#307 Outsourcing Tips for Startups: An Inside Look With Sean Languedoc

Mehmet: Hello and welcome back to a new episode of the CTO show with Mehmet. Today I'm very pleased welcoming Sean, joining me from Canada. Sean is the CEO of outforce. ai. Sean, the way I love to do it, as I was explaining to you [00:01:00] previously, I keep it to my guests to introduce themselves because of a theory I have.

The best one who can introduce himself or herself is the person himself or herself. So the floor is yours. 

Sean: All right. Well, thank you very much, Mehmet. Yeah, I'm just a guy who likes to solve business problems and enable those solutions with technology. And I've done it four times with tech companies. Uh, now I've, I've, in every time I've built a tech company, I've hit an inflection point where I've had to outsource something.

And as a result, I've had to. Uh, have the opposite problem of outsourcing of, of hiring engineers, which is outsourcing has too many options. So this time I decided to build a solution to that and build a filter to help companies get better matched with outsourcing agencies. And that's what edforce is that's 

great sean and of course, 

Mehmet: we're going to discuss a lot about this topic today But of course like anything You know when when [00:02:00] you start a business when when you decide to solve a business problem as you see you said 

Sean: Yeah, 

Mehmet: you must have spot some patterns some challenges Uh, some, some common problems when it comes to this, but what was the moment that triggered you, Sean, and you, you've been a tech entrepreneur for, for a long time, you said, okay, you know what?

I think I can solve this problem. Let's discuss first how you came up with the idea that, okay, now is the right moment because I got to solve these 

challenges. 

Sean: It depends. And there've been very different businesses that I've been in, and I have no expertise in the business, which is probably part of the problem that I have is I just, I see where the holes are based on my own experience and try and fill it.

And, uh, either with a service or a technology and, uh, and that has been successful a couple of times and unsuccessful a couple [00:03:00] of times, like I say, being from Canada, uh, I can say this, that all of my businesses have gone south. Some of them have gone to the United States, which means they've been successful.

But, um, yeah, I really, I think it's first you have an idea, then you have to figure out whether you've got a product market fit. Because your idea as it, as it initiates will never be the same as what is actually what the market wants. So you look at anything like Y Combinator or any of the startup accelerators, they tell you go talk to customers, figure out what they want.

And, and one of my first businesses is funny enough, everybody told me it was what they wanted. Until somebody told me it was the stupidest idea that he's ever heard. And he was one of those people that were the right customer profile. And, uh, I said, well, what, why are you saying that? Cause everyone else is saying it's a great idea.

And he told me the real reason, the things that people weren't saying and. Sometimes you need to listen to that off one instead of [00:04:00] say, Oh, this guy doesn't know what he's talking about. Um, and that really helped because I ended up landing the perfect business in that case. 

Mehmet: That's great story actually, Sean.

Now, you know, let's discuss, you know, a little bit, um, you know, the background of, of the problem, uh, you're trying to solve today. So yeah, you must, you must have seen, you know, some common, as I said, mistakes that usually, Founders, especially maybe first time founders, um, they fall in when they are trying to, to get something to an outsource agency.

So like, what are these common mistakes you've seen? And, you know, From your experience, how they can avoid falling in that trap? 

Sean: Well, I mean, people outsource for a whole bunch of different reasons. Um, some of which I might have mentioned where you're growing fast and you need more engineers than you can [00:05:00] hire at a certain pace, or you've got a trade show, you need something ready for the show.

We've got a big account and they need a front end that matches theirs and APIs into their systems. So those, uh, you know, those are not really core engineering functionalities. Um, and, and so those are generally the ones that are outsourced. In the case of a startup, you know, when I did my first startup, uh, you wouldn't even think of outsourcing because it was in the nineties and you would have enough engineers around.

Now, good engineers are all distributed and not, and they're hard, they're pretty hard to find, even harder to bring them into a new company. And, and so that's why you would outsource something at the beginning. Another reason to outsource something at the very beginning, and you mentioned startups specifically.

So I'll answer to that question is, you know, you, like I said, you don't have product market fit until you've had it tested with maybe a hundred customers. Right. And so the person that [00:06:00] you may be a friend with who could, you could bootstrap and build some product, um, might be good for that start to get to where you're going to figure out that what you're building is actually, you know, if it had this, we would do it kind of thing.

And you have to rebuild something that's adjacent to what you're building, but often you'll get to a certain point where the engineer you started with. Is not the one that's going to take you to the accelerated growth or the scalability that you need just because it's your friend. It's not a good reason to be your lead engineer, or just because that person is good and available is not the reason to be the lead engineer.

