
The subtleties in outsourcing using RentACoder - epi0Bauqu
http://blog.cubeofm.com/the-subtleties-in-outsourcing-using-rentacode
======
andrewljohnson
I've had experience using online sites to source jobs, and I think this advice
is right on.

Here are some summary points, generalized away from rent-a-coder:

* don't hire Americans to do commodity work (i.e. PHP CRUD)

* be clear but not ominous in your job description, and include visual mocks if at all possible

* don't try and be secretive - no one wants your dumb idea anyways

* make sure someone has a decent reputation on the site you use

* keep track of the progress of the product and keep in touch with the coder, but don't be overbearing

* be somewhat flexible with the deliverable - aim for perfect but accept done

* test the code thoroughly and request fixes in one shot, but don't conflate new features with bug fixes or no one will be happy

The only points I would modify are:

* Job requests can include bullets, but don't be overly fine-grained.

* You can in fact build relationships with outsourcers via rent-a-coder (MTurk, 99Designs, etc), and you should - this will lead to much better long-term work. A good way to get this started is an unexpected bonus.

* Don't ever screw someone on work. This is just karmically bad. They live in Eastern Europe and are poor. You live in America and are rich. I think the best way is to give someone a piece of work (5-10 hours worth), ask them for a bill, and proceed from there. If the work sucks or is over-billed, you pay and move on. Otherwise, you can give them more work.

~~~
fnid2
_don't hire Americans to do commodity work (i.e. PHP CRUD)_

This is why Americans are saying they are from overseas to get the jobs. If
the price is the same, what does it matter where they are from? Speaking a
common primary language and being in the same time zone has value.

When I offshore work, I send an email and have to wait until the next day to
get a response. When the worker is in my timezone and I get quick responses,
the project success rate improves.

I agree with the other points and have been on both sides of the payer/worker
transaction.

~~~
mrkurt
If the prices are the same, the American probably isn't as
skilled/experienced.

~~~
lsc
have you hired anyone from overseas? have you hired an American for overseas
wages?

I've done both, and the amount of money a person can charge has a lot less to
do with skill and experience than you think. Several people who worked for me
for sustenance wages now make more money than I do because other people
noticed that they are pretty good.

Selling yourself is a skill, and it has very little overlap with the skills
required to be a good Engineer.

~~~
mrkurt
That sounds like the very definition of gaining experience to me. :)

I'm sure there are exceptions, but on aggregate I'd be shocked if you can find
Americans to build something for you as, say, equivalently skilled Romanians.
There are millions of reasons you'd elect to pay more for the Americans, but
the localized standards of living at a given rate are going to keep Romanians
cheaper at the equivalent skill levels.

That said, it sounds like you have more experience with this than I do, so
this may be that one time in 2010 I'm simply wrong. ;)

~~~
lsc
As for experience, yeah, these people were more valuable after working for me
than before; but at least some of these people had decent paying jobs before,
then lost them in the downturn, lost hope, and ended up doing menial jobs.

One was the classic example; this guy happened to be my roommate at one point.
He was obviously brilliant, but he practically radiated self-doubt. He had
this slouch that took a few inches of his height and make him look a little
like he thought you were going to hit him.

But he was obviously brilliant, and had worked as a C/C++ programmer for a
while, he even had some open-source code out there. But he lost his job during
the .com crash and had been subsisting since on savings, menial jobs and an
occasional elance-type gig.

oh man, and his lack of confidence absolutely killed him there. He had this
one client who'd call him up for hours every night and kept adding features
and changing requirements. He said he made $2/hr on the gig when he said he
was quitting. At that point I think he was into me some for rent, so I offered
to hire him at $40/hr. I called up his customer and explained that I'd get the
work done for $60/hr, but he couldn't talk to my friend, and that he'd be
paying for phone, time, too (I was, well, quite a bit younger at the time. 22?
23? and thought $60/hr was a fine wage for yelling at/getting yelled at by
some asshole. I was just figuring out the whole 'if you are arrogant and
aggressive, people give you what you want' thing.) The job got done, and
everyone got paid, and my ego got stroked. (I mean, yeah, the wages were not
awesome, but eh, when you are that age, it's certainly a living wage)

Really, once you got down to coding, my friend's apparent self-doubt
evaporated like it was just an illusion. "I don't write segmentation faults"
he insisted. But he did really badly in interviews. But my point was that he
was really good before he worked for me; but that fact was obscured by the
year or two of downtime after the .com crash. My friend eventually got noticed
by a real recruiter, and got a full-time job shortly thereafter. he currently
works for some compiler company or something making rather a lot more money
than I do. (more than I was making when I left my full-time job... my current
business pays me, ah, mostly in equity.)

obviously, one anecdote does not equal statistical significance; I'm just
saying, I've seen people with experience fall behind in the 'interview arms
race' and end up underemployed, to the detriment of their potential employers.
Because it is so hard to sort the really good people from the mediocre or the
useless, there is huge value that can be had correcting the market's mistakes.

