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Here’s the brutal truth. It’s extremely difficult to hire developers for a startup, particularly an early-stage one. With a bare-skeletal structure, a startup is sometimes run by a one-man-team and in no position to compete with established companies in terms of perks and salary.
Even if it does, developers often pursue their careers at established organizations, where the conditions and benefits tend to be more stable and provide room for growth.
But fret not. In recent years, many early-stage startups have turned to an alternative form of recruitment. They outsource their development needs to 3rd parties. Companies like Slack and Whatsapp are popular names that outsourced their development when they were just starting out.
Outsource development has become a norm in the industry. In 2018, 37% of small businesses outsourced their business processes, and the figure is expected to rise. Interestingly, 60% of the outsourcing workforce are IT personnel, which speaks volumes of IT outsourcing demand.
In this article, we’ll guide you on finding the right developers for your new startup and leveraging the outsource development model for your benefit.
Key Motivation Drivers for Startups When Looking to Hire Developers
When you’re hiring developers, you need to have a pre-defined idea of how the recruits could add value to your startup. You must list your priorities carefully because a startup couldn’t afford the wrong hires, outsource or not.
Here are valid reasons for you to hire developers for your startup.
Set up the tech stack for startups
What are Node.js and Golang? The former conjures up a giant snake for most startup owners, while the latter sounds like a jewelry brand. For developers, they are part of the technologies used to build a mobile app.
It’s quite common that startup owners have little or no knowledge of app development. Their job as an entrepreneur is to turn ideas into problem-solving software and not figure out how to do programming.
Therefore, a startup must recruit the right developers familiar with the tech stack needed to build the app.
More than 3,400 apps were released to Google PlayStore daily in December 2020. That’s how competitive the app market is. For a startup, you’ll want to get your idea out there quickly, test it out and refine it. It all has to be done at rocket speed.
If you’re banking on trances of funding for your startup, you’ll need to have something to show to the investors. And that means building an MVP.
You’ll need a team of developers if you want to make quick progress as an early-stage startup. Even if you’re a talented programmer, you cannot get distracted from managing the business development as it would divert your attention from other areas of your business.
Staying within budget
Cash is the lifeblood of early-stage startups. Whether you’re bootstrapping or armed with capital from investors, you need to be meticulous in your expenses. And that includes hiring developers.
You have no choice but to be stringent in your selection process. It’s a matter of picking the right candidates who will get the app to the market with as few hiccups as possible. This means choosing a developer with substantial experience, particularly in building apps related to your niche.
The pressure of making the right hire within the limited budget is felt when the bargaining power is not in your favor.
Build a strong team
You can’t operate with a skeleton structure for long. Even if you’re a good multitasker, there’s only so much you can take on in a startup. You’ll soon need to delegate tasks to your team members, including matters related to IT development.
Therefore, you’ll want to look for candidates that share your startup goals and values to build a team of developers as you move forward. It’s better to have the team handling the development from the start than bringing them into the startup at a later stage.
A strong team is one that’s familiar with the product and business processes. That’s the idea that drives startups to hire developers.
Challenges of Hiring Developers for a Startup
Every startup owner wishes for a dream team of developers to turn their ideas into working applications. However, they have to face the harsh reality of recruitment, that brings unwanted challenges to their startups.
These are the common complaints when you need to hire developers for a startup.
Lack of local talents
The world is getting more digitized. Large and small businesses scramble to move their operations online. This causes a surge in demand for IT professionals. Unfortunately, the growth in local IT talent falls short of the surging demands.
New startups are often at the losing end when scouting for candidates in the market. Talented developers are quickly snapped up by large corporations. When you have a small pool of candidates to choose from, hiring becomes a tedious and expensive process.
You can’t hire just for the sake of filling up the team. As a result, you’ll have to wait months or years before landing the right person. That’s a timeline that’s unacceptable for the fast-paced world of startups.
Retention benefits competition with large corporates
Even if you’ve landed some promising IT developers in your team, there’s no guarantee that they’ll stick with you long enough to complete the project. Not when so many large corporations are poaching them.
It’s all fair game for big companies to tempt developers with perks that are way beyond the capability of budget-tight startups. At the end of the day, you’ll need to match the benefits offered or lose good developers that you’ve brought in after much effort.
Losing people in your team disrupts your schedule and can put you back for months. If you intend to re-hire, you’ll also need to fork out additional expenses for job ads and interviews.
Hiring a developer is a significant financial commitment. Usually tied by limited budgets, startups are more susceptive to financial expenses. Not only you’ll have to pay for the developer’s salary, but also perks like social security, annual leaves as required by laws.
