IT Outsourcing: Pros and Cons for Startups

Written by Scott Craig|Posted on December 19, 2022

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With the increasing tech demands required to stay competitive in today’s digital economy, many startups are turning to IT outsourcing as a way to keep up with current tech trends and requirements. There are several reasons why IT outsourcing can help your business grow and meet its goals, as well as a few potential risks to be aware of.

Reasons to Choose IT Outsourcing

  • Cost Savings – IT outsourcing is generally more cost-effective than hiring your own IT team. You can contract a nearshore team that works at a competitive rate. The outsourcing company also has its own equipment and infrastructure in place, saving you money on overhead.
  • Access to Experts – The ongoing IT talent shortage makes it hard to find software developers, especially if you need specialists in trending technologies such as blockchain or mobile app development. IT outsourcing companies should already have a network of experts for your team with experience in delivering high-quality products.
  • Flexibility – Outsourcing allows you to quickly adapt to market changes, upscaling or downscaling the team if you need to add new features, expedite a product, or adjust your budget.
  • Reduced Risk – By working with an experienced IT company, it is more likely the project will be completed on time and within budget.

Potential Challenges of IT Outsourcing

  • Intellectual Property Risk – Outsourced developers will have access to some of your intellectual property, so there is some risk of theft. Protect your trade secrets with a non-disclosure agreement (NDA) before starting work with a new partner.
  • Monitoring – It’s a leap of faith to trust your project to another organization, but a reputable IT outsourcing company will offer a clear communication structure and a dashboard to monitor progress.
  • Language and Cultural Barriers – Outsourcing to another country can lead to communication issues, so it is important to make sure that your partner has professionals who speak English, or even have some staff based in your country.
  • Non-Aligned Time Zones – Related to the previous point, a large time zone difference can significantly disrupt communications. It is preferable to choose a company whose time zone is aligned with yours. The above challenges can be addressed early by partnering with an experienced IT outsourcing company with a proven track record of results. Always discuss these points before hiring!

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Scott Craig

Scott Craig



Kirkland, WA, USA

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