Nowadays, when a good Internet connection plays a much more important role than a physical distance between team members, software development outsource became a common practice. Yet, while it’s not a problem to reach out to any person who is a thousand miles away from you in just a few seconds, many startuppers and business owners are still full of doubts.
It’s relatively easy to trust one development project to the outsourcing company, since the benefits are quite obvious. But when it comes to building a really large and thriving business, is offshore development the right option? Definitely not if you trust your project to outsource developers in India. There’s no such things as cheap software because you either do it right once, or do it time after time because you want to save money. Bad code costs more than good code and time will prove it to you. Therefore, you should definitely hire a development team from European country like Poland or Ukraine.
In this article, we collected the most interesting stories of successful companies that outsource software development. So let’s dive right into them.
Which is the best example of outsourcing software development? I would say it’s WhatsApp. The app was launched in 2009 and, in 2017, it already had 1.5 billion monthly users sending 60 billion messages per day. Looking at this numbers, it’s no wonder that WhatsApp ranked No. 1 app by downloads in both — App Store and Google Play Store.
What’s so special about this application? WhatsApp is a messenger that allows people to stay in touch by sending text messages (including group messages), files, photos and videos. It’s available for Android, iOS, BlackBerry, Windows Phone and Symbian that makes global communication much easier. Either it has no ads that is a great advantage for any user. And let’s face the truth: people just love messaging — sometimes even more than live communication and definitely much more than phone calls.
But how did everything begin? From the outsource, of course! WhatsApp founders needed to keep development costs low so they found Igor Solomennikov, an iOS developer from Eastern Europe, on RentACoder.com (a platform for hiring freelancers). Igor developed the early version of WhatsApp as an offshore contractor and only later became a full-time member of a team. This inspiring story, which is also a great example of outsourcing success, shows that even a really long journey can begin from development handled offshore.
It’s hard to imagine a development project without GitHub and everyone in the tech world knows what it is. GitHub is a web hosting service that is used for version control of a computer code. Developers usually create numerous versions of the code making lots of changes and revisions. GitHub stores these modifications in a central repository that allows for the collaboration among all members of a development team.
Why is GitHub one of the best examples of companies that use outsourcing services? Well, the story is quite trivial. GitHub founders had a brilliant idea but its implementation required hiring top-level experts in Git, an open-source language GitHub is based on. Fortunately, they met Scott Chacon, who was a perfect fit for this position. Yet, Scott (as any skilled professional) was too expensive for them to hire him full-time, so they decided to apply the outsourcing strategy.
The results? As of June 2018, this service had 27 million active users that is quite a lot as for the tool used by one specific industry. On October 26, 2018, GitHub was purchased by Microsoft for $7.5 billion. So are you still wondering what to do if your company lacks professionals or funds to maintain an in-house development team?
I bet everyone knows what’s Slack since it’s one of the most widely-used cloud-based service for team communication and collaboration. Slack app was launched in 2013 by the company called Tiny Speck (now Slack Technologies, Inc. with headquarters in San Francisco, California) as an internal tool. As of May 2018, it had over 8 million daily active users, including 3 million paid users. Even such large companies as IBM, BBC and Oracle use Slack in their day-to-day activity.
Speaking about money, the numbers are even more impressive. The company is privately held, so there is no publicly available information about its finances. However, it was estimated that Slack hit the threshold of $100 million annual revenue in 2016 and had $200 million in annual recurring revenue in 2017.
Whom do they owe their success to? If your answer is ‘outsource developers’, you’re totally right. Slack is one of the best examples of companies that outsource. Its logo, app and web design – the things that make Slack look and feel different – were developed Canadian agency. What conclusions can we make out of this story? Well, even the most crucial parts of a development project can be outsourced and such strategy can lead to great results.
AppSumo is a website that is well-known among startuppers, entrepreneurs and just people who are interested in marketing, business and technologies. As of today, it has 730k subscribers and extremely active community on social media. And it’s no wonder — AppSumo distributes daily deals on digital goods such as apps, courses and e-books on favorable terms, for example, discounted price or a lifetime access to a service.
The website was launched in 2010 by Noah Kagan, an entrepreneur who worked for Facebook before that. Initially, it was planned only as a side project and no one expected it to grow to the 8-figure business. And, thus, it made no sense for Kagan to hire a full-time in-house team to develop or do some tweaks to the product, while engagement of external resources seemed more logical option at that time. This is, actually, the reason why we see AppSumo among other examples of companies using outsourcing. The story how Kagan found a developer to make a PayPal button and credit card form for as much as $50, has already become a legend.
Alibaba is one of the world biggest marketplaces where, among other things, outsourcing companies can sell their development services. But few know that Alibaba is also in the list of successful outsourcing examples.
The company was founded in 1999 by Jack Ma Yun, now a successful business magnate. At that time, it was called China Yellow Pages and one of the problems that it faced was the lack of professional software engineers who could take over website development. What was the solution? Alibaba decided to outsource software development to a company from the U.S.
I believe all of us know the ‘happy end’ of this one of the least known outsourcing success stories. In March 2018, Alibaba group reported consolidated revenues of $39.9 billion. Also, as of the second quarter of 2018, the platform was accessed by 576 million active buyers (within the preceding twelve months). Even I’ve ordered some products there, but who hasn’t?
Infor is one of the leading agencies that provides cloud solution and cloud-related software services. It has more than 2000 reviews on glassdoor.com. With 10 000+ employees and around 2 billion USD in revenue Infor is definitely a major player in the area of cloud computing. Its direct competitors are SAP, Microsoft and Oracle.
Though much younger than Microsoft or Oracle, in fact, younger than 20 years (started 2003) the company is now considered a respected provider of software enterprise, providing products and service for the astonishing 68 000 companies around the world.
Infor has offices all around the world in Phillipines, US and Europe. It successfuly outsource developers to make allow workforce diversity, looking for talent wherever possible.
In this article, we featured only the most successful outsourcing stories, but, of course, there are much more of them. So if you still doubt whether hiring offshore developers is a wise decision for your big development project, we recommend you to pick your favorite application and do a little research. Because let’s be honest: few have enough money to gather a large in-house team at the early stage and often even the most successful products were created by outsourced developers.
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