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Startup Outsourcing Development – 10 Reasons Why You Should Do It Now

To outsource or not to outsource? There is a whole great amount of discussion and opinions on startup outsourcing development which makes startups founders even more confused in stage where they should be absolutely clear about things. Foolish and unnecessary if you ask me. If you think off-shore development center for startup is a bad idea ask Noah Kagan, ex Facebook employee about how he built AppSumo, a must visit marketplace for every startup founder.

There is no need to quote and cite external examples when here at Mobiloitte we have some great ones to highlight. Alex Prandecki, a startup founder and musician from San Francisco came to us with an idea.

getwithitAlex needed Android application development company that will help him build a product which will connect people on the basis of real live interactions unlike Facebook which has grown so massive, suffocating the connections that truly matter to us with random and temporary network that bring no value.

Alex had no experience in coding. He neither wanted to spend time looking for technical co-founder where in his mind, things were clear. Instead he looked for off-shore development center. He has found us and together we have built what is known today as GetWithIt.

So why startup outsourcing development is definite must for developers? Here are 10 reasons:

 1.   Startup outsourcing development keeps the cost down

In 90% of all cases establishing a startup is done while struggling for funds. Great for you if you can afford in-house team of developers (if you belong in the remaining 10%). Should those 90% give up and let their dreams wander in Ghost Town? Definitely not!  Off-shore development center can offer some pretty cool engagement models and pricing which can be up to 70% lower than in-shore or near-shore development center. This is exactly what Noah Kagan did and got from his team of developers from Pakistan.

2.   Professionalism and well established procedures

Off-shore development centers are blamed for lack of professionalism, unreliability, and non-existence of structure. Should I remind you that we are not talking about indie developers here? Most off-shore development centers have well defined workflow, communication protocols, engagement models and escalation procedures resulting from years of experience in off-shore development. It would take years of time and effort to established their programmatic approach and agility. Why not utilize their capabilities and bring that product to the market fast?

3.   Effective communication and follow up

Another typical attack against startup outsourcing development centers is their inability to communicate properly especially in English language. This could not be further from the truth. With exception of China which seems to put censorship even in the way Chinese people speak English, all other countries reputed for quality off-shore development for startups (particularly India) are fluent and well-versed with written and reproduction of English language. Their daily communication with startup founders and in-house solution architects keeps making them better.


 4.   Lack of time

Most development are tempted to do the development tasks especially if they are developers themselves. This is an entrepreneurial suicide. As a startup founder you must build your network, get out of the building, survey your target market and build relationship with investors. Prioritize your time because every second matters. You don’t want to be the fish which brews all the eggs in her mouth.

Here I have to share my story of a good friend of mind, a college dropout and founder of Daphnis Labs a game development startup here in New Delhi India.

Facing shortage of resources there was a time when my friend Sam had to do both – Coding (what he is specialized for)  and Marketing (what he had to do to get clients).  In the process he has experienced an amazing transformation. I quote him:

I have found it compelling and crucial for my success to do online marketing.  After a while I have actually enjoyed while blogging building, link baits, optimizing CTRs and Landing pages and Social media marketing. My interest in marketing and growth hacking kept expanding and I have decided to move completely from coding and dedicate myself to my newly discovered passion.

5.   Customer acquisition is expensive

Do not assume that just because you have written the code once, you will be able to quickly reproduce it in the next iteration and hence reduce the cost and the need for startup outsourcing development. It is pretty much probable that you will have to iterate significantly because you have discovered a different core feature that your niche would appreciate.

This could mean coming back to source code development and perhaps start all over again. Communicate your change quickly to your off-shore development center while you keep gathering market feedback. That’s what savvy entrepreneurs do.

 6.   Sitting across the hall is no longer necessary.

As I said above, it is a gift from heaven to be able to meet your developer across the street. Geographically close feedback loop is cited by several resources as most common reason why startup founders should not outsource product development. A totally misleading opinion if you ask me. I have seen my Android developers spending all necessary hours with their clients over Skype and Webex discussing over every possible feature, every possible screen design and every possible navigation pattern. The chart below (coutesy of @launchbit and @andrewchen) shows clearly that location is not a deal breaker when it comes to co-founding a startup.

startup outsourcing development


We are talking about a real time communication that occurs on every level of personal correspondence you can imagine.   What if you wake up at 5 o’clock jumping over a new feature that just came in your mind? Can you meet your developer that early without being thrown some curse? Unlikely. On the other hand your dedicated Android developer will be cheerfully waiting for you on the other side of the world, done with his lunch and ready to roll.

 7.   Overly ambitious startup incubators

Many developers are rightfully unwilling to relocate physically to startup incubators or having to give up equity in their business in order or utilize their network of mentors and consultants. Instead they want a quick SWAT team to come in quickly and cheaply make sure they are heading in the right direction.  This is another strong reasons for considering startup outsourcing development (thanks for this one @georgedeeb).

Fortunately most mainstream VCs are not that particular about in-house product development or incubation centers. If you have Paine as a backer, his answer is pretty straightforward:

Your objective is to get shit done. You build it yourself or you pay someone.  It doesn’t matter.

 8.   Access to exclusive tools

Many off-shore development center have premium access to expensive framework and development tools. They pay one time and use them multiple time for various product development projects and hence lower the cost of ownership. It is economically illogical to pay significant amount to purchase or subscribe for a tool that may be crucial for building your product but you will use it only one time.

9.   Quick consultancy

Who says that you have to order a service or book dedicated developer every time you consider off-shore development center? Why not examine the territory first?

Most off-shore development centers especially those with long track of successful projects possess unique knowledge of tools, technologies and methodologies. Many of our client have come with a requirement for a PhP back-end to end up with Ruby on Rails. Others have  come insisting on Android app and ended up happy with Cross platform solution that will help them capture another huge part of the market.

Ask for consultancy or best practices session over Skype. A good off-shore development center would not mind booking their Android or iOS champion for a 30 minute session with you with no strings attached.

10.   Flexibility and speed


Speed matters when developing and launching your product. Flexibility means simply that you have a few options to work with a team – from a time-based approach (milestone engagement model), where you are quoted on the time spend on the project by the team, to having a dedicated team (off-shore development center) to work only for your project for a pre-established period of time (thanks @Ahmet Aygun for elaborating so well on this)

Many off-shore development centers including Mobiloitte offer the option of create an initial test project for the chosen team, get it developed and measure the satisfaction metrics, before committing to a bigger investment.

Last but not the least a good startup outsourcing development center are well exercised in agile development methodology which enables it to maneuver quickly and respond to unforeseen scenarios quickly.

Are you a startup founder? Would you like to share your experiences in outsourcing product development for your startup? Do so in comments