As an entrepreneur and software developer, I have had the opportunity to work with many young startups as they go about building and forming their companies. The early, heady days of getting your business off the ground entail long hours, wearing multiple hats, and making fast decisions; it also means prepping for and raising funds, hiring non-technical staff, designing and building the product, and of course, finding those first customers. With so many important details on your plate, one key consideration is determining what activities to keep in house and which ones can and should be outsourced, such as technology implementation.
For example, while you may eventually have the structure and resources to warrant hiring a CTO, that might not be the wisest decision as an early-stage startup, where everyone needs to be totally hands-on. You’ll want coders, no matter what their title, and you’ll want them fully on board to realize your vision and take the company down the right path. In this scenario, the advantages of outsourcing are obvious: You get the software engineers you need, only when and where you need them, without the commitment and equity demands of an on board hire. At a shop such as PromptWorks, where every member is a battle-tested, seasoned pro, you get the added benefit of senior experts well-versed on developing a wide variety of solutions. It’s like getting a whole team of CTOs for whatever technology issues and goals you face.
Outsourcing your MVP lets you keep your capital and have a better chance at technical success. In-house developers hired by startups often lack the expertise necessary to make elegant solutions quickly. They try to make up for it with long hours, but there’s no substitute for experience. What’s more, it is only a matter of time until these home-grown MVPs require major rework, and ultimately get replaced by well-designed solutions that can scale and deliver as the startup grows.
How do you select the development partner that is right for your organization? Here are some best practices and lessons learned that can guide you through the selection process:
• Remember specialties matter: Not only do you want to select a partner that has experience building the solutions you envision, but also you need to kick the tires to ensure the partner has a strong track record of building products especially for startups.
• Budget realistically: You get what you pay for and a proposal coming back at about $50,000 is probably too good to be true. Depending on the scope of your first version, expect to spend $100,000 – $500,000. Additionally, make sure you have enough cash left for marketing.
• Respect the project management triangle: You can’t have effective software development without the cost, time and scope push/pull of the fundamental law of the ‘iron triangle.’ Make sure your development shop is up front with you about it. A good shop will help you prioritize features and try to do less in order to save your capital and hit your milestones. Our experience with early-stage startups shows less is more.
• Keep a tight feedback loop: A good Agile shop will be delivering continuously, so you can try out new features every day. You should also be able to watch user stories move across the Agile board daily and can find out the status of a feature without having to interrupt a dev. Additionally, every sprint you should get a demo of working software that’s ready to be rolled out to production with just one click.
• Have an exit strategy: Make sure you can switch development shops quickly if it’s going badly; have a backup partner from your initial search on speed dial. If you selected the right partner, they’ll want to make you self-sufficient in the long term. At PromptWorks, for example, we usually help startups interview and hire their development team, and we pair program with the new in-house devs for weeks/months to train them on the technology and the domain knowledge so they can maintain and enhance the software we’ve built.
In your early startup days, relinquishing technology development to an outside partner at first may make you feel you are losing control. But time and time again, entrepreneurs realize they can’t do it all. By selecting the right development partner you actually gain more control of this important area, get freed up to focus on mission critical company-building activities and stay on track to reach your intended goals.