Because what you end up doing, because you're kind of low on cash. Is you'll give that person a big chunk of the company and then you have that really tough conversation later in the business cycle Where it's not working out and uh, you know the it's spaghetti code or you know It was really good for a while But it's not going to be good enough to go in the future or you get [00:07:00] investors Who are starting to tell you how to do your business which often happens with venture capital Um, and they want somebody else to come in and do things so you have these really difficult conversations so if you could prepare for that in advance and And just find friends and family to get the money to get some third party firm that has no vested interest in your company, but is good to build your proof of concept product, which today is not a very expensive venture, you know, with copilot and everything else going on in the development world, you can quickly wrap up a prototype of what you're trying to access.

Even just with Figma showing clickable screens to validate whether it's something that people would actually use and want before you actually start really investing in product engineering teams. So it saves you a lot of trouble downstream if you can avoid giving up equity. And major commitments to your co founding engineer [00:08:00] and that's a terrible thing to say to a lot of your audience who are engineers But a lot of engineers are starting their own company as well.

So who you bring on your own team makes a big difference as well That's that's where i'd say i'd go 

Mehmet: now sean. I get I get your point But do you think that this applies to certain type of founders or even you know, even if you're talking about normal company um Because if if the founders are technical, right?

You Yeah, if the founders are technical, so maybe they can do some of the tasks themselves. 

Sean: Exactly. 

Mehmet: Because, because, you know, like one of the things I've, I've been lucky enough, especially in the last year to, to also sit on calls with investors, right? And these guys, usually they look on to the founding team.

And you know, they, they look to these, to these people who are coming to them, pitch their ideas. Now, does it matter? For example, if we have, let's say a non technical founder, plus a [00:09:00] technical founder versus maybe two non technical founders who are trying to get, they have brilliant idea, but they need someone to build it from the ground.

And maybe it's a loaded question. I know. And does this apply only for engineering or also applies for other things also as well? Like, I don't know, maybe a lot of things go to office, office, marketing, sales, whatever. Yeah. So what's, what's your take on this? 

Sean: Yeah. So traditionally you, you know, engineering, traditionally engineering is the moat that you have as a defense for your company.

I guess that's the point I'm trying to say is that, yeah, for what I just described for a technical founder, no, if you're the, if you're an engineer and you're the founder of a company, great, go for it, build what you want. And you probably are the best to assess what kind of a team you want to have around you.

You know, engineer, good engineers are very flexible in terms of what they can build if there's, if they have a good engineering mindset, the, but a non technical [00:10:00] founder should be very wary about giving a big chunk of the company to a technical found co founder without. Having done a previous company with that technical co founder and knowing how far that person can go.

Um, to your point for the technical founder, I would say today and anyone, any founder for that matter, your technical moat has disappeared. There's just so much speed in the ability to deliver engineered product now with AI that, um, if you get funding, Anyone who is adjacent to you in that market, but was not hitting the sweet spot that you think needed to be filled, can easily move into your market and rebuild or reverse engineer what you're building and take away your market with more money and more horsepower.

So speed and go to market is today probably the more important co founder. Or equally important co founder to the engineering. [00:11:00] 

Mehmet: Great. I get, I get the point shown now, of course, here, I'm not trying to challenge as I'm trying to, I 

Sean: love it. I love it. I love 

Mehmet: it. No. So, because what I try to do is I want to convey.

A message, but I prefer that this message comes out from the expert which is you in this case now 

Sean: Yeah Go ahead. I love what you said was absolutely true Yeah, so welcome 

Mehmet: Yeah, so the other thing that usually happens sean now Actually, it happened With someone close to me. So Okay, they were discussing some ideas Okay.

They have some technology background, but they cannot write code themselves. Right. And they don't understand anything about coding, but they have the technical knowledge. They know, like, of course, what is back end, what's front end and so on. Now, one of the guys, you know, the question that came to his mind is, Hey, okay, fine.

Now we can bring [00:12:00] someone outsourced to do this, but what if this guy take our idea. Because he's not our employee And you know, he gave it to someone else or he go and build it himself. And the other thing, okay. Of course there was discussion. We can sign NDAs and we can do this. We can do that. And he said, okay, if you outsource to a place and the guy is living in, you 

know, 

Mehmet: And somewhere in the world, maybe in Southeast Asia, maybe in South America, maybe even in the U.

S. I don't know. Right. So, so how was this, you know, very open world, I would say, but yet still you have the distances, how you can control this show? Like, especially for founders who might be not sure if You know, this is the best approach for them. 

Sean: Okay, so that goes back to your very first question, which some, what are the mistakes in outsourcing?

And, [00:13:00] uh, number, I mean, most people, I'll answer your question directly first, then I'll go backwards up to what I should have answered the first time. To answer your question, you should look at how, if it's an individual, you really don't have a lot of control, um, because an individual will do what an individual does, uh, based on their character.

So it's better to go with an outsourced agency that wants to stay in business for a long time. Because most agencies are in the business of providing engineering services as a business. They are not in the business of stealing their clients ideas and making a new product. And the advantage that they have, especially if you choose the right one, so you, so you want to look for, they've been in business for a bunch of years, and they've got a good client base.

