Is Anyone Having Success with Services That Farm out Development, Such as Topcoder?

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Dave’s answer to this Quora.com question:

Being a software company yourself, you have some additional challenges in making a solution like topcoder, elance, etc. work well.

Outsourcing Tough For A Software Company

It’s counterintuitive, but many software companies have a harder time finding great vendors as compared to ordinary clients.

If you’re supporting a product/service of your own, you most likely have an existing internal process and workflow and you need to find developers that can really fit in well. That’s not always easy to find.

Also, as a software company yourself you’ll most likely be a bit pickier and specific about how you want things done as compared to a typical end-client.

If you’re a software company that does projects for your own clients, it’s even tougher because you’ve got to deal with things like estimations, migration, etc. and each project will be a bit different. At SourceSeek we refer to clients like that as ‘resellers’ because rather than just doing a single project or product, you are most likely going to send a variety of projects, etc.

Elance and similar services are most effective for ‘end-clients’, who aren’t in the software world themselves, so it’s not a great choice for software company clients.

Making a Match

The approach we take with software/reseller clients is simple: we look for companies that have experience working as a ‘white label’, back-end provider for such clients in the US, and are used to working that way.

The trick is to look for companies that have the requisite skills and experience, but are also able to be profitable and satisfied with clients that bring the challenges of software companies and resellers. They are out there, but they aren’t easy to find on Elance because solid companies with those skills will typically ‘graduate’ off of Elance.

About 30% of our clients are in the reseller category, so we see this a lot. What we’ve noticed over the years is when an offshore company is willing to accept a software/reseller client, but the aren’t really excited about the prospect of dealing with other people’s process, estimations, clients, etc.  – the engagement will typically fail. A company has to be game to take on the overhead of this type of work.

Once you find a company like that, it can be incredibly successful.  Good luck!

Originally published as SourceSeek’s answer to the Quora question: Is anyone having success with services that farm out development, such as Topcoder?
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Dave Hecker

Co-Founder at SourceSeek at SourceSeek
Dave is a seasoned technology executive focused software delivery, quality, process, and helping clients succeed at international software outsourcing.