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Hiring a remote developer while scaling up a company – 5 must know facts

Hiring a remote developer while scaling up a company – 5 must know facts

Do not wait; the time will never be 'just right'. Start where you stand, and work with whatever tools you may have at your command, and better tools will be found as you go along, said George Herbert many years ago.

Business development is always experimental. Looking back at the beginning of the building process while scaling up in the present, most entrepreneurs admit it has been a complicated but worthwhile road to take. There is no single strategy that everyone can follow that helps a startup expand profitably. However, growing from a humble $0 to becoming a million-dollar company while accelerating your product development, requires having the right people on board.

Necessity dictates that some of these people must be software developers or remote developers if you hit the wall in your local job market. That’s why the right strategy of hiring remote developers is essential for the business.

How many developers does a scaling startup need? The answer is never straightforward because it all depends on the complexity of the product or service you want to deliver and the desired schedule. Ideally, it should be as few as you can get away with while still getting the job done. Startup resources are often limited, especially when it comes to spending money. In this article, we want to share with you essential information you must know before hiring a remote developer while your startup transitions to a scale-up.

1. At which stage of product development does your company need a remote developer?

You’re scaling up a business, so you have probably already gone through some of the product development phases. At this point, you are aware it’s not enough that you believe your product is marvelous, your ideal clients also need to see a value in it.If you want to switch from thinking into doing, you need to make sure your potential customers will self-identify with your product. Its’ developments should be based on their needs.

Seek to find out what you must offer and carefully consider the answers to essential questions such as:

  • Why does a person need my product?
  • What problem does my product solve?
  • How does my product differ from those competitors offer?
  • How much would customers be willing to pay for it?
  • What is the market potential?
  • What technology will I need to create it?

Arriving at the right answer to the last question is critical for product development. Thoughtless information technology strategy can be very costly. Before you make any decision on programming languages, ecosystems or platforms, consult with a person who is knowledgeable enough to understand the technical side of a product and can explain the impact each decision will make on your finances.

You need a developer in a very early phase of your product development if you don’t have any technical experience. As soon as you are done with a concept generation and want to move into product specification.

It is important, to begin with, the basics. Don’t expect to receive a finished product built in a complex system on the first attempt. Be careful not to establish far higher goals then you can realistically achieve because you might unnecessarily overspend on infrastructure. Down the line, you will then need to make budget cuts. Instead, hire a remote developer first, who will build the one core function of the product you’re making in the simplest possible fashion. It will also help you discover technical caveats. After this step, you’ll see what actions must be taken next.

If you are a CEO or a product owner who will work with software developers, you need to be aware that you might start with one, but sooner or later you will need a team and not just a single technical individual.

Product development also requires you to specify what kind of product you are making as this will affect your decision making regarding who you might actually need to hire and what skills will be required. Some software developers choose to work on a specific program or app, while others create networks or underlying systems required to get the program started. In essence, there are two main classifications of developers:

  • Systems Software Developers – Their primary role is to analyze the needs of the user to create, test, and develop software that will solve a problem. They also set operational specifications, formulate, and analyze software requirements.
  • Software Applications Developers – Their primary role is to develop and modify computer or mobile application software customizing it for customer use. This involves operational efficiency optimization, carrying out analysis, and designing databases within an application area.

To further continue product development, you may need to create a team of developers with each team member handling a different role based on their skills. For example, a team that includes a Front End Developer, a Back End Developer, and a DevOps Engineer.

No matter who are you looking for, it is worth considering hiring a  remote developer. It will help to increase your startup resources by lowering costs and raising the chance of finding a highly skilled employee.

Click here to download the ITCraftship ebook

2. Why is telecommuting the future of start-ups and scale-ups?

Once you’ve defined your product development stage and you decide it’s an opportune moment to hire a remote developer, you may ask yourself the question ‘Why not find a programmer who will work with us on-site?’ The majority of entrepreneurs still assume that having an employee in the office is the best method to ensure guidance, maintain engagement, and keep track of employee performance.

However, according to Buffer’s State of Remote Work Report – 99% of respondents would like to try working remotely for at least part of their career. In addition, more than 90% also confirmed that they had encouraged others to try out telecommuting.

Once employees go remote – they won’t come back. 90% of Buffer’s respondents admitted they plan to work remotely to the end of their career. What does this mean for employers?

Telecommuting will take over the job market, especially when it comes to highly desirable professions.

