, it comes with its own set of challenges.
Time Zone Differences
Some of the most common IT outsourcing destinations are as follows:
- Latin America (Argentina, Chile, Brazil, Colombia, etc.)
- Eastern Europe (Ukraine, Belarus, Poland, etc.)
- South-East Asia (especially India)
It is hard to synchronize the time if your offshore development team is located in a different time zone than yours. You both can’t connect as when one will be online the other won’t. But if you pick the correct time zone then you can convert this challenge into a benefit.
For example, if you are in New York and hire a developer from Ukraine then the difference will be only seven hours. Besides, the Ukraine time zone is ahead of New York so when you wake up in New York, your team will have completed half of the day’s work pending for you to review while they will be doing lunch. Whereas if you choose a team from India which has more than 10 hours of difference and that too behind you. This will allow you to leave them instructions for the day’s work and sleep while they are working on your project. The working hours in India are more than in the US. So, it enables them to offer a 24*7 service to the clients.
Lack of Face-to-Face Communication
Offshore development lacks the factor of face-to-face communication or meetings. This can act as a barrier between the startup and the remote developers for the success of the project. But when there is a will there’s away. You can visit your offshore team from time to time (whenever it is of utmost importance) to meet your remote partners or employees to spend some time together to solve the concerning issues.
Such travels cost less than a failed startup. Or another cost-efficient way for face-to-face meetings with remote developers is video conferencing. But you don’t need to start directly through some work-related questions and problems. You should have a small talk about what is currently happening in the lives of your team members, especially amidst this pandemic.
Selecting the right fit from two or three options is an easy task but picking the one from an abundance of software development vendors can be a little frustrating and very confusing.
It is hard to choose among the thousands of software agencies that claim to offer the best offshore developers.
But you can always use the checklist given above in this article to filter the right kind of developers that fit your requirements.
It is necessary to understand the difference between the work culture of the startup and the outsourcing companies. As we have considered the similarities in the workflow, you also need to look out for similarities in the work culture between the two businesses. Otherwise, the collaboration would fail.
Hiring an offshore development team for a startup: FAQs
There is a lot of confusion over the topic and very little authentic information is available. So, I have tried to answer the questions of the business owners and startup founders in the section below:
What are the main advantages of hiring offshore development companies for a startup?
As we discussed, the major reason why startups fail is because of the lack of enough cash flow. And hiring offshore developers will be cost-efficient for the company.
It will save money for you to spend on the core aspects of the business.
Moreover, you can not only hire the top talented developers for your company at affordable rates but can also call your business global as the global team of professionals will be serving you so that you can serve the best for your customers.
What are the top offshore destinations for hiring software development services in 2021?
India is considered as the hotspot for the offshore development of software, website, and native applications for mobile. The companies here offer quality products within your budget. Many companies in India can serve as a one-stop solution for all your problems. However, the companies from Eastern Europe and Latin America are also competing to attract business owners across the world. They also have dev shops offering a wide range of software development services. The rate of development projects varies based on the geographic location but the quality has nothing to do with it. The companies and the developers are solely responsible for their work.
What collaboration tools are necessary when working with offshore developers?
But you can do it efficiently with the help of the latest and advanced project management tools.
But it is also important that you do it the right way.
The market is filled with collaboration tools for every task from pair programming to code collaboration and more.
You just need to choose the kind of tool that is the right fit for your remote dev team.
Should you hire an outsourcing agency or freelancers?
Offshore Software Developers. Now, this is one intriguing question. It’s the place where most people don’t often make a decision. Both the options can work for you. Freelancers charge less fee and if they can provide what you want then it will be right to pick them. But if you are looking for advanced technology infrastructure and high-level security, I’d say go for the dev shops out there.
Of course, many great freelancers can deliver more value than a small company with a team of poorly skilled developers. But not all are like them. There are only a few experts among the freelancers. Whereas in a dev shop, your work will be backed by the whole team of dedicated developers. They even have a standard operating procedure that one can’t guarantee to obtain from the freelancer.
I know hiring a dev shop can be a little expensive but you will get an organized and guaranteed work like good quality code, better documentation, efficient project collaboration tools, and your work is also more likely to complete within the predetermined timeline at a dev shop. But again, it’s all about who fits your project requirement.
Wrapping it up! Offshore Software Developers
I wrote this article to shed some light on the question of how to hire offshore software developers. Here, we discussed why you should hire them in the first place i.e. advantages. Then we saw what kind of preparation you need to do to hire software developers and where you can find them.
We also go through a checklist which is a step-by-step guide for the startup business owners to hire a software development company. It was also necessary to address the challenges coming along the way. And at last, we discussed some FAQs regarding offshore software development.
Offshore development has indeed proven to be the perfect choice for startups. In the last decade, the industry is booming while more and more entrepreneurs are using it to save time and funds while getting an MVP of top-notch quality. They are leveraging it to boost their business and now, you too can.
I have written this definitive guide to showing you how you too can do it. Comment down below if you liked reading this article. However, this article can just be a guide on the journey but only you can tell what’s truly good for your business. So, be wise and choose well. If you have further queries or suggestions then please share them with me in the comments section below.
Eric Peters is a part-time blogger and tech geek.
He loves to read and write on technology-related topics especially on various frameworks and languages.
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