Active investment is highly context sensitive. I'm not denying someone might be plausibly in a position with sufficient information, domain knowledge, connections and a small amount of capital to operate as you suggested.
Your claim that operating on this manner is the obvious best choice for everyone is highly controversial. For starters, private investment requires trust and communication and just the culture barrier to understand the true rules of business and engagement are non-trivial for someone who's native culture is for example northern european.
Basically, I'm totally clueless. I have no idea how to a) hire an indian software dev for a few thousands b) what value added activity I should require of them and c) to whom to sell their work to.
I do know, however, how to invest into low cost index funds with reputable finance organizations. Thus the latter from economic perspective is a highly more enticing option.
I presume you have some specific situation in mind. Perhaps you could give some 'hypothetical' scenarios and what their profit model is?