How to Get Good Offshore Developers

A really effective way of bootstrapping your start-up is to offshoreand outsource your development. But doing this also carries risks, howcan you be sure that you are going to get a developer who'll see itthrough and has the right experience? This post lays out an effectiveprocess to find the right developer.
From starting the search, to the first developer writing code,should take around 3-5 months and there may be further delays whilstyou complete your documentation. In this article I'll talk you throughwhat you should be doing at each stage, and what the objective of eachstage should be. Here's an overview of the process:

Build a long list of development companies
NDA all the companies on the long-list
Issue a Request for Information (RFI)
Analyse responses and short-list the developers
Issue a Request for Quotation (RFQ)
Analyse responses and select a preferred vendor and a spare
Negotiate contract with preferred vendor
Commence development based on your documentation

This is a long process, and therefore I've split it up into 4sections. These will be posted each week for the next four weeks.Regular readers of this series can relax: the whole lot has beenwritten in advance, so there won't be any month long gaps in between!

Findinga great development company is one of the most important decisions yourcompany will make. Changing developers mid-way through a development isnear impossible and so it is important that you select a company whichyou are confident has the ability to see it through. The purpose ofthis 8-step process is to stack the odds in your favor by finding outas much as possible about the development company before you sign thecontract.
At several stages I've included sample documentation to give youmore guidance on what should be included. You can download theseexamples from the documentation bank on Aroxo.
Before we start, one word of advice. Running a vendor selectionprocess will involve giving a large number of developers bad news (andonly one company good news). When I first started doing this I foundthe process of giving bad news quite unpleasant. It is, but it is stillimportant to do it. Vendors are used to receiving rejections, so theytend to take it more easily than expected and I also find that givingthe bad news, along with some personalised feedback, is always muchappreciated.
Step 1: Build a long-list
Before we start populating a long-list, it is worth spending a fewminutes getting properly organised, as running a vendor selectionprocess involves a lot of time, organisation and communication. I findit easiest to run these off a spreadsheet. There's a sample vendordashboard included in the documentation bank.
Building a long list involves populating this dashboard. The aim isto get 20-30 companies into the dashboard that satisfy your broadrequirements for the type of system you want to build. You want to makesure that each company has:

Experience in building the type of system you're lookingfor (if you think your system is entirely new, it almost certainlyisn't, there will be parallels which you can look for - even if thoseare purely functional elements)
Experience working with start-ups
Offices somewhere in the world where you are happy doing business
Experience in the technology you want your system built in (if you don't have a preference, then ignore this)

By far and away the hardest of these objectives to meet is thefirst. You may need to contact many companies to determine whether theyhave built a similar application to the one you're looking for.
In order to find companies, there are a few tricks you can employ:

Use your network: ask anyone you know who works in the software industry for 2-3 development company recommendations
Use referral companies to provide connections and act as a filter
Use associations to help pinpoint development companies
Use tools like eLance, Scriptlance and Rentacoder to find developers
Use Google to help find companies
Whenyou've found a company you like, do a reverse search for their homepageon Google to see if they belong to any associations with links to othercompanies

You may need to look through a large number before you've found 20-30 companies which can meet the 4 requirements set out above.
Step 2: NDA everyone
You're a start-up (I'll return to this point later), so an NDAoffers no protection. If you've got funds to sue a company then,frankly, they would be better spent fixing the mistake with a newdeveloper. However, it is still essential that you NDA all the vendors,even though you are not going to be providing them with anyconfidential information (other than of your existence, just yet).
First thing you'll need is an actual NDA. There are plenty you candownload for free on the web, so I've not provided one. Read it to makesure that you are comfortable with everything included in it. If you'veselected a lawyer at this stage, ask them to provide an NDA, but don'tpay them to write out a new one.
Email it to all the developers on your long-list and ask them to faxor scan signed copies back; and make sure there's a deadline for returnin your email. When you receive one back, open up the Vendor Dashboardand update it so that you don't forget you've received it. Then printit out and file it.
When you hit the deadline, ignore any further submissions. If thedevelopment company can't meet this simple deadline. they are not goingto meet any further deadlines.
In next week's post I'll detail how to write and issue an RFI; and then short-list your developers.