How can I gain experience in outsourcing

9 IT Outsourcing Examples Every Startup Can Learn From


According to the IT outsourcing statistics from Computer Economics, outsourcing is growing in popularity: Large companies have increased their outsourcing spending from 6.3% to 8.7%, small companies from 6.7% to 7.8% and medium-sized companies from 4.7% % to 6.5%. In addition, nowadays there are more and more examples of companies such as Slack, Skype, Studytube, WhatsApp, TransferWise, Pricena etc. that are successfully using IT outsourcing.

The shortage of skilled workers is contributing to the growing popularity of outsourcing as it solves a number of problems - from reducing costs to the challenge of finding the specialists you need.


Almost 75% of all companies are currently outsourcing IT services, while 87% plan to continue or expand their outsourcing activities to the same extent. In the meantime there are clear indications of future outsourcing growth.

Your guide to nearshore software development in Eastern Europe

The software development market in 8 of the top target countries in Eastern Europe - Poland, Ukraine, Romania, the Czech Republic, Hungary, Bulgaria, Belarus and Croatia.

The Deloitte Global Outsourcing Survey 2018

Successful IT outsourcing examples: Companies that benefit from remote teams

Is Outsourcing Really a Good Idea? Will outsourcing service providers survive the next decade or not?

We examined 9 Successful IT Outsourcing Examples to see how world-renowned companies are using outsourcing to increase their competitiveness and to outperform their global competition by working with remote teams:

How Nearshore Outsourcing Slack helped break the $ 7.1 billion mark

Slack, a tool for collaboration in the cloud from the USA, was launched in 2013. It is currently one of the most popular tools that outsourcing owes its success to. For example, Slack hired the Canadian design team MetaLab to help them turn the beta version of the product into a success. In July 2017, the company achieved an investment of $ 250 million for a total value of $ 5 billion through external logo design, website design and development of their web and mobile applications. The last assessment in August 2018 showed that Slack hit the $ 7.1 billion mark.

Slack is rightly one of the best examples of companies that are successful in outsourcing. By trusting MetaLab for their beta testing, they were able to receive valuable feedback that helped them develop a tool that reached 15,000 users within two weeks of launch. In May 2018, the number of users was already more than 8 million, with even large companies such as IBM, BBC and Oracle using Slack in their daily activities.

WhatsApp employs offshore software developers in Russia

In 2012, WhatsApp only had 30 full-time and 5 part-time employees in its small office in Mountain View. However, this did not prevent WhatsApp from becoming one of the most popular and world famous chat apps. Just three years after its launch, the app was downloaded over 50 million times. In 2014, just two years after it started, the company was sold to Facebook for $ 19 billion.

With little start-up capital (the first round of investment was just $ 250,000), WhatsApp had to keep its operating costs down. To develop the product and bring it to market, the company turned to Eastern Europe to find much-needed IT talent. WhatsApp worked with offshore developers from Russia because "there are excellent engineers there," as co-founder Jan Koum notes.

Most of the in-house staff concentrated on customer care and operations, while development was carried out abroad. While WhatsApp initially employed a large part of its engineers abroad, it later brought some developers to the USA.

Citigroup is cutting 11,000 IT related jobs to be outsourced offshore

As one of the world's leading American financial services companies, Citi has been outsourcing its technical operations since 1992. The company has several offshore locations in India, the Philippines and Poland. Additionally, in 2012 Citigroup reportedly cut 11,000 jobs at its headquarters, at least a quarter of which were IT-related jobs. Most of Citi's IT operations are now conducted offshore.

In addition to the so-called “Centers of Excellence” (offshore development centers operated by Citigroup), the company maintains ongoing relationships with a number of outsourcing service providers, including TATA Consultancy and Wipro.
Citigroup is not the only bank that has relocated its technical skills abroad. Other well-known examples are Bank of America, Barclays, Goldman Sachs, and J.P. Morgan.

Klout founder moves to Singapore to build an offshore development team for his product

As the original influencer ranking platform, Klout is a startup that has benefited greatly from offshore development. Joe Fernandez, the founder of the startup, traveled to Singapore and hired a custom development team to bring his idea to life. He lived there for 4 months and worked closely with its developers to develop a beta version of the product.