~~~
mrkurt
After reading this, I'm pretty sure we generally agree but I didn't really say
much in my first comment. Anything approaching full time work is really going
to work differently than Rent-A-Coder style projects. I would expect the costs
for my mythical Romanians to approach the costs of an American like your
roommate, though their actual hourly rate might be cheaper.

I will try to be more explicit next time I make a throwaway one-line comment.

------
wallop
Extremely well-written, concise-but-detailed, no-bullshit guide to a process
that I have shied away from because it seemed to involve a lot of mysterious
complexities.

The author's recommendations provide extremely reasonable advice to follow in
any project management endeavor. He emphasizes an assertive but respectful
approach, taking the needs of both sides of the project into consideration and
outlines a wide range of practical details that you could only know about from
having a high degree of first-hand familiarity with this service.

I'm saving this and hope to draw on it soon, now that it doesn't seem quite so
daunting. Thanks for posting.

------
scorpioxy
Interesting article. Some inaccuracies: \- "Rentacoder does not have skilled
developers from western countries. What it has are freelancers from countries
like Romania, India, Pakistan and Russia."

Nope. It has developers from all over(I live in Lebanon). Freelance
programmers are simply programmers that don't work exclusively for one client.
I am guessing you don't mean this in a bad way...

\- "The availability of particular skills is very limited."

I started my freelance career on RAC 4 years ago. 6 months into it, i was
taking on bigger projects using some of the technologies you mentioned(I'm a
python guy but also do C# and Java...). Roughly 8 months into it, i was
working with start ups and people were contacting me directly even though my
rates are not the cheapest.

I no longer look for gigs on RAC, but its certainly a viable lively hood if
you're picky with the projects you take on. The trick is to always be honest
and decent, the way you should behave in real life.

I also found it funny that some Indian companies started outsourcing projects
to me.

~~~
lzm
I'm from Latin America, and just recently I started using sites like
RentACoder/oDesk/Elance. I've found that it is extremely hard for me to get
jobs on these sites, especially since I'm not a webdesigner (I'm a
C/C++/Python/Java guy). What tips and strategies do you recommend that
increase the likelihood of being selected for a job?

~~~
mixmax
A friend of mine needs a small project done (videocompression and storage with
a webbased frontend) and has asked me where to get it done. I referred him to
rentacoder and elance, but I'd much rather refer him to someone from HN. If
you're interested (or if anyone else is for that matter) you can send me a
mail and I'll get you in touch with the guy. My mail is max (at) maximise.dk

------
patio11
This is my favorite genre of HN post: news you can use backed by real
experience. I don't necessarily agree with all of the advice but a few bits in
there are eyeopening for me. (For example, I had never known that the
newsletter was a key channel for getting your project seen. That's the sort of
non-obvious insight that is worth its weight in gold.)

