Paris, they say, is always a good idea [especially since they’ve just won the World Cup]. True story. In much the same way, outsourcing is always a bad idea, in my humble opinion.
It never ceases to amaze me the amount of requests for outsourcing “partnerships” that float my way with organizations asking me if we want to utilise their services, especially from developers. My answer is always simply a polite thanks but no thanks.
Why not? Because we never do outsourcing (or whatever such partnerships maybe called) and we advise anyone against it. It’s a great loss of time and energy within a pointless business model where developers don’t get their fair share of value created. We believe in a different kind of business model.
No outsourcing please, we’re believers
Many tend to believe that one of the factors explaining the success of our Starttech Ventures portfolio companies is the low cost of software development. The “competitive cost structure” we often hear. This is the same line of thinking that leads many American and European companies to outsource software development to places like India, Bulgaria, Romania, Ukraine, and so on.
Well, it is definitely true that software development costs in Greece and the East Mediterrenean has always been low. And they went even lower at the height of the financial crisis. However, it is even lower in Bulgaria and perhaps even more in Belarus. So, how come a great product like TalentLMS come out of Athens instead of somewhere like Minsk. It’s not like the development talent isn’t in abundance.
The answer lies in that what makes the Athenian ecosystem unique. The availability of both exceptional software development and product marketing talent at relatively low costs. Oh yes, and the fact that agile teams in Athens (no more than a handful of people) carry out product development working in the same location. This means interacting both with formal and informal methods.
And what is the result of this? Productivity simply skyrockets, and this is why you can see capital efficient, healthy startups such as TalentLMS and Yodeck doing so well, with experienced investors often describing them as “unbelievable” examples.
Quality can start [and end] at home
Last but not least, one should never underestimate the cultural aspect. For example, it’s not only the costs in Athens that are much lower than somewhere like New York City or Silicon Valley. You can also find both product and tech talent for a new or fledgling startup, who can work closely in the same team or physical location. This, as opposed to dividing the teams between a time difference of 10 hours via outsorucing which creates incredible barriers to productivity.
Moreover, in a place like Athens, these teams can be largely composed of people with a fairly international mindset and culture. This makes it so easy for them to understand the customer, and generally the target audience without facing any kind of cultural barrier – something which often destroys outsourcing projects.
Believe in yourself
It’s always something easier to say than do, but at the end of the day, if you simply believe in yourself and your team, it’s amazing how far you can go. Sometimes that is the hardest step. But trust us, we do just that, year in and year out. We believe. And work with full dedication toward the goals we set ourselves.
So say no to outsourcing. The best investment is that which you make in yourself. And for us, that means right here, in Greece. Because there’s never been a better time to do just that.
