I think most of us would agree that if you’re trying to make your startup succeed, you can’t just totally outsource your product design or product engineering to someone else and simply hope for the best.
It’s hard enough to succeed if you’re already a designer or developer, working all hours of the day to try and figure out what your users need and how to find product/market fit.
Outsourcing your product build is dangerous, and hard to get right. There are plenty of reasons why you shouldn’t do it.
A lot of advice that you’ll see online will take variations of ‘fake it until you make it’, ‘eat your own dogfood’ and also the general idea of figuring out how to do pretty much everything by yourself, and maintaining that for as long as you can, before succumbing to the urge to pass it on to someone else.
And it’s true: from a basic financial standpoint, it’s often hard to get the right kind of value if you hire an agency to help you build a product, and that stems from it being difficult to align your interests. The agency needs to make money in order to keep their business going (at an oversimplified level, the more they charge you, the more successful they’ll be) and you need to keep costs to a minimum in order to try and build a successful product before your money runs out.
Then there’s the difficulty of anyone outside your team fully understanding your needs, along with all the knowledge you’ve gathered so far. How can you expect a bunch of outsiders to jump in and totally understand all of this? Trying to get your product build at arm’s length is a recipe for disaster.
On top of that, it’s very tough to build a successful product if your business model dictates that you’ll be permanently dependent on an agency. One of the hardest things to get right when you’re building a company is culture, and the way you design and build your product is a part of that. You’ll need to develop your own culture, not rely on someone else’s forever, even if their culture is truly great. If you’re not doing that, then what will hold your product and business together?
But there’s still a place for a certain kind of help
The classic reason for hiring an agency is that they have the capacity to do better work than you’d be able to do yourself. Despite the many risks that come with trying to get someone else to help you build your product, there are some situations where you can find that your interests are aligned with an agency or freelancers. I do firmly believe that there’s a very valuable role for the design industry to play when helping people to build products, in these specific situations.
First up, there’s the obvious benefit to bringing someone in (especially if they’re an expert at what you’re trying to get done) in order to provide a valuable fresh perspective. Even when we (as a design team) try to build our own products, we can find ourselves getting too close to the problem to be able to spot more obvious solutions. Bringing in a team to help out for a short period can really help you to get over this hurdle.
Agencies tend to have really solid processes, and also work with a lot of startups–this can be really valuable perspective to learn from, even if you’re pretty experienced yourself. We found this when we worked with Transcense recently: their team had undoubted skills, but was still able to learn many new techniques from us, and also benefited from being able to experience our design thinking process first-hand.
Hiring external help can be expensive, but that doesn’t mean it’s not good value.
Of course, the typical scenario for bringing an agency in to help is when you need to get something done, but you know it’s not a long-term need that you want to hire for. You’ll pay a higher rate for the time it takes to get the work done, but it’ll still be a better value option overall.
Sometimes you just don’t have the budget to make a full-time hire, and being able to bring in help ‘on demand’ can keep your costs lower and be a smart decision. In recent years in ‘hot’ major startup cities, many companies have struggled to find available talent for the budget they have available, so design firms have filled this gap. This is another situation where it can make sense to think about paying someone to help you build your product.
We’ve also found that many startups can benefit from our help when the talent is available and they have the budget, but they don’t want to rush through hiring a whole design team. If your situation requires you to hire 3 or 4 designers, you don’t want to make the wrong hires. But you don’t necessarily have time to put the product on hold while you look for these people. Bringing in an external, fully-formed team can help you to fill that gap, and working with experienced designers might even help you to understand the kind of designers you want to look to hire full-time later on. We’ve seen this several times when we’ve worked with funded startups, who’ve had pressure from investors to move fast and launch their product, but didn’t have a design team of their own to do this.
But be careful. There are a few things that you definitely need to do, if you hire an agency.
Everyone who works in our industry has horror stories about terrible agencies and teams they’ve seen, or even worse, have had the displeasure to work with. You might be in one of the situations I’ve just described, but hiring the wrong agency or team to help you will just leave you in an even worse position.
There are a couple of things that I think are absolutely critical to have in mind if you’re considering looking for an agency to help you build your product:
- You need to find the right kind of team. If you’re not culturally attuned, you’re going to struggle to do great work together. You also need to trust each other, and be sure that the team thinks they can deliver real value on your project. We’ve turned down many projects in the past because we thought the potential client would be better off with setting up a basic Squarespace site of their own before asking us for help–this kind of mentality is really important, or you’ll quickly find those interests getting out of alignment.
- You need to be collaborating closely. This applies to almost every situation, except where you’re hiring a team to help give a totally fresh perspective, and you don’t want to affect this. In every other case, the way to overcome the flaws of outsourced product development is to work so closely that it doesn’t seem like you’re working with an external team at all. If you’re thinking of it as ‘outsourcing’, that tends to indicate that you’re going to have issues. This is the model that Pivotal Labs adopt, where their developers will pair with your own, and they’ll often ask for you (as the product owner) to be on-site with them. It’s a model we’ve tried to replicate here at Hanno too: if our client has a designer on their team who can team up with us, that’s a huge bonus and usually leads to particularly strong results.
- You need an exit strategy. I think it’s extremely rare that you’ll have perfect alignment of interests forever. I’ve found that the best way to engage an agency is to know what you want to get out of it. Often, the arrangement is a means to an end, and that’s perfectly fine: we all know that long term, it’s likely to be cheaper to hire your own team if you have the work for them to tackle, rather than to rely on an agency forever. We’ve seen lots of demand from startups asking us to help them prototype a very lean MVP so that they can try and raise funding on the back of this–for them, the engagement between us is a way to get this done smartly. This is a great example of working with an agency and still having a clear exit strategy for the relationship, with an idea of what’s next.
There are certainly many situations where hiring an agency or team to help you build your product is a crazy decision. But there are many others where it makes perfect sense, as long as you have an understanding of what you need from the relationship. The hope is that you’ll be able to find a team that’s the right fit for what you need to get done.