Startups, Tighten Your Belts

There are a lot of indicators that we’ve reached the peak of the [venture-capital] investment cycle,” PitchBook analyst Daniel Cook told the L.A. Times.

Evidence of decreasing startup deal flow and slower funding activities has been creeping up towards end of  2015  I have personally heard this from several angels and VC attorneys. Although funding activities for seed and early stage startups will likely continue in 2016, competition for capital is definitely on the increase.  Angel investors and early stage VCs will be scrutinizing the startups and demanding traction on your product and marketing reach.  Many startups will need to look carefully into their bottom line and cut down on expenses so they can extend their runway before the next round of funding.

Depending on how far down the product development line, if you haven’t looked into the possibility of reducing the cost of operation by outsourcing and comparing costs of a US based development team versus a remote team overseas,  it should be an exercise worth tackling.

Here’s a quick comparison of developer Salaries in different regions

Junior Developers Mid Level Developers Senior Developers
Experience 0-2 Years 2-5 Years 5+ Years
San Francisco $90,000 per year + 25% in stock options & benefits

$112,500 per year
($9375 per month / $56 per hour)

$120,000 per year + 25% in stock options + benefits

$150,000 per year
($12,500 per month / $75 per hour)

$150,000 per year + 25% in stock options + benefits
$187,500 per year($15,625 per month / $94 per hour)
Ukraine $50,000 per year

($4,166 per month / $25 per hour)

$80,000 per year

($6,600 per month / $40 per hour)

$150,000 per year

($12,500 per month / $75 per hour)

India $30,000 per year

($2500 per month / $15 per hour)

$50,000 per year

($4,200 per month / $25 per hour)

$80,000 per year

($6,600 per month / $40.00 per hour)

Southeast Asia $30,000 per year

($2500 per month / $15 per hour)

$50,000 per year

($4,200 per month / $25 per hour)

$80,000 per year

($6,600 per month / $40.00 per hour)

Americas $50,000 per year

($4,166 per month / $25 per hour)

$100,000 per year

($8,300 per month / $50 per hour)

$150,000 per year

($12,500 per month / $75 per hour)

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Hiring the right team and the right developers to create the appropriate solution for you whether is MVP (Minimum Viable Product) / Prototype or turning the MVP into production grade application require a knowledgeable with the right experience.   Typically, this is done by a technical co-founder or an advisor specially if you don’t have experience working with remote developers.  Here are some tips to help you get started.

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