How to hire offshore software developers: The comprehensive guide for Startup founders

Nowadays software development is a large industry in the world. The enterprise market is approximately $450 billion and plans to grow continuously. However, the developers that a software company hires are one of the most important aspects of their business.  Many software companies seek developers in their local area. However, this is no longer the only way of building a good development team. Outsourcing and hiring offshore are more popular than ever. It allows you to hire people from all over the world and even have them collaborate. There are numerous advantages to outsourcing. But you must consider because it is possible to go wrong. This blog post will look at a few tips to hire offshore developers for Startup founders.


The IT outsourcing market is expected to reach $413.7 billion by 2021, a significant increase from the $66.52 in 2019. Globally, the use of outsourcing for IT projects, including software development, is at an all-time high. Many businesses, particularly small and medium-sized enterprises (SMEs), are pushing this. Therefore, many business leaders are already developing their knowledge of how to hire offshore developers.

Given the numerous benefits that outsourcing provides, it is easy to see why. To begin, outsourcing is typically classified into three categories based on distance. Onshoring, Nearshoring, and Offshoring are the three options.

  • Onshoring: This is an outsourcing to a city within the same country. For example, a Seattle-based company might collaborate with freelance developers or a New York-based software agency.
  • Nearshoring: Outsourcing to a different but neighboring country. Assume an Israeli company outsources to Ukraine.
  • Offshoring: Outsourcing to a faraway country, such as when a US company outsources to Vietnam.

Why should hire offshore developers for Your Startup?

According to the Deloitte Global Outsourcing Survey, 72% of businesses prefer software development outsourcing to in-house development. The following are the reasons for this:

It is a low-cost product development strategy. 

According to Quartz, 46% of startups fail due to a lack of money. However, if you hire offshore developers, this problem is unlikely to occur. Because you will not be spending your money on things like office rent, payroll, insurance benefits, vacations, recruitment fees, and so on. Therefore, you can spend the funds on the most important domain – developing an MVP. Furthermore, because of the lower cost of living, the rates of developers in offshore countries are lower than their counterparts in the United States and Western Europe.

Productivity has increased and saves time. 

A team of offshore developers can cut costs. Moreover, it also speeds up the development process. Therefore, you can save your valuable time. ime is critical for any startup because each one is born in a competitive environment. Furthermore, with a dedicated development team, you will not have to spend time training new employees. Because each outsourced developer already has their skills. Finally, you will not have to spend time on project management routines or HR activities like employee retention. Because a vendor development company can handle all of those tasks for you. As a result, you will be completely focused on your work.

More talent than could be found on-site. 

IT outsourcing allows you to tap into a greater talent pool than you could find on-site. For example, the majority of developers in Vietnam are already employed by tech giants. They are paid well, receive attractive benefits, and feel safe and comfortable with their current employers. Whereas startups imply risks, making it much more difficult to hire developers for the startup businesses in the United States. Moreover, offshore countries in Asia and Eastern Europe are brimming with skilled developers eager to join your startup.


It is difficult to scale your in-house team or change the technology stack in accordance with the project’s stage and scope. However, these changes are common in startup environments. So adaptability is essential. The good news is that outsourcing developers are adaptable. Moreover, it can move between projects with ease, especially in case you work with them through a dev shop.

There are fewer conflicts. 

Startups are usually the result of personal relationships between co-founders. However, business interactions differ from personal interactions. Therefore, it can lead to disagreements and misunderstandings. However, an offshore development team can assist you in avoiding such conflicts during the MVP development stage.

As you can see, hire offshore developers can help your startup run more smoothly. After all, products like Skype, Slack, Github, and many others were created by remote teams.

Models of Offshore Development

There are two main models for offshore software development. Therefore, you should understand how to outsource software development successfully begins with determining which model is best for your project:

  • Project-based outsourcing: Client hires a team of developers for a short-term, one-time project. The goal is usually to deliver quickly, and the payment rate is often fixed.
  • The specialist model: When a company lacks in-house software developers, it often hires a remote programmer to fill the skills gap. This is known as staff augmentation. The time is short or long. Besides that, the client can hire a project manager or lead developer to supervise the process while the dev shop provides the developers.

