I am about to create my first tech startup, it is a simple project that could be entirely outsourced. My fear is based primarily on the future of the startup. If the project takes hold, how to deal with the transition from external to new hired engineers? How to handle this situation?

I have very successfully built businesses on an almost entirely outsourced model.

One company I have has 6000 clients across Australia, New Zealand and the UK. We outsource the sales team on-shore and the product delivery & customer service off-shore.

Firstly its a decision based on wants and needs - "I like the idea of a particular business but don't want to deal with staff/customers/operations etc" - so understanding what you don't want do, helps you align what is worth outsourcing.

The key with outsourcing is use multiple providers for both the same functions and also the different functions.

If you only have one provider for a function you are always at risk of either rising prices or not lowering prices or being held to ransom in some way or another. When you have at least 2 providers you can always negotiate the best outcome using fear of loss and then the 'well our other provider is doing .... for us, can you please do the same?'

You are the secret source that holds all functions together if you are outsourcing say design, marketing & development - make sure you use three separate providers.
A) they won't want be able to replicate without you,
B) they won't push one department in a direction to make it better for another department.

Hit me up if you want to chat further. The model can rally really work for both growth, profit and lifestyle.

Answered 8 years ago

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