Want to start your startup while cutting costs?
Building software in-house is super expensive, really time-consuming, and for many, it just takes more than one talent.
But if you had asked Google, WatsApp, Slack, GitHub, or countless other successful startups, they would tell you that Outsourcing was a great thing to have used at the early stages of the product development.
In fact, 70% have increased their software outsourcing.
And the above statistics only tell half the story. Let’s get into all the different advantages that Outsourcing brings to the table when building a Startup.
What you’ll discover:
- Why Startups Need Outsourced Software Development
- Cost Savings That Actually Matter
- Access to Top Talent Without the Headaches
- Speed to Market Advantages
- How to Scale Without Breaking Your Budget
- Risk Mitigation for Early-Stage Companies
Why Startups Need Outsourced Software Development
Building a tech company from the ground up is hard enough. Having to worry about building a development team from scratch is a losing battle.
Hiring developers seems like the obvious solution. But what founders don’t realize is the hidden costs that come along with it.
When you start hiring developers, you need to account for all the recruiting and hiring costs. On top of that, you need to take care of their onboarding, benefits, insurance, equipment, office space, and management overhead.
Let’s just say you’re not paying for the developers, you’re paying for a whole developer support team.
But outsourcing changes all that.
Instead of getting stuck in the hiring process or worried about onboarding a team, you’re instantly given access to a team of battle-tested developers from our pool of specialized global developers.
These are the teams that have been building products and building developers from scratch for years. No recruiting headaches. No onboarding and training periods. Pure magic from day one.
The developers that you would end up hiring will probably take months of headaches before they can start building the product you actually need.
But it’s too late by that time because your competition has already shipped features and gathered user feedback while you’re still hiring developers.
Cost Savings That Actually Matter
Ok, let’s start talking numbers, because I know you care about them too.
The cost savings you can find from outsourcing software development can be up to 40% lower than in-house rates.
But there are so many other areas where you’re saving money too. Let’s break it down.
- Recruitment and hiring costs
- Employee benefits and insurance
- Office space and equipment
- Training and onboarding time
- Management overhead
- Payroll taxes and legal compliance
But the cherry on top of the cake is that with outsourcing, you can scale your developer team on a per-project basis.
In other words, there is no developer sitting around waiting for work to be handed to them when things are slow in the office.
The life of a startup can be chaotic, but your outsourcing budget doesn’t have to be.
Access to Top Talent Without the Headaches
Ok, did you know the world’s best developers don’t actually work in Silicon Valley anymore?
They’re distributed globally, working for top companies and for top-tier outsourcing companies all over the world.
These outsourcing companies have already done the hard work of finding, testing, and training world-class developers. It weeds out all the bad candidates.
What this means is you’re able to access the developers that have:
- Built products for Fortune 500 companies
- Expertise with the latest technologies
- Experience in rapid scaling
- Delivery track records
They’ve already gone through the testing and development. What’s left is for you to pick them.
Speed to Market Advantages
Time is money in the Startup world.
McKinsey actually found that outsourcing can reduce time-to-market by up to 25%. The difference between beating your competition and losing market share.
Why is outsourcing so much faster? Well, these teams have seen it all before. They have experience in building these types of products so they know the common pitfalls.
They will know which technical solutions work and which ones are going to give you nightmares down the road.
How to Scale Without Breaking Your Budget
Ok, when it comes to traditional hiring, it’s like buying a house if you just need a hotel room.
You make huge upfront commitments without knowing for sure what you’re going to need for the long term.
But outsourcing is like a flexible hotel lease that grows and shrinks with your business needs.
- Need to add some features for a big client presentation? Scale up for a few weeks.
- Waiting on your next funding round? Scale down and preserve cash.
- Need to expand into international markets? Add specialists who speak those languages.
This level of flexibility is gold for startups trying to find their way in uncertain waters.
Risk Mitigation for Early-Stage Companies
Ok, let’s be honest here, the majority of startups fail.
But outsourcing actually mitigates your risk in several key ways.
Technical risk: What if you build your product in a technology that you’ll need to switch from in the future? Experienced teams have seen this all before. They know which technologies have a good track record and which ones are troublesome.
Talent risk: What if your lead developer quits a month before your scheduled launch? Outsourcing means you’re working with a whole team instead of betting the company on a single developer.
Financial risk: All of the above equates to lower upfront costs. Which means you have the cash to spend on marketing, sales, and other business growth activities.
Time risk: Proven process and experienced teams will result in less delays and missed deadlines.
The Strategic Advantage
Ok, hear me out here. Outsourcing is not just a way to cut costs, it’s a strategic advantage.
Every time you get pulled into managing developers, reviewing code, or fixing technical issues, you take your eyes off the ball.
The most successful startup founders obsess over focusing on what only they can do. Everything else gets delegated or outsourced.
Your job is to build a business, not a development team.
Making the Smart Choice
Ok, the data is in. The stats have been broken down. The benefits are clear. But the question now isn’t whether you should consider outsourcing, it’s whether you can afford to not.
Let’s remember some of the big tech companies and startups used Outsourcing to get to where they are.
- Google used outsourcing to build their initial infrastructure
- WatsApp only had 32 people total when they were acquired by Facebook for $19b
- Slack outsourced their initial development
These companies all understood the same thing that many founders are just realizing now: Outsourcing is not a shortcut, it’s a strategic advantage.
Wrapping It Up
Outsourcing software development for your Startup is not just a way to cut costs. It’s a strategic weapon that can make or break your path to success.
Ok, all the advantages of Outsourcing aren’t just limited to software. The cost savings alone are massive.
Access to top talent with no hiring headaches, faster time-to-market, flexibility and scalability, less risk, and a strategic advantage to outsourcing.
The companies that win are not necessarily the ones with the biggest budgets or the most developers. They are the companies who make smart choices on how to allocate their resources.
And in today’s landscape, outsourcing software development is not only a smart decision, it’s THE smart decision.
Ready to take the next step?
Stop burning cash on developer recruiting, onboarding, and training headaches and start building the product your customers want.
Your future self will thank you.