Why we built our core engineering team outside of Silicon Valley
Building Virtual Bridges
Flashback to late 2017: As an early stage startup based in the San Francisco Bay Area, we at Prism Labs, were faced with the following grim reality after leaving the friendly confines of Y Combinator in the fall of 2017, having just raised money.
Building out our engineering team in the hyper-competitive market for talent in the Bay Area simply wasn’t a viable option anymore.
For many startups in a similar position to ours, building a remote development team is no longer an option, but the only option, given the rapid rise in bay area cost of living which has in-turn, skyrocketed salaries for hiring engineers, leading to a never-ending cycle of increased costs.
Faced with an ever-increasing denominator of the ‘build’ vs ‘buy’ equation in terms of acquiring the right talent for our startup, the costs no longer made sense given the tradeoffs.
A new reality sets in
After coming to the stark conclusion that we needed to home-grow our distributed engineering team, we started to examine each challenge in a more systematic way.
Upon taking a closer look, the perceived tradeoffs involved with navigating increased communication overhead and different timezones gaps all while maintaining a strong culture, were no longer the insurmountable impediments that we previously thought them to be, but instead, just another set of solvable challenges to be overcome while building out our company.
A new reality: The number of engineers in countries like India with top skills working for a fraction of the pay of their U.S based counterparts is incredibly high. While many U.S based startups like ours were struggling to find the right talent (at the right price) for their job openings, there is a whole different problem on the talent side.
After analyzing the salary data, it became clear that these gaps were huge:
In some cases the differences in salaries were not just 5x, but 10x–15x higher for similar roles.
Reality check: For each engineer that we hired in the Bay Area, we could have potentially hired 10–15 outside of it. Everyone has heard of 10x engineers, but what they don’t tell you is that the Bay Area doesn’t have a monopoly on them.
Once you venture outside your Zip Code, you start to realize that these 10x engineers exist everywhere, they are just much more highly concentrated in the Valley.
We were promised that the internet would have massive flattening effects on the flow of information, and it has to a large extent. Why then haven’t we seen the educational and work opportunities follow course?
A “Bridge” is missing. A technology bridge which helps to uplevel existing skills and update for new industries. A communication bridge between demand and supply of talent is missing. An educational bridge to help pass along the tacit knowledge of experts. A cultural bridge which could help enable upcoming talent overseas to start working with top US startups.
First we thought we were crazy. What would our investors think? What would our colleagues say when they heard we had “outsourced” our engineering to another country.
Why is no-one else doing this? Or are they just not talking about it?
What has changed in the world (beyond the exponential increase in the cost of living in the bay area) that is making an alternative to the traditional model viable now?
- Silicon Valley is exporting its know-how to the rest of the world (willing or not) — through the availability of educational content being churned out by its practitioners, we have inadvertently begun sewing the seeds of our own disruption, by exporting our greatest cultural asset, our tacit knowledge around startup creation and company building.
- Silicon Valley is exporting its future talent at an increasing rate — due to misguided and shortsighted immigration policy at a national level, The United States is no longer the obvious first choice for the world’s top talent to flock to start their careers.
- The tools are *almost* there — from communication tools, to development tools, we are just starting to get to a place where the tools we use to develop new technology are finally living up to the innovation of the tech industry itself.
An Experiment: Building a Bridge
Back to our story: After struggling to hire top-notch engineers in the bay area as salaries started to spiral beyond reason, we decided to conduct a radical experiment in trying to train overseas developer talent on our tech stack before hiring them.
It worked…and worked, and worked again.
After hiring three engineers, we’ve now given up the prospects of having a central headquarters and are committed to building our entire team as a geographically distributed one.
This realization led us to a major shift in our focus as well.
Now through Bridge Academy, we’ve now have formalized our process for screening, training, mentoring and ultimately on-boarding top engineers with a methodical approach that helps them not only bridge technical but also cultural gaps and are opening it up to other companies.
If you are interested in joining us on this crazy journey, you can check us out below, and follow us on twitter here!