Roster to prove that they're not going to steal your idea. Right? The 2nd thing is, um, you want to look at the company actually having engineers [00:14:00] that have done products in a similar space to what you're doing because this is your 1st time trying that thing. Let's say it's in health tech, um, and and you may know something about what the health tech sector needs in your domain.

Um, you don't know what else is going on. And, and, and it really helps to have somebody who's built a lot of health tech products because they understand rules and regulations around HIPAA and EMRs, um, they understand. Uh, the, the, the business and the workflow of a hospital or a, or a healthcare facility.

And so they understand user experiences in ways that you may not know. And the technical and legal requirements of those user experiences. So. You get a lot more from an engineering team that has been in the space and built similar products. And that's the advantage of the risk, right? The risk is, oh, these guys are going [00:15:00] to run away with my product.

No, they may use some of the knowledge that they've gained from working with you as they have with other clients to the advantage of accelerating your product. So that's Uh, so in terms of answering your question do the due diligence on the company make sure it's you're not dealing with just an individual Contractor on upwork who could run off and you're right I think it's a great idea because they've got nothing to lose but a company with you know 50 engineers is not going to want to go Um and steal your product 

Mehmet: great And thank you for mentioning, you know, the the part of upward because this was my next question And maybe here you can explain if you can explain shown to us You How exactly you help, um, you know, companies in this part, because again, I'm taking a scenario.

I'm a guy. I have no background. I have the idea. I validated it somehow, let's say, maybe by asking friends. And I know [00:16:00] like, if I build this an MVP, you know, I can again get solid feedback from people. So maybe then I can go even, as you said, continue bootstrapping it. Until I would need to scale it. Anyway, so I know that I have a good idea.

I need to build the MVP where I go. Okay. I'll tell you again, another story. A guy posted a job on one of similar, one of the sites, similar to Upwork. And he said, you know what? In matter of seconds, not even minutes. I was bombarded by all these, by these messages, by the way, not from individuals only, even from companies who are on these platforms like Upwork and others.

Now, here comes the challenge for me. How do I choose? Okay. You mentioned about the due diligence a little bit, you know, like there are hundreds, thousands over there. So how [00:17:00] would I know? And here, how do you help actually? In finding the right talent that suits their needs. 

Sean: That's an, so that's a great segue to what we do.

Um, yeah, we found that there was a gap in the market. Uh, you know, everyone's inbox, even without having posted a job, your inbox. Is daily, every day inundated with people offering their services from around the world, either BDRs and SDRs for go to market or, you know, lead generations. And, and then obviously software services, um, to build whatever you want to build.

And you just, there's just no way you can figure, you can figure a way through that mess. It's impossible. That's why we built this. Now Upwork does a pretty good job on gig workers and identifying, you know, previous contracts and recommendations. Um, there are some sites, you have to be very careful about sites that, uh, that allow for an advertising listing and they're promoted [00:18:00] because they spend more than the other companies.

So be very careful about sites like that. In our case, we basically went around. And what's funny is that if you ask any outsourcing engineering firm, Hey, I'm, I've like, if you said, I've got this great idea, it's in FinTech. I'm going to build play payment rails for blah, blah, blah. Can you do it? They'll all say yes, whether they've ever done it or not.

And they may have really good leadership in their engineering team that can talk to you in a way that's really, That will make you feel like they really get what you're talking about, and they understand it, and they're going to build it for you. Unfortunately, there's a lot of bait and switch in the interview process, and people get lost in that.

So even when you do due diligence, it's hard to get the real answers. So we've gone around and we basically asked, look, uh, we represent North American companies who are looking to expand their engineering capacity. And we don't know whether that's going to be one or a hundred people, but, uh, generally that's, that's, that is our client base.[00:19:00] 

And, um, and they are looking for good matches. So I want to ask you, if we were to bring you a company to your doorstep, what would, what business would it be in if it was the perfect match? Oh, we do marketplaces. Oh, we do, you know, health tech or, and then what kind of marketplace B2B, B2C in what domain, like fashion, logistics, what, so we get down to the granular and we tag the companies based on what their number one, two, and three business experiences have been because onboarding, as I described, knowing the rules, the workflows, the business logic of a company's structures.

Domain really helps quickly onboard them into what you're trying to do because they don't need to learn all that first part. That's about three months of onboarding, basically, if they're starting from scratch and they can contribute to product while they're building because they know this space. So that's, that's one way that we filter.[00:20:00] 

And then of course, the other way we filter is, um, domain tech stack, obviously that's just table stakes, but we, we want to know how much bench strength they have in the tech stack. So that if, you know, we hire, we bring in three or five contractors and. Maybe gross to 10, but one of them, it doesn't work out.

