Welcome to Tectastic, the podcast that explores the cutting edge world of technology and its impact on society. New breakthroughs and developments are revolutionized the world around us, presenting exciting opportunities as well as complex challenges. We'll explore the big ideas and key players driving these transformation as we seek to understand the implications of these advancements for our lives, our communities, and our planet.
Join us on this journey of discovery and exploration as we navigate the fascinating and ever evolving world of technology. This is welcome. It's techtastic, and it's lovely to have you here. It's fantastic to be. Are you no pun intended? It's fantastic to be here. Thank you for having me, Chris. Yeah. So you're you've got a great profile. You've got, what, 25 years experience in the tech industry. You've had 5 startups that you've launched.
Which means you're a serial entrepreneur, whether you like that title or not. It's unemployable is the main reason, I guess. Yeah. Yeah. And the only person that would hire me is me. That's kind of the definition of a serial entrepreneur. Yeah. Or else you just keep seeing problems you need to solve, and, you can't help yourself with point you realize there's a business behind it. So, yeah. And today, you've got outforce.ai.
Yeah. I Hammer interesting journey What I really like to do is to help people figure out the dos and don'ts of outsourcing, like whether or not they use our service or not. I emphasize we're not a recruiter. We're not an outsourcing agency. We help navigate through all the agencies that are out there if you get better matches. No. As the audience does, I Hammer a long career. I've been, the CTO at some fairly large companies. I've had a long tech career. I did a lot of stars before that.
And one of the things that was common is I talked a lot about tech debt as a reoccurring problem. Yeah. That's what I company actually is very much focused on solving in a, like, automated fashion. The typical way we would have solved that though is, like, there's 3 things you can do. You can throw people at it. Mhmm. You can erase the past tech debt every placing everything, so modernize. Mhmm. Or you can monitor the heck out of it. You can instrument it.
You can build a CICD pipeline and then spend years trying to pay off that backlog of stuff. Oh, yeah. Yeah. All of them expensive. Yep. The easiest one to sell the senior leadership, if you're, like, a director VP level is gonna hire more people for whatever reason that works. And the easiest way to do that is to say I'm gonna staff aug. I'm gonna bring in contractor So it's a outsourcing light kind of way. Like, they're contract to hire, maybe, but they're definitely not permanent all the time.
Right. And that way you describe is very typical of our customer base. And that has an interesting problem when you're the, you know, the person's gonna be signing a few vendors on board. Mhmm. The first is you really just don't know the quality of the people. They've got their own bench. Yep. Right? They've got people they want, they they wanna bring in. You have no idea whether a good culture fit, whether they're a good, like, do we have the seniority and the skill set to really match up?
So you're taking a lot of it on trust. And trust usually have a referral. Right. Hey. These guys are great. I use them for my health tech company. Oh, we're we're in different sub build, but they they have they have great engineers. Don't worry about it. Yeah. Exactly. Difficult issue. Yeah. And when you're getting into it, like, the the other thing you have to trust is, like, how are they gonna fit into this? Do they follow a process that we agree with?
Do they fit into our cadence or our rituals and all that kind of fun stuff or not? And if not, how do we manage that? So there's a bunch of questions around who you bring in, and I know what I've always done is I go back to the exact same people that worked for me past, I go back and say Because you've been through that learning curve. That's right. And that's the only group I trust, which is very limiting. It doesn't give me the best options on potentially price.
It doesn't give me the best options on. Maybe skill set, but I know I can trust Karen, so I hire Karen's team to come in and do it. Exactly. And Karen will go find the contractors that she needs to do or whatever. Right? Totally makes sense. And I commend you for actually still going down with sourcing Hammer to go through the the heavy lift of getting them to make it work for you. Right? And that's the challenge is outsourcing totally lacks trust. It's it's like your baby.
You know, you're you built this company. You've got, you know, 10 engineers, maybe, maybe 20 or whatever. You don't just give your baby to any random day care center. You go and find out all the best runs and figure out who's had a good experience and then make sure that's the right one for your kid. It's the same thing with your product and engineering. So you have to really do some due diligence. And the problem is nobody has the time to do due diligence.
So they lack the data in order to make a viable Christian, and they more so even lack a process. Mhmm. The interviewing part is to key to figuring out all those issues that you just described. What's the culture? What's the rituals? What's the cultural gap if I'm in a different country? You just touched on a really big problem, which is time zone differences. If you've got a team in, like, in India and you've got a team on the West Coast of the United States, they're 12 hours opposite.
