Outsourcing 101 for Startup Founders

By Aymeric Gaurat-Apelli
Founder, Task Army

Many people are attracted by the idea of outsourcing but starting outsourcing can be quite daunting. Where to find the right people? How to make sure they will produce the results you expect? How much to pay?

I will try to answer these questions in this (lengthy) post.

I. Where to go to find a remote contractor?

There are different approaches you can take, all with pros and cons.

I.1 Local forums
You can post your job to local forums. For example, if you are looking for someone in the Philippines, you could go to local Filipino job forums.

Pros: cheaper, there is no middle man.

Cons: it is riskier because you have no way to access previous customers feedback and ensure the provider will be good. You will have to spend more time making sure the provider is qualified.

Example of websites:

I.2 Placement services
You can use placement services that will find a the right service provider for you.

Pros: Quality is usually higher.

Cons: Expensive because of the overhead of finding the providers for you.

Example of websites:

I.3 Outsourcing marketplaces
On these websites, you post a job and service providers submit their quote in some kind of auction. Quality varies from a marketplace to another. Elance tends to be best to find quality providers but is more expensive. These platforms can be a bit overwhelming because you receive 100s of applications that you have to filter through.

Pros: Many service providers for a wide range of skills. It is good for bigger projects when you want to ensure the quality of the service provider and to make sure the provider has the right skillset.

Cons: Unnecessary and overwhelming hiring process for smaller tasks.

Example of websites:

I.4 Micro-job marketplaces
You can buy services like if you were at the supermarket. The services offered are well defined and small.

Pros: Depending on the size of the task you need done, this is a good compromise between removing the overhead of finding the right provider and yet not adding a huge extra cost.

Cons: Works only for smaller tasks.

Example of websites:

  • Fiverr (be careful with what gigs you buy, you might get penalized by Google)
  • TaskArmy.com (focuses on tasks that will improve your website and online sales)

Note: TaskArmy.com goes one step further by manually approving the services and service providers to remove all the crappy services.

I.5 Niche websites
Some websites focus on a specific kind of experts or services.

Pros: They usually make the process much easier or the quality of the providers is much higher.

Cons: If you hire more than one contractor with different skillsets, you will likely have to manage them across different platforms.

For writers

For designers

For developers

  • ODesk is usually the best place.

II. Hiring process

II.1. Favourable criteria
Country of origin: Based on my personal experience, I tend to prefer people from Philippines for general assistance and from Eastern Europe for development: you have a higher chance to get someone reliable and honest.

Responsiveness is essential. If someone takes two days to answer your emails, it will slow the project a lot. Timezones are already challenging, having someone who is not online most of the day is an unnecessary pain.

English skill. Depending on the type of task, you don’t need perfect English (except for writers). You just need to make sure they understand your English, ask them to re-explain what you have given them to work on in their own words.
For a writer, be VERY picky with their English. If they don’t capitalize their “I”‘s (as in “i am” instead of “I am”) for example it is a big red flag. Also, if you can find typos in their conversation with you, it is another red flag. A good writer must be anal when it comes to typos and good grammar.

II.2 Outsourcing the hiring
Hire one or two people from Philippines for $3/h to help you hire someone. Ask them to post your job on the different websites I cited above and to filter the good from the bad based on the criteria you give them.

I found my own Ruby on Rails developer this way and we have been working together two months and I canít be happier. It costed me $20 to get two people look for a developer for me.

II.3 Some more tips on how to hire

  • You can decide to pay the service provider to take a specific test on oDesk. They have a wide range of tests for all disciplines.
  • Verify they have done similar work or that they have the skills required
  • On Odesk, you can look in the history of closed jobs. You can find closed jobs similar to yours and approach people who got a good feedback directly
  • Give a mini project. The mini project should be totally independent to not have to give away too much and yet should be useful to you. It shouldn’t be bigger than a week worth of work though to waste any time if youíd decide not to go ahead
  • Go with your gut: if you feel the provider isn’t responsive or you have a bad feeling, move on, you are probably right.

III. How much should you expect to pay?

I assume here that you outsource offshore:

What How much
General assistance
(link building, customer support, web research, etc…)
$3/h up to $10/h
Developers from $12/h up to $30/h for great developers
Designers Outsourcing design is tricky because usually you want Western web 2.0 style (a la 37Signals) and it is hard to find someone offshore. This is one thing that I would consider doing onshore.
Writers Articles you buy at $5 won’t get you natural links from the readers but will help with organic traffic from Google. To get better quality articles that readers will actually like, it will start at $20 per article up to $120. The higher the cost, the more following the writer should have to help promote your content.

IV. Recommended virtual assistants to start outsourcing now

If you want to try your hand at outsourcing, Iíd recommend starting with small tasks to slowly acquire the outsourcing mindset and make it second nature. Karissa and Joni are two virtual assistants on TaskArmy that I recommend if you want to start outsourcing.

Any questions?
I will be following the comments so please don’t hesitate to ask me any questions in the comments.
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Aymeric is an French entrepreneur based in Sydney (Australia) who has founded TaskArmy.com in 2009 to make outsourcing online easier. If you’d like to share your lessons learned, domain knowledge or relevant product (translated out of Marketize), how about doing a guest post for 47 Hats? Email me.

Comments

  1. I think one of the key problems with outsourcing software development is that people tend to think of software development as one thing. I wrote about this in my blog just yesterday after watching a talk by Dan Pink about extrinsic vs. intrinsic motivators: http://www.workingsoftware.com.au/page/The_reason_that_outsourcing_software_is_so_difficult

  2. Thanks Aymeric for the mention and for the great effort you put into creating this eye opening resource on oursourcing and working with Virtual Assistants for startup entrepreneurs.

  3. Thank you for this. I didn’t realize that there were so many different approaches for finding contractors. Outsourcing the hiring task itself is something I never even considered.

    The rules of thumb you outline are also appreciated.

    Mike….

  4. @Owen: thanks to your masterclass with Mixergy where I learn a thing or two that I added in this article. Link to masterclass: http://unbouncepages.com/outsourcing-effectively/

    @Michael: Glad you enjoyed it. I think nowadays people understand what outsourcing but the main barrier is to understand what they could do with their remote staff. Outsourcing the hiring process is a great way to leverage outsourcing.

  5. I’ve had some success with outsourcing and this article has nailed a lot of the things you should do to avoid any nasty situations.