We know we've got others within their own bench that we can pull in to replace one, one that doesn't work out. So you can go with longevity with that client, with that vendor. And then the third, uh, probably the most important, but the one that gets the least attention is culture fit. And, you know, we're dealing with companies from Southeast Asia to, well, we used to deal with Russian companies, but not anymore, but, you know, very diversion, cultural cultures and helping, you know, if there's a cultural gap, there's also a communications gap.

What is, what does complete mean? What is, what does it mean when I, when I throw, if I throw something over the fence, is it going to get built in one country, in one [00:21:00] culture? In some cultures, absolutely, they'll get the full picture and they'll build it and they'll figure it all out. In other cultures, you need a very much more of a waterfall.

Do this, then do this, do this, do this kind of approach. So that's how we work. Um, and we fit, we don't do really the, the individual stuff. Like Upwork's pretty good at that. It's not a bad platform for that. Um, but if you need a team or if you know, if, if, and you don't need to be with Infosys or you know, the big, uh, Deloittes and IBM services companies in the middle, which is where most people live.

Uh, we're the, we're the ones who will do all that due diligence and make sure and bring, we have 80, 000 companies in our database. That's probably less than half of the world's engineering firms, which is insane when you think about how many are hitting your inbox. So we bring that down to basically the top 20.

And the key that we also look at, of course, is [00:22:00] Which engineers from that firm, even though the firm's done a lot of business in your space, and technically they got the right tech stack, they might not have the right people at the time we're asking. And you don't want them to go looking for them. You want them to have them because that's when you need them.

So we also validate the CVs of the people who are actually in the team that is available for the work at the time of asking. Because there's a lot of great firms that should be on the list, don't make the list because their team isn't available. 

Mehmet: Great. So Sean, have you seen any situation where after onboarding these engineers You know, there's a very good, uh, culture fit, there's, you know, some synergy that happens.

So they hire them full time. Have you seen something like this? 

Sean: Uh, that is interesting. Actually, we've had a few of those situations and those are hard to manage. Uh, there's, I'm not kidding. It's not, it's not, it's anathema. It's the [00:23:00] opposite of what the engineering firm wants to do. Yeah. That's a person who's a good engineer.

It took them a long time to hire them. They're part of their culture and they're going to lose that, uh, recurring revenue for the rest of, uh, that person's career, right? So they have to replace them. So we discourage that immensely. We try and negotiate a longer term, lower cost contract, which also is not really in the interest of the vendor because they, if that's a good engineer, they can rent that person for a lot higher rate in other places.

better some money than none. And, uh, in some cases, a company, you know, people have wanted to quit the company they're working for and go work for the other company or move to the country to the United States or Canada as the case may be. Um, and, uh, in that case, there's nothing we can do about it. We just say, look, Let's figure this out.

And the key is to have the conversation when it happens, right? Like you see, you post an ad, you can't do anything about posting an ad and having one of your [00:24:00] contractors answer the ad. That's not, you can't control that. Once that happens, if there's open communications, again, communications and culture and understanding all that is really important.

If it's a good relationship, you work it out. 

Mehmet: Great. Now, Sean, another thing we started to see, it's not a new concept. Probably, I think after pandemic people started to go to this approach where we, to manage these teams. Um, here a new, it's not new, as I said, but you know, the, the role of the fractional CTO or fractional, uh, VP of engineering, let's call it like this.

Started to emerge, right? So do you also provide these kinds or do you advise your clients? customers to, to, to hire fractional CTOs. And by the way, I have hosted a lot of them on the show. Uh, so if, if they are listening to us [00:25:00] today and saying hi, so yeah, but, but I mean, does that, I mean, um, continue or complete, let's say the, the, the, the full circle of what you're trying to do.

Sean: Yeah, I absolutely going back to what I said at the very about the startup situation, a fractional CTO is probably the best first thing you can do if you're not a domain, if you're not a technical expert, because that person should architect the best Uh, solution for you and, and give you that, uh, give you that strength without having to get the full time commit of that person.

And then maybe that person will also help you build the team and get your first VP of engineering, which would be your team lead to build the product. So you don't necessarily need the CTO day one, but you do need the CTOs. Experience and mindset and you don't, but you don't need it all the time. And that's, I think a very, I think that's a rightfully so [00:26:00] a very important piece of the puzzle and we use them all the time.

And if you have CTO, uh, fractional CTOs on your, on this, send, send me your, uh, resumes and your experience. Cause we do that a lot where we, we have somebody solution architect, Uh, for the client, sometimes it's a refactoring. A lot of, a lot of companies we deal with are in series a series B funding stage where they're, you know, they've bootstrapped this product, they built it on Ruby and, you know, copied and paste a bunch of code because they quickly had to get a client on board and stuff like that.