Thanks Max.

~~~
scorpioxy
Well, not just newsletters. I still subscribe to the RAC RSS feed even though
I haven't done any RAC work for quite a while. It was easier to just skim the
headlines in my reader and tag the ones i replied to for later reference.

It has nothing to do with the newsletter. But setting too low a price gives
the message that you're not serious about the work or are just trying to find
someone to take advantage of(and you will if that's what you're looking for).

------
jacquesm
What a super article. It is actually really good reading too for anybody that
manages programmers and/or designers, outside the context of rent-a-coder.

Things like scope creep and how to return beta reviews are really spelled out
well.

------
jackfoxy
Suppose I have a real company, and I want to expense or capitalize this. Does
anyone have experience with IRS rules on this? What if the guy is in the U.S.?
Do I have to send a 1099 to every coder I rent in this fashion to protect
myself and my company?

~~~
bestes
I used oDesk and found that because it is a corporation, I don't need to send
them a 1099. And, because all the people work for you through the company, you
don't have to do anything special.

~~~
jackfoxy
thanks

------
tom_ilsinszki
"For C++ and more complex projects, you can pick from the U.S and Europe." – I
never thought programming languages where area-dependent.

~~~
robryan
People feel more comfortable giving out simple work in something like PHP to
cheaper countries which in some cases can come back to bite you with more
complex stuff as a decent size C++ project can be.

------
10ren
What size project would you typically get done for the $450-$550 mentioned?

I'm intrigued that this might be a way to get some small projects done I've
been putting off done (like a simple shopping cart app with a few specific
functions, that I just can't get interested in.)

~~~
maxklein
For $250 you could get your shopping cart app done. Think of about $200 - $400
for a weeks work (fulltime) by a competent programmer. Then estimate how long
it will take him and put that price.

~~~
kungfooey
Wow, $200 a week for 40 hours. That works out to $5 an hour. Is that a livable
wage even in Eastern Europe?

I think I need to find another trade.

~~~
scorpioxy
I highly doubt it is.

$200 a week can definitely get you a shopping cart. But so can $10. And I am
not sure how well it will work.

Usually for that kind of money you'd get someone customizing or re-branding an
off-the-shelf open source one or some programmer trying his hand out at
writing it from scratch. Use of open source components is fine and probably
the way to go but its not ethical if you don't tell your client that you're
doing so otherwise use a framework.

I'd say something like $500 should get you a shopping cart with the regular
functionality. Probably $200 for customizing an existing off-the-shelf one.

Of course these are just my opinions and experience, so they might be
completely off target.

~~~
robryan
You get what you pay for, just in terms of what the freelancer perceives to be
decent money. Paying someone from a cheaper country $5 an hour will probably
give the same kind of hacky late rush job that giving someone local $10 an
hour.

------
rubyrescue
This is great stuff and worth referring back to when you initiate a project.

My experiences as a hiring manager have been from having a dude stiff me for
$800 of work, to hiring a full-time developer I found on rentacoder that
became a personal friend.

------
josh33
Can anyone comment on which site is best? I recognize this might lead to more
traffic on your site, but it would help to understand why one would use
rentacoder over getafreelancer...

------
lsc
wow, this is really interesting to hear; See, I thought that nearly all work
on these type sites (my experience has been with e-lance, many years ago) had
mechanisms for paying people through the site, but from what I saw, only the
first transaction was done that way. After that, the contractor and contractee
worked directly, so it's interesting to read that some people found enough
value in the structure provided by the site to continue using it after meeting
a person.

~~~
scorpioxy
Well, some people just use it for payment later on if they don't want the
hassle of wire transfers and such.

For RAC, they used to charge 10% of the transaction value so it could build
up. My experience was that most people contacted me off site after our first
project but sometimes still used RAC for payment because it was easier for
them(I can't use paypal). Although they were nice enough to take on the 10%
charge.

------
wellwatch
Does anyone know of RentACoder style sites for signal processing?

~~~
scorpioxy
You can always try and post that on RAC and see if anyone bites, but i think
you'd find more people who work on that on dedicated forums or groups.

------
aneth
After some experience outsourcing through RAC, I've concluded that paying more
for local developers and designers who buy into and understand your product
and business model, speak the same language, and share your culture, is often
worth it.

Unless your product is extremely straightforward and doesn't need to be
flexible in the future, there is a huge hidden cost when your developers
aren't on the same page. In my experience, the result is far from "agile."

