Build and validate your product first, hire later

TLDR — Building a technology team for a startup is hard. When you’re just starting up, it still makes a lot of sense to build the product remotely. Once your product is proven, well accepted or even profitable, subsequent versions may be done in-house. This blog post explains the reasoning behind this.

When we quote our clients for software products, one of the most common response we get from them is — “Why do you quote so high? We could possibly hire a few people and get this done in house for much cheaper!”

Here’s what we tell them — Hiring and building a technology team is hard. And that’s not something you should be focussing on *at this time*

When you startup, your time is your most valuable asset. Every second spent doing something that is not adding value to your business in some form or the other is wasted money. We believe that as founders, your every thought and your every breath should be focussed on just two things — Product and Marketing.

So building a product means building a team of developers. Right? That’s what one is likely to think. It’s easy to fall into the trap. Here are the pitfalls:

Case #1: Hiring junior developers

These are the only people whom you can possibly afford right now, but they come with their own set of problems.

1. They know they’re being underpaid and are probably over-worked. They’re constantly on the hunt for newer, better, higher paying opportunities and are just probably using your company to gain some skills, experience (and cash). Employee retention and churn is a big challenge.

2. They will need a technology and code savvy mentor — In an ideal world, junior developers will understand your product and your vision and build a finished, working, smooth and bug free product which you can sell. In the real world, they’ll probably not understand a word but try and build “something” anyway, get stuck with coding issues and stay stuck for hours or days, they will lack means to estimate when your product will be ready, if at all they realize whether they can even build your product or not.

3. Identifying skills is easy. Identifying an “ability to learn” is hard. And even if you have cracked that problem, the supply of such folks is so minimalistic that it could take weeks, if not months to identify and hire the right guy. And that too, may not turn out to be the right decision.

It’s common knowledge that one senior developer could possibly do the work of five junior developers and may even outperform them. So is hiring senior developers the answer?

Case #2: Hiring senior developers

If you have the pockets to attract senior developers, you’re likely to face another, unique set of problems.

1. You need to pay them well — You’re a startup and one thing you don’t have enough of is money. Senior developers need serious cash. Since they’re already drawing market-level salaries, you’ll need to pitch them with something even higher to be able to even have a shot at an interview.

2. They are looking for stability — Some people are really good on the job but they may not be in the startup frame of mind at this age. They’re probably married, or on the verge of getting married. Working with an unknown startup is risky to stay the least. Unless you’re able to show them enough funds to run the business for a couple of years, it will be hard to convince these people to join you. Most people of this age are looking to “settle down” in terms of place, family etc. Hopping from one startup to the other every year is not something they’ll enjoy doing.

3. Retaining them could be risky — What if your startup fails to lift off in the first place? Senior developers demand serious money. For how long are you willing to play the waiting game? Are you comfortable firing people as soon as you realize your startup didn’t really work out the way you thought?

In summary, once your startup tastes some success, it will have more visibility, the brand name will be more recognizable and you’ll probably have deeper pockets too. Building and retaining a team at that stage will be far more easier.