A pie chart showing the biggest benefits of working remotely in 2019

It’s more than just a short term trend. Remote work is here to stay. The flexibility that comes with cannot be replaced by other benefits. Remote employees have the possibility to adjust work to their lifestyle. It’s the most significant perk that helps them gain the work-life balance they need – this explains why, once they try telecommuting, they never want to come back to regular commuting. 

You may know some of the 100% distributed companies like Close.io, Zapier, and Clevertech. They attract hundreds of interested candidates monthly thanks to their remote policy. Additionally, companies like Apple, Amazon, and Dell have already jumped on the remote bandwagon. It’s already quite difficult to compete with their employer brands, corporate salaries, and all the benefits they offer, without even considering the remote working options they now provide.

Why are telecommuting teams the future of startups?

If the company you manage is in an early development stage, then you may see that your current startup resources aren’t sufficient for growth. Why might telecommuting be the solution you’re looking for?

You don’t limit your talent pool

Having an office in a tech hub like New York City, London or Tokyo, allows you to be a part of one of the best startup ecosystems. However, when it comes to looking for the right software developer, you may find yourself up against a wall, especially if you don’t have the resources as a startup to compete with the big players.

The only solution is to stop limiting yourself to a location and give remote work a chance. There are great professionals in other, less developed countries, who’d love to work for you and have high motivation. Why ask your employees to commute to work for a few hours daily if they can telecommute.

You can afford a more skilled professional

While scaling a startup, you’re looking for budget cuts everywhere. However, if you stumble upon a great remote developer in Brazil, Venezuela, or in Europe – Romania, Serbia, Poland… you may find that they’re substantially cheaper than on-site developers in the USA or Western Europe. For the price of a mid-level developer in your city, you can afford to hire a great senior remote developer in another country who may very well offer a higher skill level.

You can afford a recruitment agency

If you make some budget cuts, thanks to a lower salary you’ll pay your future remote teammates, then you may spend some of your savings on help with recruitment. Using the services of an experienced technical recruiter or recruitment agency that specializes in finding developers may save you many hours.

The time you or your HR team would need to spend on screening CVs, preparing and checking technical assignments, or conducting technical interviews can be used for other important tasks. You can spend this time developing your business!

Startup employees expect flexibility

When people join a startup (an environment usually associated with agile and flexible management) they look for a level of trust in their skills and time management. The best way to relay that you believe in their professionalism is to promote telecommuting. Empowering them to do their job on their terms, allowing them to self-managing their tasks according to schedule and lifestyle.

You may have a concern that you won’t be able to control your remote developer, but in most cases, it’s unnecessary to do so. In a survey conducted by SurePayroll, 86% of professionals who took  part said that “they prefer to work alone” in order to “hit maximum productivity.”

Those who work remote at least once a month are 24% more likely to feel happy and productive in their roles than those who don't or can't work remotely. According to the Global State of Remote Work report released by Owl Labs

3. How big is the budget you need to hire a remote developer?

Let’s say you’re an American entrepreneur, building your startup from scratch in New York. You want to hire a Mid Back End Developer to join your team as soon as possible.If you want to do it yourself with the internal resources you have to take into consideration this might take anywhere from a month – (which is very fast,) to more than several months. During that time the productivity loss to your whole team can cost you tens of thousands of dollars!

Adding in the actual cost of recruitment (which could amount to yet another $30k,) and the total cost is substantial. If you decide to use a recruitment agency, then you’ll have to pay from 15% to 30% of the developer’s yearly salary. An average software engineer pay in NYC amounts to around $110,000/year. This number may differ depending on the level of programming expertise that you may require. 

That means, on average, you’d have to pay from $16.5k to $33k – although this is quite similar to the cost you would incur if you were recruiting on your own – but without impact to your team productivity. This is before even taking into consideration overhead expenses incurred on office space for your future Back End Developer such as electricity, internet, and other necessary media. Are you able to handle all of this? 

If you don’t have a big team and any funding yet, the answer is probably not, nor would you want to use all of your startup resources on hiring. By the time onboarding is finalised, you could have achieved so much more with your current team concerning your product development.

A bar chart showing the cost breakdown of hiring a software developer in NYC

In comparison, the average software developer salary in Brazil amounts to R$86,298/year (or US$23,000) It means that a remote developer in the same time zone can be up to 5 times cheaper! Additionally, you don’t have to pay for things like office space in NYC (which can be obscenely expensive), electricity, and other expenses.

That said, we would encourage remote entrepreneurs to provide other benefits for their telecommuting employees, like a desk in a coworking space, additional money for the computer hardware which is necessary to get the job done, a good headset which helps in remote communication, and other perks.

