Successful Companies That Outsourced Their Software Development
Companies outsource development for many reasons. They might wish to lower costs, use niche expertise, get a different perspective, or tap into a more flexible labor pool.
Some of the most successful companies that have outsourced some of their software development include:
Outsourcing is a common practice among companies of all shapes and sizes.
It is a myth that only small or budget-strapped companies outsource their development. On the contrary, many of the largest firms in the world today got their start through outsourcing and continue to rely on it today. And companies from all industries use outsourcing for everything from fintech to healthcare.
Yes, that Google. If you need proof that companies of any size and stature can benefit from outsourcing, look no further.
Google started outsourcing work in 2011 by sending AdWords support to call centers worldwide. They’ve been outsourcing some of their software development since at least 2014. And today, most of Google’s workforce is actually third-party contractors.
This might sound odd, given Google’s reputation for providing endless perks and benefits to employees loyal to the company. But if anything, outsourcing lets them make good on their commitment to their full-time employees. When they need to take a vacation, have a child, or go on medical leave, there is a deep third-party labor pool to draw on to temporarily fill the gap. Google takes advantage of the flexibility offered by outsourcing.
Another huge company. Although not a big name in the United States, Alibaba is the largest online retailer in China, and by some measures the entire world.
Alibaba was founded by Jack Ma in the 1990’s. At the time, China had very few internet connections. There was very little programming talent in his hometown of Hangzhou.
To build Alibaba, Ma actually outsourced the development of the website and its software to developers in the United States. This is a classic case of how outsourcing development can help by providing needed expertise.
Slack is the most important communication channel for businesses worldwide, except for maybe email. And it wouldn’t have gotten off the ground if not for outsourcing.
Initially, Slack was something of an accident. The developers who created it were a video game studio called Tiny Speck. Slack was simply an in-house communication tool they developed to make their job easier.
But seeing its potential, the Slack team brought their early prototype to MetaLab, a user interface design company. They helped turn Slack into what it is today. They gave the Slack prototype a cute, fun interface that helped it stand out from its peers.
In this case, Slack’s outsourcing gave them expertise as well as a fresh perspective on their existing application.
A freelance developer originally built GitHub’s backend. The startup initially didn’t have enough money to hire an in-house team, so they simply hired someone else to work on the most complex and important part.
This is a great example of how outsourcing can save costs. Hiring an in-house team will almost always be cheaper than hiring a third-party individual or development team.
And the relationship you build with your developer can grow over time. Scott Chacon, the freelance who first built GitHub’s backend, went on to become GitHub’s CIO.
AppSumo is probably the greatest example of using outsourcing for saving costs. AppSumo famously started out on a shoestring budget of exactly $50.
Noah Kagan, AppSumo’s founder, knew that he wanted to validate his business idea as quickly as possible. Much of the value he created simply by emailing a couple people and getting them to sign off on promos with him. The $50 went to paying a single developer to write some code to connect PayPal to the AppSumo website.
Ultimately, that $50 was spent to create a very basic MVP just to test out a simple business idea. Sometimes that’s all you need!
Outsourcing Development with JetRockets
JetRockets designs award-winning web and mobile apps for clients of all shapes, sizes, and industries. We help bring your ideas into reality.
Many of our clients are startups that need a prototype or an MVP fast. We deliver responsive, high-quality solutions that allow clients to test ideas, impress investors, and attract customers.
Other clients have established brands that need to solve a particular problem. In many cases, they don’t have the requisite talent in-house to satisfy their exact need. We take a look at their operations and come up with a custom-made solution for them.
Do you have an idea for your business? We’d love to chat!