How Smart Startups Stretch their Funding
When startups reach the key milestone of securing Angel or Venture Capital, their new partners are looking both for a series of deliverables but also a great return on their investment. One of the many questions they ask during the pitch process is generally ‘how long before you’ll need another infusion of capital?’ They love it when the response is … “a long time.”
Once that infusion is safely secured, how do smart entrepreneurs make the most of it? STRETCH. Find the best value for the money on every project. And that includes custom developed software.
In the early 2000s, the key to this savings was to off-shore development. Fast and inexpensive services sprung up across Asia and Eastern Europe, putting hundreds of thousands of software engineers to work… outside of the US.
“Americans are just too expensive,” was the cry.
What we learned, however, was that it’s not really American developers that are so untouchably expensive, but the US major cities that pushed up the prices. The developers in rural areas and small cities are actually quite affordable. Plus – they speak your language, understand your culture, and live somewhat near your time zone (if not in your time zone).
Entrepreneurs often judge the viability of outsourcing based on hourly rates they are paying. This can be misleading. When you pay for the least expensive person to do the job, you seldom get the best. Then you wind up paying more for senior team members to work through the problems created by the less-experienced.
Here are three other ways that the whole can end up bigger than the sum of its parts (ie: it’s more expensive to offshore than it looks):
- Miscommunication = Time Lost: Yes, they speak English. No, they don’t understand your colloquialisms, the cultural impact of the work or how it relates to the industry as a whole. So when the project is delivered, it’s wrong or incomplete. Re-scoping, re-scheduling, re-writing. All take more time, and as a start up it could cost you that window you have to beat your competition to the market
- Intellectual Property in Lost & Found: When a team of developers works on your project, they get to know your business and understand how the software gives you a competitive advantage. More profoundly, they are actually creating some of your intellectual property. It appears to us that keeping your IP in the US is pretty critical.
Where you are does make a difference. If your developers are in major cities with high cost of living, you’ll simply spend more than you will when the teams live in places where the cost of living is lower. It’s just logical. And it’s been proven out time and time again on projects we’ve delivered.
But it’s not just the cost of the developer. It’s the cost of your time. That’s why we encourage you to take advantage of our US-based developers, and keep from going:
Time Zone Zany: I’ve never met an entrepreneur that wasn’t exhausted. Burning candles at both ends, they manage their business, their product, their employees… they have a hard time managing developers who live 12 hours away.
Partner Panicked: I’ve also never met an investor who preferred that the code she just invested in be developed or stored over seas in a distant land, subject to different law and different court system.
Just because you need to stretch your investment dollars, don’t cheap out on software development. Be responsible. Keep development in the US by working with rural and small city teams. Consider the whole of your investment, and give us a call.
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Software in a Different Language
In an earlier blog post we discussed the benefits of custom software to help businesses establish a
competitive edge. Yet designing, testing, installing and training can be a significant battle for the team
Organizations quite often conclude that their in-house development team is either already overworked
or that they don’t have the necessary skills required to complete the project. Coders and app developers
have specialties, generally in different languages like HTML, Java Script, C++ -- the list goes on. If the
new system calls for Python and that’s not in the programmers’ wheelhouse, you’ll likely outsource the
Outsourcing in the US likely means the computer language is the primary concern. Outsourcing offshore,
however, will invariably add a few layers of complexity to the project, including the spoken and written
language. Having your team work in different development languages is one thing. Having them try to
understand a second language and envelope that into the system may be the breaking point for a
Dialect, Accent, Colloquialisms
When folks from the northeast move to southern states, they often found themselves having a hard
time understanding the accent, especially in the deep south. Are they hearing a foreign language? Even
those with a rather well-developed ear, who’ve traveled extensively ask people to repeat themselves.
There are so many English dialects that misunderstandings occur regularly. Accents among Americans
are difficult enough but add accents of English speakers from across the globe and it’s likely that the
work to decipher meaning can confound situations. Non-native speakers often slip into the sentence
structure of their native language and confuse inferences due to colloquial speech and slang that
dominate today’s communication style.
A friend of one of our co-workers lives in Poland. His Facebook feed recently had a cute picture of a child
and a description written in Polish. Not speaking Polish himself, he decided to use one of the many
translation apps available. Apparently, the way it was translated made our colleague shudder that his
Polish friend was speaking so negatively about his son…
Of course, when asked directly, the translation software had not interpreted the comment correctly.
Imagine a situation like that when teams are trying to work on projects as complex as a software system.
It’s not enough to outsource to an English-speaking team. Communication among those working on the
project can make or break its success, so consider the clarity of working with an astute team here on US
soil. Don’t let any part of your system get lost in translation.
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You Know PHP... But How's Your .NET?
For years your team has developed hypertext-based solutions. For both internal and client applications, you guys can rock you some PHP.
But the challenge has changed – and now you need to develop for Windows. You look into a framework that will support a series of different languages – you need access to a huge library that can share with multiple applications.
You need .NET.
But you don’t know .NET, and neither does your team. You can learn it… it’s not rocket science and your team knows C# and VB... besides, they’re really keen. But, you don’t have an extra month.
You need a .NET expert. Someone that will know how to get the Framework right, how to apply the appropriate tools.
What you don’t need? To go through a hiring process. To sign someone on who has the skills you need for a short-term project. To get the project clearly laid out.
One of the great things about having PS Solutions as a partner is that we’re ready to help. We have a hefty team that’s facile with:
… and a whole lot more.
We’ve worked in manufacturing, healthcare, finance, retail, transit, HR… you name the industry, we’ve likely coded for it.
So don’t stress. Just call PS.