The first version of the product was funded by Joe himself, his friends and family (his starting capital was only $ 200,000). In just under four years, however, the company had raised a whopping $ 40 million in funding and was sold to Lithium Technologies for $ 200 million in 2014.

Why do German companies develop their software in Ukraine?

Find out about the state of the Ukrainian IT market and why Ukraine is an attractive location for IT outsourcing.

TransferWise relies on a distributed team of Ukrainian developers

According to TransferWise, a global money transfer company, they do not use any "offshoring, outsourcing or advisory services". However, the company admits to having a number of “independent employees” who are an important part of the core team.

The company's distributed development team is located in Estonia and Ukraine. The company is particularly active in working with Ukrainian developers from Lviv in the western part of the country, and some of the developers who worked for the company in the early days are moving to Estonia to join the TransferWise core team.

Marek Unt, Head of PR at TransferWise, has often said that Ukrainian professionals are valuable because of their "quick technical grasp and engineering training".

StudyTube employs remote software developers in Ukraine

StudyTube, an online education platform, also relies on nearshore programmers. The start-up based in the Netherlands initially relied on freelancers. However, the company soon realized that the approach wasn't suitable for developing a solid product. For this reason StudyTube decided to find the necessary development capacities nearshore and employed Ukrainian developers. The startup already has three investment rounds totaling € 1,500,000 and continues to grow.

Stepan Suvorov,
VP of Engineering at StudyTube

"Our team in Kharkiv is made up of reliable people who write high quality code. Now that our internal processes are well established, we are happy with how the remote model works."

Read more about StudyTube's experience in this outsourcing case study.

Mobile offshore developers have helped Pricena's Android app get over 50,000 downloads on Google Play

Since 2013, Pricena has been providing users with accurate pricing information on electronic equipment and home appliances in stores in the United Arab Emirates. In June 2015, Pricena entered into a partnership with Daxx to hire mobile and full-stack developers to help develop iOS and Android apps as well as the web version of Pricena.

This collaboration was so successful that Pricena was named online startup of the year in November 2015, and its Android app achieved over 50,000 downloads and 4.3 stars on Google Play.
 

Haneen Dabain
Founder of Pricena

“The offshore developers are my full-time employees. You take part in all business activities, we solve problems together - it is not a short-term partnership. When you work with developers full-time, you can be sure that they are doing their best to achieve high quality. "

Read the full offshore case study.

How a nearshore team helped TenderApps non-technical entrepreneurs bring a technical product to market

TenderApp, a Netherlands-based intelligent bid management platform, launched in January 2019. Thanks to the collaboration with a nearshore team of 4 developers, the entrepreneurs, who themselves have no technical background, were able to develop a new product from scratch, implement functions and prepare the product for its successful market launch.

 

Marcel Hazeleger
Shareholder of TenderApp

“Offshore cooperation is not just about reducing costs. It's also about having good people for the project and making sure everyone is happy with their work, which is difficult to achieve in the Netherlands. I think it's good that our Daxx team is really fully focused on our project. Since it is not working on multiple projects at the same time, there is no need to set priorities. That's really valuable these days. "

Read the full offshore case study.

Oktopost, top software for social media and content marketing, works with nearshore developers

Oktopost, a platform for social media management, has been around since 2013. At that time, the team was active in 3 countries and comprised 22 people - 14 in Israel, 3 in Ukraine and 5 in the USA. In 2018, they hired Daxx software developers to help Oktopost expand their development capabilities and increase their business agility - something they couldn't have done without the recruiting of this talent. The main benefit of an outsourcing development center is access to a larger pool of available talent.

 

Liad Guez
Oktopost Co-Founder and VP Product

"I can safely say that offshore development has helped us expand our capacities and develop things that we just couldn't do before."

Read the full offshore case study.

Daxx helps you to gain positive outsourcing experience

With Daxx you keep control of your software development project and work directly with your own team of talented software engineers. Our process is simple:

  • Describe your needs and staffing requirements - it is up to you whether you work with just one developer or a whole team.
  • Interview candidates, and employ and manage the software developers of your choice with the tools and methods you prefer.
  • The team starts working under your management, while our HR program minimizes departures and keeps your team happy.
  • Focus on the development process while we take care of all labor law matters, taxes, office management, HR, etc.

If you want to explore cooperation possibilities, please contact us via our contact form, or have a look at our available developers.