So just, or different areas of the, of the application. And they got sloppy about, about documentation. I mean, this all happens all the time, but they never addressed the technical debt because they keep growing. And now they've got investors. And now the investor is saying, Hey, you've got to really scale this.

And you're dealing with more tickets than you are in backlog of new product. [00:27:00] So, um, so what do you do? Well, you have to continue to support your existing application, but you have to re architect. And this is where I say that, sort of, you're, the engineer that got you to where you are might not be the one who gets you to the next step, and still might be the one who gets you to the next step.

But that's where a fractional CTO can come in really strong, who's been there, done that at the higher level, and can advise your engineer. That got you to where you are and help re architect for a much more scalable backend. 

Mehmet: And this is actually also the same, uh, I would say theory that, uh, all the fractional CTOs I interviewed explained to me moreover to your point Sean about, you know, which stage they are in.

So probably if they have someone in the very early stages, they need to give Some equity they need to give, you know, some I don't know stock options something like that [00:28:00] while They can skip this and avoid further delusions. I mean for for for their own Uh ownership in the company if they maybe You mentioned like maybe stage a or series a series b is the most appropriate time to have someone come fully on board and then start to build because they need to build also the not only the engineering team, they would need to build the support team.

They need to build a lot of other things also as well. So that makes sense. Yeah, a lot of sense, right? Uh, 

Sean: and if you've had that fractional engineer on your side the whole way that gives you going back to the, when the, when investors look at the, the core team, they'll, they'll give the funds to enable you to hire that fractional, that fractional CTO and into a full time role and give that person the appropriate.

Amount of stock. Cause a lot of people, you know, engineers are really good at solving problems, but not necessarily structuring. They're good at architecturing a software, but not necessarily good at architecturing the business. [00:29:00] And, uh, and that's a critical part. And, you know, if you think about it, you give away, like, if you're really generous, you want to give it 30 percent of the company to your engineer, because really think that's great engineer.

Well, how much is, if the company's worth a hundred million dollars, is is the engineer worth 30 million? Or a couple hundred grand over a couple of years. Um, and a little less stock, right? I mean, these, you have to figure what is your cost of money downstream in that equity give up every time you do those kinds of structures.

Mehmet: Great. Now, Sean, and this is, I'm asking the question because Touch base a little bit on it and you have it now in your company also as well. So AI you mentioned About co pilot and and you know a couple of other technologies that are out there How are you seeing AI playing a role in? This whole process like whether you know [00:30:00] helping the founders You know, internally, let's call it like this or finding the talent plus, you know, maybe expediting the whole, uh, product to the, to the market.

So, so how are you seeing, you know, AI playing the role here for, for these companies, especially in, in the, uh, early stage startup companies? 

Sean: Well, I feel sorry for heads of engineering at any company right now. Yeah. Yeah. Uh, because you're probably getting Higher, higher expectations on productivity and output because of what the CEO or the board is reading about AI and what it can deliver on.

And they're asking you also to shave cost out of your engineering budget, um, and, you know, leverage everything and, and it's really hard to keep up. It's changing so fast, but yes, [00:31:00] there is unequivocally. Accelerated output of, of, uh, productivity in engineering because of AI, not only in terms of writing the original code, but, and documenting it, you know, I would say 80 percent of what we write is, is with co pilot it's, and, and, you know, great prompt engineering is probably one of the best things you could get to if you're an engineer out there and you probably already know it anyway, but the, um, you know, So the expectations have risen in the business field for what AI can deliver, but execution is still, you know, it's up to engineers and engineers have, you know, it's the creative, the creative code of an engineer, the creative architecture of engineering is so far hard to replicate.

And, um, and so I think, you know, there's always going to be room for engineering, um, and really good engineers, but at the lower end, [00:32:00] um, it's going away. It's definitely going away. 

Mehmet: Wow. Like this is, uh, of course time would, would show us, but yeah, like definitely AI is, is, you know, I would say shaking this whole, uh, all industries, but specifically, you know, when it comes to engineering and, uh, Specifically these, these roles.

So yeah, we would see how, how that will, will, will evolve in that. I want to go back a little bit, Sean, to the due diligence. I know like you gave some hints over there, but are they like, for example, of course, You know, probably I would ask for what kind of projects these engineers have done before. Maybe I would ask for, for, you know, maybe their resumes.

I don't know what I should, what I really should be looking at when I'm screening, you know, these companies that [00:33:00] I'm gonna trust them and I'm gonna give them my You know my destiny maybe because either I will fail or I will succeed because of them So there must be like some some set of questions usually that helps me In doing the due diligence about this company and there might not be only technology related.

So if you can shed some light on that, John. 

Sean: Yeah, no, that's a, those are, there's a whole bunch of things. And actually I'm just about to publish a whole definitive guide on how to outsource. So it's got all the secret questions that we ask. Um, I really, the key is. You don't have any time and you certainly don't want to waste time talking to engineering firms that are a waste of time.

