Why Outsourcing Your MVP is a Smart Move

You have an idea for a digital product but don’t have the skills or time to dig in and build it. This is a common scenario for a lot of innovative people. You are thinking about outsourcing the development but you worry about how will it go, about avoiding bit pitfalls…

We're a tech company and we get a lot of people in your situation. There is nothing wrong with outsourcing your product development and most of the successful people you read about do it all the time. Usually whether or not you outsource your MVP has very little to do with the success of your product.

The companies we’ve seen fail have failed to reasons mostly unrelated to who and where their MVP was built. Usually, the problem is the founder who is not giving too much effort into market research and sales. Again, this is something you can outsource but if you are just starting out the first steps are very important for you and for your product.

There can be a few problems with outsourcing MVP or entire product development but most of the times the outcome is far better then if you go and build it yourself. The most important thing is to treat the outsourced company as a partner and build a strong relationship with them based on trust.

Outsourcing companies have the manpower and experience to quickly and efficiently deliver your product to the market. Try software houses that have multiple successful MVP projects behind their belt. Once you validate your idea you can start building a team on site while still outsourcing some work.

In Kalmia, we specialize in helping startups and founders around the globe and we’ve put together a few key points that you must be prepared for in order to master the outsourcing process.

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Unclear requirements are a threat to your product

Unclear requirements are the biggest problem with outsourcing or even with in-house development. The fact is that the people that are developing your product don’t understand your business needs, your market research, your vision. On the other hand you probably don't understand the technical needs for your product.

This means they'll try to develop things in the way that is best for them, not what's best for your company or your long-term vision. This is surely not meant in terms of taking huge shortcuts or missing pieces of functionality, but smaller things like specifically designing around their software environment (email servers, hosting, languages, etc). This can cause issues when you get into your funding rounds and can actually afford to continue in-house.

So be sure to communicate your long-term vision of your product to your outsourcing partner in order to avoid as many pitfalls as possible in the future. This will help estimate the system needs and design the system architecture accordingly.

Good companies will provide you with a product manager that will try to live your vision and thus take of communicating the requirements with the team for you. This will greatly increase your chances of having a great product built.

Here the best question to ask your self is: What, specifically, do I want to build? If it’s a website, find similar ones and draw up the main pages with your desired logo. After a few iterations on paper, you should have a general outline. Now use some mockup tool to do a more formal mock-up.

If you need consulting on how to start planning the requirements we offer free free Skype consulting for all that are interested or in need.

Funding the MVP development

Money is hard to get. That’s a fact! Specially in the early stages of a startup company. So usually people turn to outsourcing to try to save money and deliver something to the market fast. Founders are usually generous with equity when it comes to covering development costs and many developers and development shops are wary of working for equity.

Funding Outsourcing MVP Development

Realistically, very few equity projects will ever turn into something special. You'll most likely need to be prepared to spend $10k-$100k to get a good MVP up. Here at Kalmia we specialize in helping startups succeed so if your project is special to us we will also consider equity. This also adds a certain level of trust to our partnership as it lowers your risk and increases ours. This will also reduce your upfront cost and encourage us to have a part in your product.

Companies in the early stage change their vision, mission statement, and product requirements a lot as they pivot. This changes may be very costly so be sure to also cover that in your agreement with the outsourcing partner. In order to succeed you need to find a development partner that will not charge a lot of money if you need to pivot your product to reach another market.

Most of the founders have a wrong perspective on money as they seem to think that they are losing money if they outsource development. Actually, they invest the money to get something done faster by someone who has experience and has done it several times before which at the end will make it cheaper and better.

Always make sure you're clear on exactly who owns the rights to the code and concepts behind the product you are building. You'll want to get a lawyer involved in this.

Most of US companies turn to development companies overseas as their price is significantly lower than hiring local developers with the same skills in the US. One of the biggest benefits of outsourcing your MVP is that you can use all those savings to build a more feature-rich MVP. Outsourcing allows your startup to reduce costs without sacrificing quality - especially if you take the time to find the right company for your project - like us :D

Managing the developers

Usually, the outsourced company will provide you with a product manager that will manage developers and communicate the results and problems with you but if you have experience with managing people then you can do that your self.

Manage Outsourcing Development Team Building Your MVP

Most good development companies use agile methods for managing development projects so you can expect to receive results regularly - every week or two weeks. Be sure to test the deliverables all the time and provide feedback with clear instructions on what needs to be done next. Make sure you have ownership of the code, hosting service and domain and set up bonus payments that line up with quality targets and deadlines.

Perhaps the most overlooked benefit of outsourcing your MVP’s development is the ability to bring an experienced expert to your team on a short-term basis without a long-term commitment. Think how much you would have to spend to have a full-time expert on your team.

You also won’t have to worry about letting go of a team member should you need to scale down in the future, or stress that you might lose your team member should your project move in a different direction. By outsourcing your development work, you can hire expert programmers only when you need them, or lower their workload should you need to cut costs.

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Starting a software project?

Get Our Free Software Project Checklist That Will Help You Build Your Project in 60 Days or Less.

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Launch and scale

If you’ve done the entire process right you should have a functional web site or application. Now you can test the product with customers and, if successful, start approaching technical co-founders and angel investors. Expect the entire outsourced MVP process for basic websites to take 1-3 months and more complex apps to take 3-6 months.

Tell the world that you have built an MVP

If you want to learn how to build and launch an MVP as a non-tech funder read our MVP Guide for Non-Tech Founders.

Outsourcing your MVP development work is one of the smartest options for cash-strapped startups that want to get their product to market as cheaply and efficiently as possible.

Kalmia offers a guaranteed quote for your MVP, passionate product developers and management and a team of experienced developers that work on small and large projects all the time.