The community of technology company executives is littered with stories of start-ups having serious problems with their staff or simply under the weight of unsustainable costs. “Outsourced” and “distributed” have nearly become synonymous with “uncontrolled” and “low quality.” Still, the market forces WealthTech transformation leaders to grow their business and scale teams.

Is there any shred of evidence that team augmentation is always a thief? Statistics from CB Insights say 23 percent of start-ups claim their failure stemmed from choosing the wrong team. Wrong team is a top-3 failure reason, according to CB Insights findings. It shows us that people are important contributors to the overall success of any start-up, and having a team that doesn’t fit your company can destroy everything you have built before, regardless of whether you have your people sitting in one room or distributed across the globe. Meanwhile, the tension to enlarge the workforce strengthens with each year, as we can see from a recent report. Let’s look deeper to see what causes a distributed team to negate your efforts to build your WealthTech product and accelerate the company’s growth.



You are honest with yourself when characterizing your specifications.

If you have defined specifications, then hire. If you have some specifications but feel like they could change significantly during the work, then hire, too, but just choose the time and materials engagement model. If you don’t have clarity concerning specifications, there’s little chance a fixed-price contract will help.

To help with eliciting more precise criteria on what type of distributed team you need, you can use the following guide.

You use the wrong criteria when choosing the engagement model.

Let’s assume you don’t have stable specifications but still hire a company that agreed on a fixed-price contract. Most probably, when you need to change the specifications, they will charge you extra money for every change needed.

Your hiring criterion is expertise.

In the baseline of a distributed team philosophy, there’s a belief that the expertise and engagement of an individual do not depend on where he or she lives. By hiring people from around the world, you can involve the best professionals in the project fitting your business needs and corporate values.

As research has shown, the more experienced in a business domain developers are, the less money they spend on onboarding and ramping up the team.

Your hiring criterion is low cost.

Many stakeholders think of involving a distributed workforce as a budget optimization tactic only. In some cases, this does make sense, but cost should not be the only criterion for your hiring this or that distributed team. For example, this report shows that mismatched skill sets and unclear performance expectations will most likely lead to a failed hire.

Bad hire reasons

You adjust your company’s communication model to enhance the distributed team.

To build a strong and healthy distributed team, it’s important to create an environment that encourages transparency, equality, and efficiency. For your remote team members to feel they are equal and appreciated, you need to adjust your current communication model.

Matthew Rennie, CTO at Jemstep, ensures a free flow of information and operational transparency are part of their company culture by active use of shared workspaces:

“Anyone can see the status of the stories and where they are in the workflow. From an engineering perspective, we use GitHub quite extensively. All the code conversations, peer reviews, also appear across the various locations.”

To keep all of their teams on the same page, Jemstep significantly invests in educating its engineers and maintains an extensive knowledge base in Confluence.

You insist on preserving “the good old corporate culture” and communication means.

There are companies for which corporate culture comes first. For example, if you have hired more than half of your staff via employee recommendations and people tend to stay in your company, you did a great job, really. It’s not a good idea to fix something that isn’t broken, right?

Still, there’s no reason to limit such a great team spirit to a brick-and-mortar office. The new “a laptop is a workplace” paradigm changes the way employees evaluate companies during the hiring process. So refusing to scale and adjust to the new realities narrows your opportunities to hire the best of the breed.

Your in-house and distributed workers share the same values.

Seeing eye to eye with your remote employees plays a great role in a project success. When everyone shares responsibility for the project’s success, it eliminates risks concerned with lack of control over the work progress.

Alex Sukhenko, CTO at Salsa Labs, sets an example of how he transmits his values and devotion to his team and company:

“Any SaaS company is going to have a service problem. Depending on the severity of them, I’ll jump in on the firefights, in the video calls. Sometimes, I’ve gone 24-plus hours on some of these things and stay with the guys until it’s fixed. I’ve built the credit with those guys so that I can push hard and get them to work harder and longer.”

There are cultural differences or disconnected values across the teams.

Some companies make the mistake of disregarding the importance of culture, values, and goals unity. When people working on your solution have different goals and priorities, they won’t collaborate efficiently with each other. In this article, you can find an example of why it’s important to keep all the teams aligned with the company’s vision and goals and to make sure they feel safe about the preservation of their jobs.

You are ready to manage a distributed team and have a clear understanding of how to establish the processes.

First of all, the new team organization type is about enhancing and optimizing the processes you already have. All the things you have put aside for so long should be uncovered and fixed so that your distributed team can have a future. If you struggle to determine whether your processes are mature enough to allow hiring a distributed team, look through the checklist in this guide.

You expect that managing a distributed team would be the same as an in-house team.

As you can also see in the report, only 8 percent of companies efficiently manage processes within distributed teams. When you deny the necessity to change the way you manage teams, the chances of finding yourself in this 8 percent of companies decline.


This pros and cons comparison describes only a few of the problems in processes you should count on before scaling a team in-house or hiring a vendor. In this white paper, we have gathered the most frequent mistakes your project processes should correct for you to organically augment your current development forces.

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