In the fast-paced world of 21st-century tech, there’s a critical juncture in the life of any successful tech startup: when you realize you need to hire more software engineers.
This can happen at the very beginning of your startup’s life or after you’ve been at it for a while, but either way, the decision can be daunting. How do you know which roles to prioritize? Does it make more sense to hire full-time staffers or to hire an outside firm to provide you with people? Should you give them equity? Should you get people in your home country or hire internationally? Do you need industry experts? How senior should the hires be? There’s a long list of important questions to consider.
Identify what needs to get done, then consider who can best accomplish this
You need to know what needs to be created before you go out in search for the right folks to build it. What has sparked the current need? Have you just signed a huge new client? Did you just close a funding round? Are you trying to increase your development speed? Are your current engineers freaking out and saying that they just can’t get it all done without more help? Step one is usually clearly identifying what the development goals are. This isn’t easy. A lot of startups over-hire or under-hire and don’t have the right team in place to do what needs to be done in a cost-effective way.
Once you’ve figured out your roadmap and development goals, it’s time to determine who you need to add to bring your vision to life. Do you need a full, well-rounded team with an architect, team leads, front-end and back-end engineers, UI/UX design, DevOps, QAs, BAs, etc.? Or do you just need a few targeted people with certain skills to augment your existing team?
Create a few job descriptions that not only explain what you’re looking for in new team members but also what kind of responsibilities these people would need to take on in your company.
Don’t forget about the soft skills, too. Though they’re often forgotten in the tumult of the tech world. But abilities like good communication, team thinking and team management, conflict resolution and the like all play a key role in a successful software project.
Also think about where the developer needs to be based. If you’re OK with a remote position, that opens up a much larger candidate pool than if the position’s going to require them to come into the office regularly. And in the latter case, location is everything — you’ll find a lot more programmers for hire in San Jose, California, or, say, anywhere in Latin America, than you would find if you need the person to be in Pierre, South Dakota.
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Think about the practicalities
What’s in your budget, and how quickly do these new developers need to get new projects running? As you look over your hiring possibilities, you must keep in mind that an employee’s salary is just the beginning of the cost of hiring them — you’re also sinking money and time into the recruiting process itself, have to pay their benefits, taxes, pay for office necessities like hardware, software, other office equipment and supplies and possibly desk space, and then wait around for them to be onboarded properly.
So, when you’re preparing your budget for this new developer, you have to look beyond the simple salary and think about the real budget for this new person. Multiplying the base salary by 1.5 isn’t a bad place to start, though that figure could easily climb upward and crawl downward depending on your location and other factors.
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Consider the the long term
Though it’s natural to want to snap up some amazing React Native coders when you’re launching your first mobile app, you have to think of what your long-term plan is. If it doesn’t involve a lot of mobile besides just the basics of a mobile app, then investing in a lot of developers whose specialty is a language that centers on mobile doesn’t make a ton of sense. And if your company experiences an unexpected contraction, you’re going to have to make the tough decision about whether or not to initiate layoffs.
On the other hand, if you expect to get deeply into mobile down the line, having a number of mobile developers makes a lot of sense. But if you hire them before you’ve laid the groundwork for your mobile ventures, then you have a bunch of expensive programmers sitting twiddling their thumbs.
A lot of non-technical founders hire full-stack generalists and figure that those developers can “do it all” when it comes to development. While there are some fantastic “do-it-all” folks out there, many of the best engineers prefer to specialize in specific areas. As a startup grows, it is usually necessary to have a balance of both generalists and specialists.
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Do you want to outstaff or outsource instead?
Consider another option, such as outstaffing, in which you augment your current staff with developers from a third-party organization. Or think about outsourcing, in which a third-party company does pretty much all the development work on either a component of your platform or even the entire platform.
An outside firmis a way to get the benefits of in-house developers without any of the added hassle of bringing on full-time employees.
You get a global talent pool: You won’t have to worry about scouring the local job boards for local software talent. Instead, depending on the company you partner with, you’ll be pulling from the cream of the crop of the entire world, with the best possible mix of diversity of skills, experiences and backgrounds to contribute to your project. (Assuming, of course, that you’re OK with remote work from programmers, in most cases.)
The outstaffing firm takes care of the paperwork: No more filling out government tax forms, enrolling in benefits or the stack of necessary filing that has to be done with each new hire and that can consume an HR department’s days. This is all handled by the partner company.
You save money: All that invisible overhead of benefits, hardware, etc? You don’t have to worry about it (the partner company handles that). You pay exactly what’s written in the contract, without having to worry about hidden costs.
You save time: No waiting around for onboarding — outstaffed programmers can often start work on the same day as the ink dries on your agreement. And you don’t have to snap up devs way too early just to ensure you have the right people on board when your project is ready to roll — it’s the outstaffing company’s job to make sure the best team is on hand at the appointed time.
It’s easy to scale up or down: Third-party software developers and outstaffers are designed to make it easy to add on more people (or peel them away from a project) as needed. Plus, if you’ve found a third-party developer you really love, then there’s always the possibility of a long-term partnership that’s essentially like gaining all the benefits of adding on full-time software specialists without any of the headaches.
You save on precious equity: Third-party companies usually don’t expect equity grants the way your full time employees will.
You avoid the risk and reputational damage of layoffs: If you need to pivot in the future and get a different talent mix in the door, you won’t need to fire your employees. Instead, just ask your partner for different engineers.
Outsourcing and outstaffing aren’t always the right choice for every startup, but if you feel that it could be the solution for you at a critical point in your growth, reach out to Plan A Technologies to talk about how we could contribute to your success!
