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Outsourcing a Software Development Team in 2023: A Comprehensive Guide for Startup Businesses/



Michael is a software engineer and startup growth expert with 10+ years of software engineering and machine learning experience.

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Outsourcing a Software Development Team in 2023: A Comprehensive Guide for Startup Businesses
Outsourcing a Software Development Team in 2022: A Comprehensive Guide for Startup Businesses


  • Why should you hire an offshore software development team for your startup?
  • Should you skip an in-house and consider an offshore software development team for outsourcing?
  • When Starting a Business, Why Hire Offshore Software Developers?
  • The Advantages of Hiring an Offshore Development Team
  • Outsourcing Software Developers: Where to Start?
  • Finding a Developer for Your New Business
  • Where to Look for the Offshore Development Team
  • Difficulties in Outsourcing Software Development
  • How to Find the Perfect Offshore Development Team For a Startup?
  • Conclusion

Offshore developers are in demand and will help startups grow in fast-paced economies. We’ve shown you why hiring software development teams from abroad and where you can find them makes sense. Offshore development is the way to go if you want to get a product to market faster without sacrificing quality.

Why should you hire an offshore software development team for your startup?

Imagine. After months of effort on your product idea, you realize you need to change direction. You’re sure you must create an innovative product or feature to prove your idea’s worth. You have one month to construct something fresh and present it to venture investors at Demo Day. You’ll definitely need technical assistance with this feature or product. Don’t worry—hire an offshore development team.

Should you skip an in-house and consider an offshore software development team for outsourcing?

The answer, in our opinion and analysis, is yes. But before we reveal all the strategies you need to know for hiring overseas, you should keep in mind the following basics for making it in the fast-paced world of a startup:

  1. Co-founder conflict is a surefire way to ruin a firm before it even gets off the ground. Harvard Business School professor Noam Wasserman claims that this is the primary reason why 65% of firms fail.
  2. Don’t waste time; get things done immediately. For a startup company, product release pace is of the utmost importance.
  3. Put out a reasonable amount of money. Startups are funded once an MVP (Minimum Viable Product )validates your business model. Thus, it’s vital to stay under budget when building the MVP.
  4. Keep the standard high. Keeping the right pace, cost, and quality for your MVP is essential.
  5. Save money by taking advantage of remote employment (particularly considering everyone works from home during the COVID-19 pandemic).

Sounds difficult, right? It is. But if you hire developers offshore, you can use all the above references to make an MVP that will impress investors.

When Starting a Business, Why Hire Offshore Software Developers?

Startups have evolved. Startups face more competition and a shrinking market window. Co-founders struggle to balance quality, affordability, and speed. Startups in high-cost developed nations find this difficult, making outsourcing appealing.

The Advantages of Hiring an Offshore Development Team

1. Having Access to a Huge Talent Pool

Even the best recruiters have difficulty finding competent and qualified developers to fill open positions. Changing your focus to developers offshore allows you to draw from a large pool of skilled software developers. The chances are high that you can discover developers with the necessary skill sets at an IT firm overseas.

2. Increased Efficiency and Fast Recruitment

Offshore developers can cut expenses and speed up development, saving time. Startups are born in a competitive environment, so time is critical. You won’t have to train new hires with a dedicated development team because each outsourced developer is skilled. A vendor development business will handle project management and HR chores, including personnel retention, saving you time. You’ll concentrate solely on work.

3. Flexibility and Scalability

Offshoring allows businesses to keep their operations streamlined, which is especially beneficial for new ventures. Offshoring will enable you to tailor your collaboration with developers in other countries to the specific requirements of your projects. There is no obligation to sign on for a lengthy period, which could hinder a company, especially in its earlier stages. Depending on how rapidly your firm expands, you can increase or decrease the size of your development staff as needed.

4. Cost-effective Development

Quartz says 37% of firms fail due to a lack of funding. Hiring offshore developers eliminates this risk. You won’t have to spend your money on office rent, salaries, insurance, vacations, hiring fees, etc. Instead, you will put the money into the most crucial area: making an MVP.

Furthermore, hiring a local developer is difficult because they often demand hefty compensation. In the United States, a software engineer can expect to earn an average of $107,510 per year. Most new businesses have few resources. Thus they often hire programmers offshore to keep expenses down.

Offshoring to countries with lower living costs allows companies to create apps for a fraction of what it would cost in developed countries.

5. Work with Experienced Software Developers

App development involves significant risks. Even with a good developer, a mismatch between an app and company goals can fail. By hiring offshore developers, you can find people who have worked on projects like yours. They will help you avoid common problems and improve your chances of success.

As you can see, working with software developers offshore can help your startup run more efficiently.

Outsourcing Software Developers: Where to Start?

Check on this list before considering any developer recruitment for your startup:

Get your business objectives straight and be ready to share them.

Before outsourcing your development team, you should define the problem you hope to address with your first minimum viable product. Your next step should be to identify the most critical product objective, divide it into manageable chunks with clear metrics, and assign rough due dates.

Take a look at the experience level needed for the task at hand.

The first step in completing any project is accurately assessing the technology stack(s), knowledge, and required skills. The next step is determining who needs to be involved in the project and what they will do. E.g., Can you get by with just developers, project managers, quality assurance specialists, or business analysts?

Make a budget plan.

Every new business needs to plan its budget down to the last cent to avoid common pitfalls. Determine how much money you need to start and where you may cut costs without sacrificing quality. It’s essential to find potential investors in advance to whom you can present your minimum viable product.

Get information about offshore countries. There is a lot to choose from, and each has its pros and cons. Make a list of the countries closest to you in terms of time zone and culture, and think about which has the best price-to-quality ratio for offshore development.

