Over the last few years, the tech talent shortage has been a dominant theme in staffing and recruitment circles. According to Korn Ferry, the global shortage of technology professionals is forecasted to reach 85.2 million by 2030. 

This, in turn, is estimated to contribute to an astounding loss of $8.452 trillion in unrealised annual revenue. 

As a result, it can become overwhelming for startup founders and small to medium-sized businesses (SMBs). They are tasked with accelerating time to market to have a competitive advantage, so the lack of talent complicates matters very quickly. 

So how can startups and SMBs deliver scalable digital experiences? How do they get their products to market and accelerate customer acquisition?

The answer to the question depends on your budget. 

If you’re lucky to have significant venture capital funding, for example, you will be well-placed to compete in the labour market for top tech talent. 

You might even have an advantage over multinational corporations as you can offer a fresh challenge along with similar remuneration packages. But most startups don’t boast budgets that can compete with the likes of Booking.com or Checkout.com. 

Those without enviable budgets can hire a couple of developers and bootstrap the project together. You can pay them what you can and offer equity until your business becomes profitable (which can take years). 

But finding affordable developers can prove to be a massive challenge in a fiercely competitive market.  Even if you manage to do it, development can take a long time and delay your time to market

So now what?

Outsourcing Model

Outsourcing your development project can help you build your digital product quickly and cost-effectively. 

The whole process will look something like this:

• Identify an outsourcing partner with a proven track record
• Provide your development project requirements
• The outsourcer builds a team and roadmap to develop software or mobile apps
• You engage with your outsourcing partner at different milestones
• You end up with a finished product

This approach enables access to top tech talent while saving you time and money. However, the primary disadvantage is the fact that your involvement will be limited. 

As your outsourcing partner will manage the entire development project, you’ll be in the dark during each iteration. This can lead to misunderstandings and delays that will hinder your plans and impact your bottom line.

When you’re not actively involved in the development project, there’s a risk of not finding out about problems until much later. This, of course, will be time and resource-intensive.

Steve Martin, Founder and Executive Managing Director at Pace Harmon, provided a great example of how outsourcing projects can derail. In this scenario, it was a telecommunications project where internally managed operations were outsourced from North America to India. 

In this scenario, the South Asian outsourcing partner didn’t understand the business model and didn’t know what they were coding. Development took much longer than expected and took even longer to figure out what went wrong and fix it. 

In this example, the contract was cancelled, and the American telecommunications provider had to engage in a public legal battle over costs. This reaffirms the fact that there are many variables to consider and manage, so you can’t partner with an outsourcing provider, sit back, and wait for them to deliver.

According to Martin, “the contract was executed from a business perspective, where it looked great, but not enough thought was given to how to programmatically move to the new environment.” 

Extended Team Model

The extended team model ensures that you build a robust digital product on time and on budget while maintaining complete control of the project. This is because your team extension provider will have remote programmers that work in concert with your in-house team (with you in the lead). 

Building software and mobile apps with an extended team looks something like this:

• Identify an established team extension provider
• Provide candidate requirements for your project
• The company puts together a shortlist of candidates with a few days
• You interview potential candidates and choose the ones that fit your business model and culture
• The extended team provider managers all the HR and overheads
• Your extended team members become a core part of your team for the duration of the project or for as long as you need them

This approach can help you quickly start scaling your business because you’re on top of the development project and can start preparing to scale your business.

How the Extended Team model helped a rebates management startup win the first enterprise customer 3 months after the MVP launch

e-bate, for example, had a positive experience following an extended team model. The planet’s first SaaS-based Rebate Management Platform was able to provide more control over rebate management and disrupt how businesses manage contracts, transact, reconcile, and analyse customers and suppliers to maximise margins.

According to Duncan Burns, Customer Success Manager at e-bate, “e-bate was struggling to hire qualified software development talent locally in the UK, so we decided to expand our search beyond it. Besides talent shortage issues, we were completely dissatisfied with the quality of many local developers who were legacy-bound, stuck behind just one stack and were inflexible when it came to career advancement and learning new technologies. To prevent our development project from getting stymied, we started exploring different outsourcing destinations.”

By accessing Evolve’s pool of top tech talent in Ukraine, e-bate was able to quickly build an MVP and test its viability and attract  £1 million in funding in just eight months. Three months later, the company was able to attract its first enterprise customer. 

Burns added, “we have successfully gained traction in the market, won some significant large customers, gained investment and are now scaling up to meet the demand. Stakeholders are really impressed with our speed to execute” (and you can read more about the e-bate use case HERE).

On average, it can take anywhere from 18 to 24 months to develop and deploy a digital solution. With team extension, you’ll be well placed to implement it in less than 16 weeks.

How an award-winning fintech startup used an Extended Team in Ukraine to speed up time to market and customer acquisition

Once upon a time, Hastee, a UK-based startup changing the way contingent workers get paid, realised they didn’t have internal expertise and bandwidth to future-proof their business idea fast enough before making a substantial investment in its development. As such, they turned to Evolve for bespoke software development. Since Hastee didn’t want to lose control of their outsourced project, we offered them to set up their own Extended Team in our Kyiv-based R&D Centre. To ensure smooth team integration and bring it up to speed, we delegated our CTO Colette Wyatt to act as an interim CTO on the project.

Twelve weeks later, Hastee’s Extended Team delivered an MVP which included the native mobile app designed for both Apple iOS and Android devices plus a whole bunch of microservices. Four weeks later, Hastee launched their pilot solution (or MLP–Minimal Loveable Product), which allowed them to win the first clients pretty quickly.

In general, Hastee’s Extended Team journey took 24 weeks from ideation to the commercial launch. Had they chosen to develop in-house, their time to market and customer acquisition would have extended up to a year, as the local hiring time typically exceeds 50 days.

Wrapping up, an Extended Team model proves to be an alternative and effective way of speeding up time to market and customer acquisition accordingly due to access to a largely untapped pool of software engineering talent nearshore or offshore and external know-how that can be too expensive or hard to find in the local market.

As you will be leading each iteration, you’ll also benefit from having a total view of the application development cycle and its potential to disrupt the marketplace. 

At Evolve, we provide high performing Extended Teams that build award-winning solutions. If you would like to learn more about our team extension services and our Ukraine-based R&D Centre, request a call back now!