Click here to download the ITCraftship ebook

Trying out a recruitment agency may also save you some money when it turns out you hired a developer who doesn’t really match your company. Let’s say you managed to hire a great, experienced, and talented Mid Back End Developer on-site, in New York. They have worked with you for a month already, but something is not right. You have heard feedback that they are not a good team fit, or don’t deliver expected results, and your product development doesn’t go any further. You may try to work it out but ultimately may have to get rid of the developer.

What are the consequences? Well, all that money, effort and startup resources that you put in the recruitment process – more or less go to waste. Sadly, you’ll have to go through all of it yet again and spend the same amounts on exactly the same process. So, how could using a recruitment agency may save you money? Many technical recruiters have a clause in their contracts concerning finding a replacement if their candidate leaves the job or is fired during the trial.

Following the calculation prepared by Devskiller - It takes on average 8.8 weeks for a bad hire to be dismissed. That means that you have to pay all of the recruitment ($31,940), onboarding expenses ($7,546.5), salary ($23,311.48), rent ($1,184.62), office supplies ($33.85), and productivity loss (roughly the same as the salary as presumably a bad hire will not be moving towards peak efficiency) which leaves you almost 15 weeks into the year with a $87,327.91 bill and nothing to show for it.

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So, to sum up – hiring a Back End Developer on your own can cost you around $60k considering the recruitment process expense and the cost of your team’s lost productivity. If you decide to use the services of an external recruitment agency, then you have to pay around $20k-$40k. You can hire a Mid Back End Developer on-site for the price of two great remote Senior Back End Developers. You make additional budget savings if you decide to hire a telecommuting employee – which can then be allocated to your next remote employee or further product development.

4. Where to find a remote developer?

Flexible schedule and work-from-home opportunities play a major role in an employee’s decision to take or leave a job. Employees are pushing companies to break down the long-established structures and policies that traditionally have influenced their workdays. The State of the American Workplace report by Gallup

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Telecommuting is a growing trend as it provides many benefits for both employees and employers; irrespective of if your company is a startup, scale-up, or big corporation. Of course, while it cannot be denied that it is great having an employee at hand and on the spot in the office, developments in online tools for remote co-operation, render distance an almost negligible a limitation.

Research strongly suggests that fewer job seekers relocate for new positions. According to the Canadian Employee Relocation Council, the number of Canadian employees who would relocate abroad for a job has declined from 25% in 2012 to 18% in 2017.

A bar chart showing an average annual relocation rate

Where to look for a remote software developer?

An onsite software developer is getting harder to find because the demand for employees in the IT industry is rising faster than average when compared with all other occupations. According to the Bureau of Labor Statistics, the employment of software developers will increase by 24% from 2016 to 2026. Therefore, hiring a remote developer may be the best solution while you are scaling up a company. Fortunately, there are a number of places where you can reach remote IT employees to enlarge your startup resources.

A bar chart showing the projection of the IT employment in the US

Recruitment platforms

When you are looking for a full-time remote developer for your scale-up or startup, you may reach out to recruitment platforms that connect companies to software developers who have already been in their database. 

After signing up, a client is usually set up with a representative, who acts as a liaison between them and remote developers. There is no need to screen through lots of applications.

Additionally, recruitment platforms often have a trademark system for vetting talent. If a remote developer wants to join a platform and become a part of their community they must first go through a screening process – a tech assignment that in some way proves their coding skills – achieving a satisfying result.

Freelance marketplace

To find a Back End Developer or Front End Developer for a single project, a company can search for pages where anybody who works as a freelancer can join. Some of the freelance websites offer their custom matching software, where you look for a remote developer with specific skills and coding language knowledge by using their search algorithms. 

This makes the sourcing process quicker. However, software developers who join freelance marketplaces are rarely screened, so the responsibility to check their skills lies with the company. Unfortunately, interviewing dozens of candidates is very time-consuming. So you may need to settle in for the long haul.

Job board platforms/Communities of developers

As an example, there are many online job boards where you can post a job ad and announce that you are looking for a Senior Back End Developer (for your company). However, it is better to stick to job boards geared toward tech talent such as – WeWorkRemotely, RemoteOK, AngelList, StartupMatcher, Dice, GitHub, StackOverflow, and a few others – to raise the chance that a needed remote developer will apply.

It’s good to be aware that unless you have a big brand these advertisements may not attract a huge volume of applicants. Good developers are never unemployed. It is worth considering that, you can post a job listing for a relatively small fee while others have pay per click policy that can turn out quite pricey. Some of the job board platforms also gather a community of developers on the web, where remote developers share their experience and learn more about coding.