Your developers will also need to keep abreast with the current technologies, which means you will need to pay for upskilling and certifications. As a whole, the expenses of hiring full-time developers can be unbearable for startups.
Even when you’ve launched the app and minimum support is required, you’ll still need to pay all the developers’ salaries on your team.
Attempts by startups to hire good developers are further hampered by the lack of brand credibility of a new startup. You can have lofty ideas and goals, but a new startup is often associated with a lack of stability and lower salaries for the candidates.
This is further complicated when you’re in urgent need of a developer, and you don’t know where to look for him/her. A startup doesn’t have the luxury of an HR department, which does all the headhunting and interview processes.
It’s hard to put on the HR manager’s hat when you’re running a budding startup, which is why startup owners are looking elsewhere for developers.
Benefits Of Hiring Remote Developers For Startup
Instead of hiring in-house developers, many startup owners outsource their IT development needs to remote developers. Here’s why.
Tech Talent Availability
When you’re outsourcing, you’re no longer constrained to the local pool of talents, which can be quite limited. Instead, you’ll have the luxury of choosing the best IT developers from around the globe. For example, Eastern European countries like Ukraine have a large pool of talented developers to choose from.
Outsourcing not only brings you the best of talents but also spares you from the long-term commitment of a permanent hire. With the risks faced by an early-stage startup, it’s reasonable to engage developers on a project basis.
Hiring for full-time positions requires more considerations than deciding to hire remote developers for a startup. With the former, you’ll need to consider if the candidate has both the hard and soft skills to fit in the startup for years to come. It isn’t easy to find such candidates nor reach a decision.
However, outsourcing to a remote developer is much simpler. All you need to consider is whether the particular developer has the required skill sets to take on the current project. You don’t have to worry about whether he/she will fit into the company’s long-term plan.
To build a functional app, you’ll need expertise in different areas. For example, you’ll need an Android and iOS developer to build a native mobile app. You’ll also need a backend developer to develop the backend software.
With remote outsourcing, you can choose developers with the skills needed to get the job done. There’s no worry about long-term financial commitment as the contract is only for the project. Besides, you can bring in more developers when there’s an increase in the workload.
Make the best of your budget
Being thrifty is a virtue much-needed for a startup owner. You’ll want to make every expense count, and that’s where outsourcing IT development fits in. Unlike a full-time hire, you’re not obliged to pay fixed salaries, allowances, equipment, software, and training.
Outsourcing is also economical when you’re based in a country like the US or UK. Hiring local IT experts is expensive compared to outsourcing to developers in other countries. For example, you can hire developers in Eastern Europe for a rate between $25-$50, and Asia for $18 -$40. What’s important is there isn’t any difference in the deliverable’s quality.
More experienced and expertise
The chances of building a successful app increase as you hire developers with relevant experience for your startup. By outsourcing, you can choose developers who have developed similar apps. It prevents rookie mistakes, which can affect the development timeline.
The global pool of IT developers consists of professionals who specialized in different fields. You get to pick the best lineup to build your app with minimum fuss. These experts need little hand-holding and get into top speed right from the start.
7 Steps To Hiring Developers For a Startup
When you need to hire developers for your startup quickly, you need an action plan. It spares you the time of going through rounds of pointless interviews or, worse, hiring the wrong candidate. Here’s a step-by-step guide to doing so.
Step 1 - Specify your business needs
Every startup is unique, and that includes the type of hire you need to make. Take time to ponder on why you need to get an IT developer on board. Are you kickstarting a new app idea and in need of developers to quickly develop an MVP?
Or are you looking for iOS developers to bring an app to the Apple marketplace? Some startups may already have a core development team working on their apps but may need additional experts familiar with new technologies. For example, you don’t have a data streaming specialist in your team, and outsourcing to one is the best option.
Your list of requirements will dictate the type of developers you need. It’ll give you a better idea of where to start searching and how much you’ll need to pay for their service.
Step 2 - Determine the employment model
Once you’re clear with your business needs, you’ll need to decide on the type of employment model for the outsource developers. That’s right. There is more than one option available.
If you’re working on a small project, you’ll want to consider the project-based model. This model suits projects that have pre-defined requirements, and developers are paid a fixed price. However, there’s a lack of flexibility as it doesn’t suit projects with evolving requirements.
If you’re yet to have a concrete idea of how your app will be, you’ll want to go for the dedicated team model. As the name implies, you’ll be assigned a team of developers who work exclusively on your project. The developers will be contracted to your startup for a specific period.
You’ll have better flexibility working with a dedicated team. You can communicate your ideas directly to the team and receive quick feedback. There are also no limitations on making changes during development.
Now, if you already have an in-house team, you’ll want to go for the third option, the extended team. It’s more of filling the skill set gaps by outsourcing to IT specialists. Your in-house team is in charge of coordinating the development, while the outsourced developer takes on the specific tasks.