Finding a Developer for Your New Business

After you’ve completed all of the requirements, it’s time to move on to the next level and recruit development teams. Here are some places where you can find a dedicated development team for your startup:

  • Referrals from people you know
  • Meeting people at events like conferences, hackathons, and meetups
  • Freelance portals
  • Tech talent marketplaces
  • Using social media or LinkedIn to look for offshore developers or teams
  • Using the services of software development companies in other countries
  • Local Recruiters
Outsourcing a Software Development Team in 2022: A Comprehensive Guide for Startup Businesses

Where to Look for the Offshore Development Team:

South America, Asia, and Eastern Europe have emerged as leading offshoring destinations due to rising demand for IT outsourcing.

South America

South American countries are offshore powerhouses because of their closeness to US entrepreneurs. IT outsourcing is driven by Brazil, Argentina, Chile, Colombia, and Mexico. These countries had over 500,000 IT experts in various disciplines in 2020, and this number is expected to grow.


Asia is recognized for app development outsourcing. At least 4 million IT specialists are ready for any regional project. Cost drives Asian outsourcing. Indian app developers earn $20,000 per year, compared to $60,000 in the US.

Eastern Europe

Ukraine, Poland, Belarus, and Romania dominate IT outsourcing. Cost, talent, cultural and language compatibility, and workable time zone make the region ideal. Eastern European developers’ consistency, quality, communication, and punctuality make up for their lower prices.

Difficulties in Outsourcing Software Development

Your startup can benefit significantly from hiring offshore developers, but you should be aware of the following difficulties before making any commitments:

Adjusting for Different Time Zones

If your offshore development team is located in a different time zone, finding a time that works for everyone may be challenging.

Inability to Communicate Directly with One Another

“Offshore” means “in another country,” so there will be a specific barrier between the startup founders who work in-house and the developers who work in another country. But there is a way to fix this: you can make occasional trips to the offshore team’s location to meet your distant colleagues in person, have some fun, and get to know one another better.

Too Many Market Options

There are advantages and disadvantages to choosing among the many software development suppliers available on the offshore market. You’ll have difficulty picking from the thousands of firms offering to help you hire offshore developers and gain their trust. You could make the wrong choice even if you spend a lot of time researching potential outsourcing partners on various online marketplaces.

The Impact of Cultural Diversity

If you can, hire offshore developers whose culture is similar to yours. So, you won’t have to spend extra time learning about and getting used to the new culture. You could also hire a few dedicated software developers from the same country or region. This would speed up the work process and make communication easier for everyone.

How to Find the Perfect Offshore Development Team For a Startup?

When outsourcing app development, you will be spoiled for options. The success of your startup depends heavily on the quality of the team you build. It can be challenging to tell which developers are qualified for the job.

Here’s a step-by-step guide that will take you through the process:

Step 1: Determine what your new business needs.

Clearly define the features of your project and the expertise a developer needs to succeed. It’s essential to consider a wide range of factors, such as the nature of the project, the location, and the desired method of collaboration.

Step 2: Ask for recommendations.

Check their website ranking, see if they have a profile on different job sites, and find out which clients they have already worked with. If you can, get in touch with some of their past clients and ask if they would recommend this remote team or developer.

Step 3: Check out reviews online.

Believe nothing you read on the website of the offshore IT firm. Check their claims with actual customer feedback. This necessitates a look at third-party review sites.

Step 4: Find out how the outsourcing development firm handles projects by asking them about their workflow.

Learn about their client interactions and how they assign programmers to projects. If you need extra developers for your project, you should find out if they can scale up. It’s crucial to determine if the development company’s workflow will work for you before hiring a remote workforce and signing a contract.

Step 5: Don’t go with the cheapest bid.

Think of ways to cut costs rather than spending more. It’s possible that going with the lowest bidder could end up costing you more in the long run if another developer ends up having to fix the cheap quote’s shoddy work.

Step 6: Determine if the distant team fully accepts your suggestions or if they would instead argue.

It should serve as a red flag if the developer or software development business guarantees they can meet all of your needs. This indicates that they have not taken the time to learn about your requirements and determine whether or not their capabilities match up. Unless it’s a scam, you can’t expect a web development company to meet all of your needs without making some adjustments.

Step 7: Identify an efficient method of project management.

Collaboration tools simplify offshore development. Long emails are outmoded in project management. Use Slack, Jira, Trello, etc., for project management, tracking, and collaboration. Thus, you can easily track your team’s progress, lead discussions, make comments, and get to the point.

Step 8: Don’t wait around; take the initiative.

One of the most important “soft skills” for a business founder is initiative, especially when collaborating with a remote development team. If your remote team members are up and working while you’re asleep, getting a jump start on tomorrow’s tasks is crucial. So, when you wake up, you can rest assured that everything is still where it should be.

Step 9: Demand on regular deployment.

Typically once or every other week, have your offshore devs present you with a demo of the MVP after the sprint is complete.

As a final step, check that your team:

  • Can follow directions and complete tasks. It’s preferable to deal with all the problems at once rather than try to fix everything afterward. Raise the issue if you feel they are only telling you what they think you want to hear.
  • Has to experience with your industry and a track record of success with at least one project like yours.
  • Performs well in fast-paced environments and has worked with startups before.


Hiring a development team offshore is ideal for a software startup. Thus, startup businesses can save time and money while receiving a high-quality minimum viable product. To choose the best startup developer, you need first clearly define your needs, identify the appropriate skill set, create a budget, and explore offshore locations. In addition, you should be aware of the difficulties that may arise from working with developers in a different time zone, the absence of direct personal communication, and potential cultural differences. Slashdev is a key player, and we can help you with these. Please contact us at slashdev.io.