And unfortunately, most of them are a waste of time because they either don't have the domain expertise, they don't have the people available, they don't have the people available in the right tech [00:34:00] stack, Um, there's a big cultural gap, uh, all these, all these things that cause problems downstream that you only realize after it's too late.

So, I would say that first, I mean, and, and like I said, most people don't have time, so they don't have good data. Without good data, you can't make a good decision. So you just do a decision based on the short sample that you've got. And you've only got time to say, Hey, Mohammed, do you know anybody who's good?

And hopefully the person that you refer to has people available and they understand your business. It's a very slim chance. That's, that's actually going to hit if it does awesome, go for it. So what key questions can you ask? Well, you would obviously look for proof points that they have had experience in your domain, and you would want to talk to those customers.

But before you talk to those customers, here's what I would ask the agency when you're interviewing them. And you're usually interviewing, you're not interviewing the engineers before you're, [00:35:00] uh, you've interviewed the company itself. So ask them questions like, you know, what's, What's the churn rate in your company?

How? What's the turnover? Because you, you don't want to have engaged with the company and then find out that, you know, the engineers that you wanted or are leaving because there's a better offer at some other company. You want to have longevity of the engineering company, engineering team. Number two is all right.

So you say you've done this and you're going to show me powerpoints of all the great results. Great. What happens when shit hits the fan? Every project has some moment in it where something went bad. And so you want to know how they responded to that. And what you do is you look for how they answer that question.

Not just what they did, but look at their body language and how they answer it. Because you can get a sense of sincerity from it. And then the killer question I love to ask, uh, maybe I shouldn't say this on a podcast. Because people will be listening, but I really like to add, I say, look, okay, that's great.

Fantastic. He [00:36:00] answered it really well. You know that I'm doing due diligence. I'm going to ask the customer if that's how it went down. What are they going to say? And then look for the body language. They go, Oh God, don't ask my customer. Then, you know, you're not really dealing with sincerity in the answer in the first place.

They just gave you what you wanted to hear. So things like that, you can test the water. Um, but as I say, you know, going from 80, 000 companies to two or three, Is a, you know, in a matter of a couple of weeks is a much more data driven approach that will avoid all those problems, honestly, 39 percent of only 39 percent of projects are successful in outsourcing because people do the wrong approach.

20 percent of those unsuccessful are not completely unsuccessful. They're the 20 percent that have. Invested so much time and effort trying to get that team to work for them. They're, they just can't afford not to keep going. So they [00:37:00] keep going and they finally get it right. But it's so expensive, such a heavy lift.

You know, this, the company is your baby, you know, it's like taking your child to a daycare. You're not going to go to just any daycare you found on the internet. You want to do due diligence and know that it's the right place. So that's the level of thinking you have to go. What would you do, you know, in your due diligence of a daycare?

That's what you got to do for the outsourcing company, but you just don't have the time. So data driven is how we approach that problem. 

Mehmet: That's fantastic. I like, you know, this, uh, uh, these questions I would say, Make sense to see if they are really telling you the truth or to your point, they are just making up things.

And especially, you know, I didn't see that in engineering specifically, but one [00:38:00] thing is indeed, you need to ask about the bad moments because when it comes to other parts, like maybe, Lead generation sales marketing Like it's easy actually to fake some things It happened again. It happened to one of my close friends.

I would say Where, you know, the test, the, the guy gonna be, do the testimony for, for, for that company. And of course it was not very hard to figure out that it was like a setup . Right, right. Yeah. And, and if I think you use this approach, it's very useful because you can even catch, you know, such incident where someone is trying to.

Just make up things. So I like this very much shown in this, uh, you know, not only for engineering for, for anything, when you are hiring someone that you want to outsource things to, to, to them. 

Sean: That's the tip of the iceberg. There's a [00:39:00] whole bunch of stuff I can share. Uh, so if you, if you're interested in more, I don't have the, uh, guide yet available, but go to our website, sign up and, uh, and ask for the guide.

I'll make sure you 

Mehmet: absolutely, absolutely. Now, Yeah, of course, we're going to put that at, you know, in, in, uh, in the show notes. Um, so now back to, to the geographies and locations, how first, where, where are now the best talents in your opinion? Where, where are they? And other than the cultural differences and nuances, like you just mentioned, do you think like sometimes time zones might be also another showstopper for companies to hire these engineering companies?

A 

Sean: hundred percent. No, no. So, um, what I get a lot of people asking me that question, where are the best engineers or what's the best value? And, 

uh, [00:40:00] 

Sean: you can't answer that question based on a country. Uh, it's like saying, I want to build a hockey team. I'm going to throw a dart in Canada. If you look, I'm a skier, so you pick a Canadian, you're not going to necessarily get a hockey player.