Which you can take advantage of having 24 by 7, you know, around the clock development. But Yeah. But you have none of that halo stand ups. Right. Right. And having built those companies, every time we hit some inflection point, either, you know, we needed something ready for a show, or we got a big client with it needed an API, or front end, or, you know, like you said, you know, we hate we we bootstrap this crap on Ruby on rails. Well, guess what?
That gets messy after a while, and you got, like you said, technical debt, but I still need to service my customers. So I have to bring in these other people to come in and build the new product while I'm still servicing my existing customers. So for any of those reasons, you end up going outsourcing. Mhmm. And it is a nightmare. It's the opposite of hiring. In hiring everyone's good at taken. So you gotta pull them out of a company even today. And you flip the switch and go, okay.
Well, now I gotta outsource Christian it's water water everywhere, but not a drop to drink. You said earlier, it's like your baby too. And, I I was thinking about that going, yeah, it is a lot like bringing in a baby. Consider, like, in getting that level of trust. Yeah. And with outsourcing, in particular, especially when you've got a large org, the sheer volume of agencies that come to you and say, Hey. I can beat your rates.
I've got a 100 engineers, you know, ready to go at any time for your project. It's just a nonstop every day. You get 3 or 4 requests for a meeting with some vendor that wants come in and get their 100 software engineers on your project. And you No ice. Yeah. And you just ignore it all because you have no ability to to and whether or not they're valuable or not.
They might have the best engineers on earth, and maybe they give you a streaming deal because they're just sitting on the bench waiting for work to do. You have no way to find that out. There's no way to know. Exactly. And if you end up asking somebody, can you do something? Guess what the answer is. Yes. Of course. Right? Because we're the experts in it. We've got a whole team of experts ready to go.
Exactly. So that's what I the problem I we solve with workforce is really how do you filter all crap and figure out who's actually good at what you wanna do. And not only are they good on paper, but they have the right people at the time that you're asking. That's Christian. Right? So, like, your friend who's got a good dev shop might not have any good people at the time that you ask, and therefore, that you're just kicking your hiring problem down the road. Right?
So we really look at Electrolema. There's three things. There's speed, quality, and cost. Mhmm. You can only pick 2. Mhmm. And we don't solve for cost. Cost comes as a byproduct of maybe picking a geography with the lower cost base, but we only look for solving on getting the right people at the right time and the quality of that. And so we start with the database. It's massive. We have about almost 80,000 companies in our database. And we don't ask them, can you do this? We've asked them, hey.
We represent North American companies are looking to scale up and they're engineering through staff aug or whatever the use case may be. If I brought you the perfect client, what business would it be in? And then they go, oh, we're a marketplace company. We've built 100 of marketplace. Oh, great. What kind of marketplaces, B2B, B2C, logistics, so we get into the subcategories.
But now at least I know that they've got domain expertise so that when you start with them, don't have to teach them the business logic and the business rules or whatever the criteria may be, health tech, fintech. That's really important stuff. And then the next question is, and in what tech stack? Oh, you know, we're dot net junk or we're, you know, in JavaScript. And so how many people on the bench on that? So now I know that I've got them tagged for that tech in that domain.
And if I come to them, I'm gonna ask them. And if they get the contract, probably only gonna get 4 or 5 people to start a contract, but I know that I can go deeper and longer with them because they've got the strength. Or if the client only stays with, you know, 3 or 5 engineers for this deal. Sometimes, you know, in the interview process, one slides under the radar and the interview doesn't say a lot of things. It ends up being that very introverted engineer can't take criticism.
On paper was excellent, but in soft skills, not so great. So you need to replace that person. And that's where we know that We've picked that company because we can go and back to them and say, hey. Jose's not working out. Give me 3 options for Jose for next Christian we get those 3 options in front of you. And next thing you know, Juan's gone. Jose's in. Everyone's happy and the payment's communicating really well.
One of the things that you realize when you go from, like, the small company or, like, divisional 150 software engineer type team up into the 100 and 1000 is that your view of your responsibility changes, right, you're no longer thinking about optimizing performance you're no longer thinking about efficiency, you're thinking about risks and outsourcing by its very nature and technology is extraordinarily high risk. Christian? Intellectual properties walking out the door on that person leaves.
All that effort I put into training them on the domain, training them on our tech stock, It's knowledge that we need to keep in house. And so fundamentally as a CTO in a larger company, you are broadinarily resistant to outsourcing any 100%. However, you have no choice. Right? You you just don't.
There's no way you can possibly do all the things you need within the budget constraints that you have, especially when you're a publicly traded company, you get your OpEx and CapEx and you've gotta maintain a certain level of burn that the street's gonna acknowledge And then you've got things that have to get done. And so you you're always playing that game of like, okay. How much risk am I gonna absorb by taking in? So you give you give the, what we call, parallel swimming lane stuff.