So let us now look at the specific steps you must take to hire offshore developers.

Where to hire offshore developers?

The next step is to identify qualified software professionals. You have the option of hiring an agency or hiring individual developers before creating a team. One critical factor is where to outsource software development. Offshore software development is most popular in Asia and certain European countries. More importantly, Asia is more popular. Besides that, their developers are less expensive. You can consider Ukraine, India, China, the Philippines, Vietnam, Mexico, and other countries for outsourcing or outstaffing. 

The importance of location is due to cultural compatibility. Therefore,it can affect communication. Many developers in popular outsourcing locations do not or speak English very well. However, this does not imply that they are less qualified. But, you should consider how the communication gap may affect the project.

How to hire offshore software developers?

Define your requirements and objectives.

To determine how to outsource your project, you must know what you want. What type of application do you want to create? What kind of developers are you looking for? Infrastructure is required for the project? What is the anticipated time to market? What are the quality standards? Your budget proposal? What contingency plans do you have in place?

If you want to successfully hire offshore developers, these and many other questions must be answered before you start looking for developers. Your list of needs and goals should be as comprehensive as possible, covering every aspect of the project. You must also distinguish between what is necessary and what is nice to have. Every decision can help you visualize how you want the project/product to turn out. Therefore, this helps to explain how to hire offshore software developers.

Define your budget

You can’t hire offshore developers if their payment rates are out of your price range. Therefore, when negotiating the project’s cost, you should make sure which services and infrastructure are included in the total cost and which are not. 

Contact preferred developers

After you’ve decided what your project will be like, how you’ll outsource it, and where you’ll outsource it, so it’s time to identify the remote vendors who you believe can be a good fit for your project. In case it is an agency, you should go to their website to see a portfolio of previous projects they have worked on. Thus, you also should request resumes and personal portfolios from individual freelancers. You should think about the following factors:

  • Skills: What abilities do the developers have? And how knowledgeable are they? There are many different types of developers such as web developers, mobile app developers, frontend or backend developers, Full Stack developers, DevOps developers, and so on. So check that your vendor’s skills match the needs of your project.
  • Experience: Experience tells a lot about a person’s problem-solving abilities. The more experienced a developer is, the more diverse the software problems they have faced. Therefore, it gives them an advantage over someone who is skilled but inexperienced. That is why senior developers are preferred. When hiring an agency, you should not base your decision only on the agency’s age. Perform due diligence to determine whether the members of their team are skilled and experienced.
  • Past clients: Each developer has a portfolio or resume which includes information about their previous clients. So you can contact them to confirm that they are who they claim to be. You won’t get accurate information about this unless you speak with previous clients.

After you have these details and have decided on your preferred agency, you should contact them to schedule an interview.

Evaluate the skillset

You can evaluate candidate based on the following:

  • Questionnaires:  One significant advantage of questionnaires is that they test a developer’s approach to problem-solving rather than their coding skills. Each software is designed to solve a specific problem or meet a specific need. So a developer must be innovative and adaptable when faced with challenges in addition to coding.
  • Coding tests: It allows you to check the candidates’ actual coding ability. To conduct coding tests, you can use a variety of tools. When the candidate is finished, the code is analyzed, graded, and taken into account in the final decision. However, coding tests are often used when hiring in-house rather than offshore developers for a startup.
  • Work Review: Developers may be hesitant to allow you to examine the source code of their actual works (not samples). Because some of these source codes are bound by legal contracts. So they may be prohibited from sharing them. However, you can review the apps that they have created. This has nothing to do with coding. You only examine the application to see if all of its UI components are operational.

This is the final step in the hiring process. You must have already chosen a developer/agency at this stage. So it is very important to establish working conditions while keeping the legal aspects. By hiring an offshore development team, you are providing access to and knowledge of your company’s operations, some of which may be sensitive.