So picking a country, terrible way to find an engineering, uh, team, except that, that you might find a cultural. There's less cultural barriers between you and the country of that you're thinking about. Um, but just about every country in the world has dealt with an American. Most of the mature companies in any country in the world have had American clients or Canadian clients.

Uh, Or British or, you know, European clients, they've had enough international experience that they're, they've done some bridging of the cultural gaps. Um, the answer about engineering, you know, it really depends on who's available at the time and that are the right fit. Uh, so it's not a geographic question.

We, what we do is we [00:41:00] start off with what are your time constraints? Like, is it important that they are in the same time zone? Boom, we eliminate. Most of the, most of the world and we sit within what we say, what's the, what's the halo you're willing to work with, as in, can you live with two hours difference, four hours difference?

So you've got a halo where there's enough overlap on engineering teams working together. That sort of is the parameter. Then what are your cost limitations? Um, and those, that's another parameter, but generally we suggest looking at cost after submissions because. As you know, an engineer that might be 35 an hour, uh, might be a great price, but an engineer that is 65 an hour might do four times as much in an hour as a 35 an hour engineer.

So, you know, uh, productivity is what you're really looking for and experience and, uh, you know, critical thinking and [00:42:00] communication style, all those things I think are more important than price until you get down to, uh, You know, four or five options that are all equal on all those respects. Then you look at price and, and a relative time zone, cultural gap and finalize your choice.

Um, but it's, you can't say, you can't say best engineers are in Ukraine or in Siberia or in Serbia. There are tons of really good ones. Like, honestly, you know, uh, the, one of the best things that Russian, uh, the USSR gave was engineering education, 

like 

Sean: any country that has been under Russian communist rule.

Um, previously has a legacy of phenomenal mathematics and phenomenal engineering mindset. Absolutely. But that is also true of Brazil and Argentina and other companies, a country, and Uruguay and Colombia, all these companies, countries in, [00:43:00] uh, South and Latin America are also really coming up. Vietnam, fantastic, but big cultural gap, hard language gap.

Um, you know, people think of India as, you know, the, the, the legacy mindset of India is, Oh, really low cost engineering. No people coming out of IITs in India are getting paid 250 grand without having worked a day because they are the smartest people In India, they're the, and that's, there's a lot of people in India.

So you have one fraction of 1 percent of the people get into IITs, man, Facebook, Google, they're all lined up at the door, uh, to get those people. So great engineers are, are, are available. They're just not equally distributed. They are in certain pockets around the world, but there's a lot of pockets. 

Mehmet: I love this approach, Sean.

And again, I want to repeat this. Don't go for the cheapest because, of course, I understand [00:44:00] you're bootstrapping, you're trying to still build, but at the end of the day, you don't need to do the work twice. And I have seen people who've paid double and triple because they were focusing only on cost. And I'm not saying that because sometimes someone is cheap, that means they are bad.

Probably like some of them, they want to, they want to prove themselves. So maybe the first project they get involved with their. You know willing to give that extra mile of discounting their prices because they want you to become a reference for them But yeah, like to your point, of course, you should look at productivity quality, of course of the work also as well because I've seen people I've seen people struggling, you know, and not coding, by the way, I'm talking about simple UI design, UX design, and these kinds of things.

So you need someone to understand what you're trying [00:45:00] to achieve so they can implement it also in the most effective way. So a hundred percent on that, uh, Sean. Now, um, because Sean you are into this space and you get all these requests and you And, you know, you, you facilitate, you know, between companies and the comp, the, the, the engineering firms that offer these services, are you seeing a certain trend currently?

Like people are willing to do more of, I don't know, FinTech, HR tech, like where are you seeing the most demand coming from? 

Sean: Um, I would say health tech and FinTech are very strong growth sectors, especially health tech. Um, uh, you know, SAS businesses are, are always, are always there, but they tend to start small and hire their own [00:46:00] engineering teams until they get to something really big.

But yeah, I would say the two high growth sectors are, um, FinTech and HealthTech. Prop tech is slowly coming up. Um, and then, you know, digital transformation, uh, etl grunt work, I would describe it as, um, is, is an ongoing business. There's still so many, you know, non technical businesses. That are recognizing the value of data or recognizing that their legacy systems need to be Um refactored and uh, and so that will never that that just seems to never end Um, and uh, so those those are the sectors i'd say are the strong.

Mehmet: Yeah, by the way, it's same here in in my area in in dubai and the Broader i would say middle east or middle east north africa region. So fintech is You Um, next comes HR [00:47:00] tech, a little bit of ed tech, education technology, prop tech for some reasons also it's picking up because everything is real estate here and there are a lot of investment in that area.

So prop tech is coming up. Uh, I wish to see more deep tech. I want to see more B2B SaaS. I wish to see more digital transformation. It's there, but as you mentioned, you know, the same, the same story seems everywhere. And, um, I think, you know, people to focus more on, on, on the value of the data at the end of the day.