Like, it's not core. It's the APIs that I need to build for a third party. It's the, it's that front end. It's that other stuff, right? Until you build confidence with that firm and they're But you still wanna know that I've got there's an enduring value here. I'm gonna have a relationship with this vendor because the vendor selection itself at a big company is also time consuming 100%. Inexpensive. Yeah. And so the last thing you wanna do is say like, well, they sucked.
I need to go find somebody else because that's a 3 month journey starting all over again. It is, you know, you know, how in the cycle of a startup is always that you get a 1st couple customers and you get this peak excitement. And then you drop into the trough of despair. It's the same thing with outsourcing if you do it on your own. Like, this is the problem. People interview the leadership of the agency who tell you everything you wanna hear. We do at the bottom up.
We go, given the resumes of the team you're gonna that you're gonna send us, we'll meet them, figure what the cultural gap is, language skills, and all those things, soft skills. So on paper, we understand what they're like. And then we let the client interview those teams, the top 5 teams they wanna Mead, and we only let the management speak at the very end about the culture of the company. As opposed to the other way around, you need the managers, the CTO of the company.
They tell you everything you wanna hear. And then they find whoever the hell they can find to fill the contract. Yep. It's eye opening when you you're on the other side of it. I did enough time between companies before got into the big company gig for a while, I would just pick up contract work because it's fairly lucrative. And if you're good at what you do, it's easy to get. And to be on the other side of it and, like, hear what they were pitching me as. It's like I can't do that.
I don't think I've ever done that before. Before. Exactly. And and and that's the beauty, but when we get to the finals in this process, which usually takes about a couple by the time you get interviews done. There's usually 2 or 3 companies where not only does the company have the domain experience, and they got the benches I described, but there's a pot of engineers that have just come off a similar project. They've built 3 or 4 of my client's building.
And, you know, 1+1 equals 5 in engineering when you got people who work together. These people are finishing each other's senses, and they're contributing to product more than my client can contribute because that is her or his first time doing this business. You just described the main reason outsourcing is actually valuable if you can find the right team. It's the thing. I call it the McKinsey effect because that's kind of what they're known for. Right?
They go around and they see how everybody's done supply chain. Right. For example, they've been at 500 companies doing this. And so by the time they get to you, they're like, Here's the 500 things we've seen done wrong that we're not gonna have you do. You're gonna do this instead. Now they know 501 wrong things to do, and they're gonna go to the next one, right, with that knowledge. You'll never have that internally. You just can't do it. Your one use case.
You really should leverage it, but, like, how do you derisk it how do we how do we engage? Like, what's I find the McKinsey in your business. Right? And that's what we want. It's just like we had one client. It was building a Basko banking as a service company. So the infrastructure underneath a bank. But Google was an investor, so they had to go with Go Lay. Try and find senior DevOps with 15 years of experience. In banking, who knows go? There aren't any because goes up at home.
At the time, it was only five years old. So they had the head of former head Accenture Global Partnerships was their engineering lead. He said, I don't need you guys. I I know everybody. Came back 2 months later, he said, I know a lot of people. They're just thought the right ones. So we'll give you guys a chance. In 3 weeks, we had 7 companies. And like I said, 2 of them had teams that are just coming off building a go in Europe, they were like, no. You should do it this way.
You should do it this way. It was gold. Gold. So the problem with banking technology has always been Koball layer that you just can't get past. I know. I get requests for cobalt developers. So that's another unique of engineering that's, few people. You pay me $10,000,000 a year, and I'll start doing cobalt again. We do get that from the time. Yeah. So, yeah, so that's that's what's cool. And and I'm I'm sure some of your audience might be starting their 1st company.
You know, a lot of people think I'm gonna build this engineering team and then we're gonna go to market with the product. That's a great idea if you've done the research on whether the product has a market fit.
And will we get sometimes there are people who, you know, they've been around the horn a few times kind of like me and they go, Hey, I don't want to give up all my equity to not paying my buddy an engineer to build the company and then find out when we get the venture capital money that the venture capital company is saying, Hey, that's not rate guy to lead your engineering team to the end zone, and I have to have that hard conversation.
No. I'd rather raise a little bit of dough, spend it on an engineering team that knows my space can build my POC, figure out if I got product market fit once I get it, then hire my engineering team and build around that. Pleasure to meet with you. The excellent joy. Christian, hey, thank you. That was awesome and not our last conversation by any stretch. And that's a wrap for this episode of Tectastic. I wanna thank you personally for joining us, and we'll see you next time.
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