Step 3 - Choose a country to hire from
It’s important to hire developers for startups from the right country. Some countries are cheaper than others, but factors like language barrier and timezone are concerns. Ideally, you’ll want to outsource to developers that could communicate in your language, are good at what they do, and don’t come at an exorbitant price.
These days, the ideal outsourcing destination in Ukraine. You can hire an IT developer for $30-$50 per hour and get good results. Also, Ukraine comes out top amongst the 3 popular outsourcing countries in Eastern Europe.
Step 4 - Finding necessary specialists
Before you can hire a developer for your startup, you need to find the candidates. It can be overwhelming if you don’t know where to search. You could end up liaising with employment agencies, which can be costly and may not always fulfill your requirement.
For startup owners, it’s better to search on your own. Talent marketplaces like Upwork, Freelancer, and Guru are the best places to start if you’re looking for developers who work with different collaboration models. You can decide whether to pay by the hour or per tasks assigned. Such platforms allow you to filter candidates by skill sets, which helps bring the right experts to your team.
If you wish to work with a dedicated team, you’ll need to check out sites like Clutch and SoftwareWorld. Clutch allows clients to leave reviews on IT development agencies they’ve engaged, so it’ll be a great place to start finding reputable agencies. SoftwareWorld provides listicles of top IT development agencies according to type and region.
It also happens that this article is published by an experienced IT development agency that may solve your hiring needs. Feel free to get in touch with the editor with the types of developers you’re seeking.
Step 5 - Verify the expertise
Whether you’re hiring freelancers or an IT development agency, you need to be diligent in checking out their background. You’ll need to ensure that they have the expertise as claimed and can handle your project.
If you’re hiring through platforms like Upwork and Guru, browse through the reviews left by other clients for the freelancers. Ask for a list of projects that they’ve accomplished. It helps you to filter out candidates that are missing vital skills needed on your project.
Take the same approach when you’re hiring an IT outsourcing firm. Read through the testimonials given by past clients, and if possible, talk to them for direct feedback. Browsing through the company’s profile on LinkedIn can also reveal much about its reputation.
Besides expertise, you also need to ensure that the developers possess soft skills like communication, teamwork, and being anticipative. Much of the success relies on clear communication between you and the developer. Ensure that language isn’t an issue and there’s a common platform to exchange opinions.
When hiring a dedicated team, you expect good teamwork from the developers. They need to be self-organized and capable of tackling issues independently. The candidates need to be proactive in making suggestions and reporting issues without being prompted.
Step 6 - Conduct interviews
How do you ensure that the candidates have all the hard and soft skills for the job? Nothing works better than holding an interview. Have the candidates talk about their experience working on previous projects. You’re able to learn whether they are passionate about what they’re doing.
Make a list of questions to evaluate the candidate’s response when placed in tough positions.
Run through the questions with each candidate and compare the responses. It helps in choosing the best candidates who perform well under pressure.
Step 7 - Start the job
When you’re satisfied with the shortlisted candidates, you can then award the job. Ensure that both parties mutually agree to the terms stated in the contract. Provide clear requirements on what needs to be done and issue the start work order to the developer.
How Uptech Helps Startups With Their Development Needs
For years, Uptech has been helping startups that are hiring developers for their projects. We have a proven process that guides startup owners through identifying their needs to executing the idea itself.
We start by gathering the client’s requirements and evaluate the complexity of the project. Our team then turns the requirements into executable tasks. The tasks are broken down into parts and assigned to our team of developers.
Once we have a solid plan, we’ll hold an extensive discussion with the client. When both parties are satisfied, we commence the project on an agreed schedule with a formal contract.
Our team is known to be proactive in providing ideas and feedback. This is evident in our collaboration with the Yaza team. Yaza was coined as a social app that lets friends share places of interest through a visualized map. However, it lacks clarity on what problem it is solving.
We conducted a market and customer validation exercise and found out that it is best suited for the real estate industry. Based on the results, Uptech proceeded to build Yaza in the determined direction.
Uptech’s knack for producing results does not go unnoticed with Sprent. Sprent has existing iOS and Android app but is looking for a reliable partner to improvise its backend, admin panel, and apps. Amongst 4 IT vendors in Eastern Europe, Sprent has chosen Uptech as its development partner.
Early-stage startups have it tough when it comes to hiring developers. There isn’t much room for startup owners to navigate to find the best developer for their team. We’ve shown how outsourcing is a viable option and provided a step-by-step guide to find the right developer.
If you don’t want to go through the hassle to hire developers for your startup, drop us an email on your hiring needs, and we’ll be glad to assist.