Um, Sean, as we are close to an end, two things I want to, to ask you very quickly, your final thoughts, final, maybe advice you want to give. Um, for anyone who is considering outsourcing today and the other one, which is, I know it's written here, but again, where people can find more about you and about your [00:48:00] company.

Sean: Well, you can look me up on LinkedIn for sure. Uh, or Sean at outforce. ai. Um, and then, uh, in terms of final thoughts, I mean, look, if you're starting a business, Go fast. It's a speed. As you talked about, we talked about cost and engineering. I always tell my clients, look, it's a trilemma. You can go with cost, speed or quality, but you can't pick all three.

It's two, right? And so we solve for cost. Sorry, we don't solve for cost. We solve for quality and speed and we will get you the right team fast. But, um, cost comes as a third and a very distant third, as I described. And I recommend that for everybody else is you should look at how fast do you need, uh, to build up your team and, but focus primarily on quality.

Cause as you said, you don't want to waste time rewriting. Um, if [00:49:00] it's well architected and set up in the right, right, right way in the first place with a fractional CTO or a partner, um, then, uh, you're set up way, you know, it's just solve a lot of problems downstream that you don't want when you're growing.

Mehmet: Absolutely. And just to the point for people who are technically will understand that I'm saying, because Sean, you repeated a couple of times. Technical depth, and actually the previous episode, uh, with, uh, with Noah Krenton, it was about that specifically when, because he's a, he's a, uh, tech leadership co, uh, coach.

So it makes you headaches in the future, you know, technical depth on when you grow, uh, you need, you need to deal with it. So it's better to, Avoid that early stage to your point, you know, avoiding changing teams a lot bring a good quality team Even outsource to what we were discussing today. So that's absolutely, you know something [00:50:00] Very advisable, I would say so and you know, you reminded me of this I'm not sure if when the last time I've seen this, you know, the famous meme about you know project And you know, you can pick three, uh, sorry, you need to pick two out of three and then, you know, the fast and the cheap, and then you have the, uh, the good quality, but, uh, slow.

So, yeah, I believe what you mentioned resonates, especially for startups, because you need to be fast and you need to have quality at the same time. So, but this is, of course, would not be cheap. Um, it doesn't have 

Sean: to not be cheap. I mean, it's not gonna be cheap. It's it just doesn't have to be, it doesn't have to be expensive either though.

And that's the advantage of Outsourcing. Absolutely. 

Mehmet: Like, I mean, like not cheap in the sense, I mean, like zero, of course. But yeah, so, so these are the two things they need to focus on is quality and [00:51:00] speed, because if they are not getting good quality products, Their competition would get, would get them there.

And if they are not shipping fast, again, the same thing, they would be left behind. So absolutely, absolutely. You know, it makes sense. Um, and Sean, 

Sean: yeah, please, before you go, you talked about technical debt. One of the, one of the ways to avoid technical debt is to be disciplined in your sprints and every six months do a two week sprint.

That is not new product. It's technical that just, you know, if you don't factor it into your life, into your life cycle of engineering, um, it will just build up and build up and, and it will be the bane of your existence. You'll be firefighting instead of building. 

Mehmet: Absolutely. Again, like I've seen a lot of stories, uh, around technical depth.

So yeah, perfectly set, Sean. Well, Sean, you know, I really enjoyed the [00:52:00] conversation and, um, I hope, you know, the, uh, you know, we can do another maybe episode in the future because this topic can go for hours and hours and hours. So, yeah, thank you for all your insights you gave today. I'm very happy because we touched, I believe, on majority of the points that founders, they need to think about, especially we discussed about, they should not be afraid of, you know, giving the work to an outsource company.

We discussed, you know, about what are the things they need to. Take care of the due diligence, the quality of, you know, the skills that they need to look at and all this stuff. And of course what we discussed at the end. So, you know, I really, as I said, thank you very much for all these insights. People can find more on outforce.

ai and I'm going to put this also in the show notes and this is usually how I end my episodes. So this is for the audience. If you just discovered this podcast now. Thank you very much for passing [00:53:00] by. I hope you enjoyed. Please, if you do, subscribe and share it with your friends and colleagues. And if you are one of the loyal followers who keep, you know, listening to us and keep sending us their comments, thank you very much.

Keep them coming. And, uh, also, as I mentioned in every Episode. And if you are interested in coming to the show, because you are doing something different, you're helping startups in a way or another, you have a great idea, you're trying to build it and you want some push to get it out to the world, don't hesitate to reach out to me.

We can make it time zones is not an issue. Sean is in Canada. I'm in Dubai. So. We can still arrange for a time. I even had guests in New Zealand, which is like, you know, on the other side of the world, I would say, and we still did it. So reach out. Don't be shy. Thank you very much for tuning in and we will be again with you in a new episode.

Thank you very much. Bye bye. 

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