The source code of the software and other important data and resources, will be available to the developer as he or she builds the application. It can  be regrets if there is no proper legal framework to govern data ownership, access, use, and sharing. As a result, consider including the following types of legal documents in your agreement.

  • Non-Disclosure Agreement (NDA): An NDA specifies the terms under which sensitive and confidential information may be used and shared. For a set period of time, it prohibits the vendor from sharing such data (such as the source code) with any unauthorized party.
  • Service Level Agreement (SLA): the SLA covers the project’s entire scope, the vendor’s duties, and the client’s expectations from the vendor. It has information like the service to be provided, assessment metrics,…
  • Statement of Work (SOW): An SOW is similar to a SLA. But it focuses on the client’s obligations like payments, testing, standards,… Of course, these obligations are contingent on the vendor meeting deliverables, milestones, and schedules.
  • Software Requirements Specification: It contains the project’s technical details. It imagines how the software will run and function once fully developed. When the software is built, these specifications serve as the foundation for its evaluation and testing.

Offshore software development challenges

Differences in Time Zones

Latin America (Argentina, Chile, Brazil, Colombia,…), Eastern Europe (Ukraine, Belarus, Poland,…), and South-East Asia (especially Vietnam) are the most popular IT outsourcing destinations. In case your offshore development team is in a different time zone. So it may be difficult to synchronize the time when both the in-house and offshore teams are online. However, by selecting the correct time zone, you can turn it into an advantage. Moreover, modern timezone management tools can assist you in overcoming this challenge.

Inadequate face-to-face communication

“Offshore” means “located in another country”. Soo there will be a distinct barrier between in-house startup founders and remote developers. Nevertheless, there is a solution. You can visit the offshore team location regularly to spend some time together. But these trips would cost less than a startup that failed due to hiring errors. Another option is the regular video conferences.

So many vendors for selecting

The abundance of software development vendors on the offshore market can provide you with both advantages and disadvantages. It’s difficult to choose from thousands of agencies that provide hire offshore developers. You could spend a lot of time evaluating outsourcing agencies through platforms and still make the wrong choice.

Cultural distinctions

When working with offshore development teams, you must know the distinction between low and high context cultures.

hire offshore developers 

The low context culture is: 

  • Specific to the United States and Europe, including Eastern Europe
  • Relies on words and facts; task-oriented
  • Deadline-oriented
  • Logical
  • Adaptable
  • Based on the agile methodology.

The high context culture is:

  • Specific for China, India, Philippines, Vietnam and other Asian countries;
  • Relies on trust and emotion;
  • Team-oriented;
  • Not deadline oriented;
  • Intuitive;
  • Reluctant to changes;
  • Based on the waterfall methodology.

Hire offshore developers with ArrowHiTech

Hiring an offshore development team is the best choice for a tech startup. Because startup founders will save money and time while getting a high-quality MVP. However, before hiring developers for a startup, you must clearly define your requirements, determine the necessary skill set, plan your budget, and seek offshore locations. Furthermore, be aware of the difficulties that may occur when hiring offshore developers, such as time zone differences, a lack of personal interaction, and different cultures. However, when you hire offshore developers from ArrowHiTech, you don’t have to hire the entire team, including project managers, designers, and so on. Instead, you can assign engineers to various roles based on the technologies and seniority levels required for your project. We will provide you offshore developers with specific features as below:

  • A wide range of software developers are available. ArrowHiTech  provides you a much larger pool of high-quality offshore developers than working with a traditional offshore development agency.
  • There are no hidden fees: When a client chooses to hire a developer, the sourcing and interviewing process is completely risk-free for the client. The hourly rate for each developer is stated in their profile.
  • Positive feedback from previous customers: ArrowHiTech clients have complete faith in our offshore developers

So now what are you waiting for? Let’s leave your contact at CONTACT FORM, and our support team will contact you to give you more information at our Offshore development center.