LinkedIn

LinkedIn, as a vast professional networking platform, can also be a good place to find a remote developer. However, it requires active sourcing. You, or a person from your team, will need to contact lots of people directly and ask them about working for you. 

The key to finding the right group of people who are interested in your offer lies in being relevant. Many of your potential candidates might have already been put-off by getting offers that don’t apply to their skills. Also, in today’s job market for software developers, you need to sell your job and have engaging messaging to catch your remote developer’s interest. On top of that, it might be necessary to use additional tools like LinkedIn Sales Navigator, and Recruiter to find a remote developer who is the best match for the role.

Recruitment agency

Besides all of these options, you may decide to use the services of a recruitment agency like ours (ITCraftship). There are many reasons why it is worth outsourcing recruiting.

First of all – time. Every day that a developer position remains unfilled slows down the company’s work and burdens startup resources. Also, the whole recruitment process, in general, takes about 10-20 weeks, from the moment the remote developer is found to his employment.

A Recruitment agency shortens that time (it usually takes us up to 4-6 weeks). There is also a distinct improvement in the quality of the delivered candidate. Each recruitment agency often provides its screening process that allows delivering a highly skilled professional that fully matches the company’s needs.

Click here to download the ITCraftship ebook

5. What should your technical recruiter know?

If you decide to take advantage of working with a recruitment agency you don’t need to worry about sourcing and screening candidates. An agency will use solely their resources. This includes know-how, methodology, technology (tools), company staff and also time to provide what you expect – a remote developer who is prepared to start working in your company as soon as you decide to sign up an agreement. It makes hiring a remote developer easier. That said, you may also choose to complement this with your HR resources or anybody of your team who has at least some technical knowledge.

Value tech screening over sourcing

Your technical recruiter should know that not sourcing but screening software candidates is the essential task. There might be many remote developers interested in a job you offer, but you need to separate the wheat from the chaff, so to speak, to find your developer superstar.

Try to design a simplified technical challenge that mimics one of the issues you have in store now. This will help you find a software developer who can manage the tasks needed. Despite this, always remember that there is no “one size fits all” approach to technical screening.

Adjust the level of difficulty

Before you take a remote developer through a heavy screening process that involves several steps, your technical recruiter ought to make sure it’s practical and test it before shipping it off to your candidates.

You have to adjust the level of difficulty, type of questions, and coding tasks to match the kind of role as well as seniority. From a junior developer, you’d expect to have good problem-solving skills and a fresh academic mind that is eager to learn and showcase algorithmic capabilities. From more senior developers you’ll expect a better understanding of good programming patterns and practices.

A mid or senior developer might be better for a remote position

Telecommuting requires some onsite experience first. Remote work at the beginning slows down the development of skills to some extent. A junior developer often lacks the courage to ask as many questions as would be necessary to improve their skills, even though there are now great tools for remote collaboration.

Also, solving problems and cooperating on tasks (eg, pair programming) or viewing the code together with the remote team (peer reviews) is a bit difficult for someone at the start of their career. It requires proactivity because other members may not have enough time to help someone else with the task. Your technical recruiter should make sure that a remote developer has at least 3 years of experience.

Analyze what you need before you start

As a recruitment agency, at the very beginning of every recruitment process, before we start working with a given client, we discuss the company’s needs. During this interview, we collect and analyze the main tasks that the software developer will perform on a daily basis. Your technical recruiter needs to have clarity about your expectations as well as an understanding of what particular frameworks, libraries, architecture, and infrastructure your company is using.

This means the remote developer can hit the ground running when joining your team. Always remember to make sure that the position itself is suitable for remote employment and whether the company is prepared for it. Not preparing for a recruitment process often results in involving a candidate in time-consuming processes that might not bring the expected result or desired return on investment.

Some more tips on hiring a remote developer:

  1. If you want to take better care of your candidate experience, check out this checklist prepared by Lewis Stowe, which you can use to provide a great remote developer experience.
  2. If you need to expand your knowledge or look for someone who can help you with preparing your teams for telecommuting, check out Remote-how Academy
  3. If you want to learn more about how to start screening remote engineers by your own technical recruiter, check out this Hacker Rank’s post.

Hiring a remote developer superstar can be faster, find out how we can help you by reading more about our services. If want to know what makes software developers crave the job you offer, what scares them off, and how to make them fall into your pipeline – download our ebookSoftware Developers’ Insights on Hiring