Local startups hire global help via online service

Freelancing websites like oDesk let startups hire help from around the world.

Freelancing website oDesk seeks to address a skills gap and save money for startups by connecting Australian businesses with freelancers from around the world, according to the company’s CEO, Gary Swart.

However, in an interview with Computerworld Australia, Swart dismissed the idea that the American company is outsourcing programming and other computer jobs that might have gone to Australians.

“Australia, per capita, is the largest country on oDesk,” said Swart. The gross per capita value of transactions by Australian companies using the service was double that of US companies.

The website has registered 550,000 businesses and 2.9 million contractors in 160 countries. In Australia, the site has registered 35,000 businesses and “tens of thousands” of contractors.

Swart said one reason oDesk has found success in Australia is that it allows companies to tap a talent pool from around the world. One oDesk customer recently told Swart he “couldn’t find the talent [he] needed locally in Sydney,” he said.

In the fourth quarter of 2012, Australian businesses spent the most money hiring from the Philippines, according to figures from oDesk. That was followed by India, the US, China, Pakistan, Ukraine, Russia, Bangladesh and—finally—Australia.

However, Swart said oDesk should not be viewed as outsourcing.

“We don’t really call it outsourcing. We think of it as staff augmentation.”

“Outsourcing implies throwing something over the wall and getting something back,” he said. “This is more about you and I working together over the long term as a direct, one-to-one relationship.”

Swart positioned oDesk as a cost saver for startups and other small businesses who may not be able to afford hiring locally.

“You have work that you need done but you have this paradox of trying to get more work done with limited resources,” he said.

Hiring local, on-premise and permanent employees is expensive, time consuming and competitive, he said. Hiring local temps is too expensive for small businesses “and it’s B-minus talent,” he said.

One oDesk customer who runs a Sydney-based startup said his company would not be able to get off the ground if not for programmers from Russia and the Ukraine that he found through oDesk.

“I think some people have the impression that it is sending jobs offshore,” said Adam Griffiths, the founder of 1Ad.com. Griffiths said he could not afford to hire Australians through traditional methods.

“If you hire someone here you have to hire them for 40 hours a week,” he said. He estimated that would have cost twice as much as hiring the eastern European contractors through oDesk.

“I just couldn’t have afforded to do it without [oDesk] to get it off the ground,” he said. “But once it succeeds I’ll be hiring people within the country most definitely.”

Swart said that Australian contractors are also finding jobs, with about 57 per cent of their work coming from international companies, he said.

Rony Charchar, a freelancer doing Web design and development from Melbourne, said he’s done contract work for 30 companies in the last one-and-a-half years via oDesk.

Through three digital agencies in Australia, Charchar has worked on projects for football clubs and large TV brands, he said.

While he has worked on projects for companies in the US and India, Charchar said most clients have been Australian, he said.

“I’m guessing [it’s] because they like the fact I’m based in Australia as well.”

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Case study: hiring online

Griffiths, a Sydney railway engineer by day, told Computerworld Australia he relied on oDesk to build 1Ad.com, an online service for organisations to post job ads to multiple career websites.

Griffiths used oDesk to find help with PHP, HTML4, CSS and graphic design. He searched for and hired three contractors. The site has been under development for about six months, and Griffiths said he’s spent about $12,000 on the oDesk hires.

Griffiths said he’s mostly satisfied by the work of the contractors. With two of them, he can assign a task and “let them run with it,” he said.

However, he said he has had some trouble managing his graphic designer, who seems to have “too much work on at the moment.”

While his current contractors are from Russia and the Ukraine, Griffiths said they speak English well and he’s had no communications issues. They usually talk over Skype and email, he said.

Griffiths said he likes that oDesk contractors have been flexible to his schedule.

“A lot of my work’s done at night and by email,” he said. In addition, Griffiths said he’s been able to temporarily put the project on hold when things get too busy at his day job.

Griffiths said he plans to work with his current contractors on a continuing basis.

“I see it as building a team,” he said. “I’ve got a team of guns on call.”

Case study: Finding contract work

Charchar said oDesk helped him become a full-time freelancer doing Web design and development.

Charchar has used oDesk for about two years. The first time was to hire for a friend’s project, but six months later he decided to try the other side.

“I started out doing a couple of really cheap jobs and got some [positive] feedback on my profile,” he said. “After that people started to contact me.”

“After about two or three months on oDesk, I got enough work to leave my full-time job.”

Charchar estimated that at first, he made about one-third of what he would get doing full-time work in Australia. A year and a half later, his hourly pay is comparable what he’d make in a full-time position, he said.

When he started, Charchar applied for jobs posted on the website but as he gained feedback on the site he began getting job offers. “Over the last six months, I haven’t contacted anyone—everyone just contacts me.”

Charchar said he has not been deterred by the large amount of competition for jobs on oDesk.

“Much of the competition is not very good,” he said. “If you really put effort into applying for a job, you’ve got a good chance of getting it. And if not, you’ll get the next one.”

Charchar added that he’s built relationships with several of his clients. “It’s good to keep working with the same people, because you just get more of a feel for what they want and need.”

Follow Adam Bender on Twitter: @WatchAdam

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