Why Forward-Thinking Startups Are Outsourcing Their Tech Projects
Exelaration partners with lots of companies, but recently we have noticed an undeniable shift in our client base. A new type of client has emerged – the startup – and it’s no surprise that we love working with them. We’ve built software for nonprofits, Fortune 500 companies and federal agencies. No matter who it’s for, […]
Exelaration partners with lots of companies, but recently we have noticed an undeniable shift in our client base. A new type of client has emerged – the startup – and it’s no surprise that we love working with them.
We’ve built software for nonprofits, Fortune 500 companies and federal agencies. No matter who it’s for, software development is interesting, rewarding work because every client challenges us to make their mission come to life through technology. When a client asks you to build something that will recruit thousands of more volunteers or to shrink a credentialing process from two months to three days, you jump on board with the fervor of a bounty hunter. They dare us with “can you build this?” and we tell them how much and how long… that’s when our startup clients tell us they need it yesterday for half the cost.
We love working with them, but a more interesting question is why do they love us? We asked them, and some of their answers surprised us. We learned that it’s not just us; in fact, startup CEOs are outsourcing their IT projects with increasing regularity. We compiled their reasons, and boiled them down to a list of six Fs:
Focus. Close your eyes and picture the typical CEO. You’re probably imagining a talking head on CNBC explaining why profits were down, or a power suit-wearing captain of industry presenting a jumbo-size check to a non-profit. Now picture a startup CEO. The former image morphs into an impassioned spokesperson explaining why their idea will change the world. Startup leaders routinely context-switch between finance, sales, recruiting, and marketing. And all of that is usually done before lunch.
With all this juggling, one commonly accepted key to success for entrepreneurs is knowing what to say no to. Focus and prioritization are rightly heralded as skills to be sharpened. Startups who don’t focus end up saying yes to too many things, going to too many meetings, and doing everything themselves. When your killer product depends on technology, you can’t delete your IT, but you can engage an expert partner and hold them accountable. We’ve inherited code built by company founders, and after that first fearful turnover, they realize that a trusted expert can build their vision while they focus on making sales and hiring rock stars.
Fractionality. Startups need unvarnished tech advice from a loyal expert. So, why not hire a CIO? Two issues arise with that approach: one is that CIOs are expensive. The other is that most startups don’t need a full-time CIO. The service our clients are most surprised by is this one. A trusted tech partner provides the sage advice that only an experienced technologist can offer. Should you put this in the cloud? Are you painting yourself into a corner with this architecture? Buy this or build it? These are key questions that have wrong answers that can kill a startup. A trusted tech partner provides the value of a startup CIO before you hire one. This isn’t just true for the CIO role: a startup can have similar needs for fractional contributors in other positions like security officer, data/privacy officer, and product manager, all of which can be well-filled with a qualified tech partner. Exelaration is particularly strong in this area, since our clients have access to the full complement of all our experts who are active in multiple developer communities, giving them access to a host of university, community, and industry resources.
Flexibility. Startup technology needs are frequently volatile. Our clients dial their support needs up and down rapidly as funding and business requirements evolve. When startups use scarce dollars to hire their own permanent IT team too early, they find that the uneven workflow creates a dangerous cycle of burnout and downtime for their team. Our diversification across multiple clients gives us the ability to scale our client teams up and down to meet client needs. The uniqueness of the Exelaration model is that when our clients begin to staff their own IT teams internally, they can tap Exelaration student engineers as future hires upon their graduation. These engineers are already well-versed in their technology and environment and are engaged in the mission.
Finding talent. Folks who don’t work within the IT industry are often shocked at the industry’s “churn.” High turnover and low retention is a way of life in the tech sector and it isn’t changing. Some statistics show the problem getting worse as demand heightens and mobility increases. What keeps technologists staying at a company longer is impactful, meaningful work and cutting-edge technology. Top engineers like to work for top tech and consulting firms, and it is difficult for a startup whose primary mission isn’t technology to attract and retain tech talent. Some of our clients tell us it’s hard for them to employ technologists because they expect bigger raises and tech perks (like laptops and certifications), and they still get called every day by headhunters looking to lure them away. The smartest startups are the ones who invest their hiring dollars in their home domain (health care, energy, finance, architecture, etc.), and don’t enter the combative world of technology recruiting too early.
Funding. Venture capital is flowing! We know because we see our clients accessing multiple streams of investor funding from a diverse set of sources. As startup CEOs know well, outside funding comes with scrutiny. Investors want to see a solid growth plan, and, most importantly, they want to see consistent achievement of that plan, quarter after quarter. If development of the killer app slips or the IT spending skyrockets, the tough questions come and the funding gets pulled. Confident technology estimates and answers from seasoned technology experts give investors the transparency and realism that leads to successful product launches and software that dazzles users.
Fluency. Software development has become ubiquitous, and it won’t be long before everyone’s top second language is Java. Exelaration celebrates (and contributes to) the spread of this wonderful skill across the world’s population. But just as in every field, expertise is worth gold in software development, and it does not come instantly. Agile best practices, SOLID principles, test-driven development, and continuous delivery are a few examples that separate professional developers from amateurs. Experts adhere to them because they work; that means fewer bugs, lower maintenance costs, and less time to production. Fluency is the most frequently cited reason our startup clients give for why they partner with Exelaration, and we’re proud of that.
Our job is to let our clients shine for the meaningful missions they’ve embarked on. Some of them are already incredibly successful, and some are still building their first product release. No matter what, startups are where tomorrow’s answers are being incubated and cultivated. The Exelaration team is ecstatic that we’re working with so many of those dynamic startups to build those products. We love that they appreciate the power of our own unconventional model that combines the fluency of expert mentors with the potential of tomorrow’s engineers.