It isn’t very easy for anyone outside the software industry to differentiate software-outsourcing companies from product-development companies. They are, after all, employers mainly for programmers, with clients across the globe competing fiercely in Bulgaria for relatively scarce engineering talent and other motivated, mostly young, people. Every founder of a product company usually talks about the core of their teams as creators of something new. The “developer” position has a literal meaning to them from a market point of view.
Why is this distinction important, after all? The software industry in Bulgaria is changing. Cheap people are no longer a competitive advantage, especially when it comes to fast-learning coders. The long-term competitive advantage of the country may be the loyal engineers developing the companies, the flexibility to work remotely in multinational teams scattered around the world. This ecosystem change will take several years, but it has already begun. Product software companies feel more comfortable in Bulgaria, and yes, their teams are traditionally more compact than mass outsourcing. Still, we rarely hear from them that there is no good talent pool in Bulgaria.
In this rubric, Trakia Tech presents such examples, and we feel optimistic that this will change the face of Bulgaria faster than otherwise spontaneous restructuring. Another positive example comes from the American company SwimCloud, which for five years, has been developing its product with a team from Bulgaria. This is a platform for collecting and analyzing swimmers’ data, as well as connecting them with interested college coaches. Analyzing swimming performance data of tens of thousands of competitors is useful for both swimmers and their parents when choosing a university, as well as university coaches who try to attract the best swimming talents to their team each year.
That model is not particularly well known in Europe. But for the US, college swimming is a significant generator of Olympic and other athletes internationally. 76% of the swimmers in the US national team at the Rio Olympics in 2016 went through the college system. Each year, there are about 9,000 new swimmers who choose a university to compete in (and to study in). Over 90% of them are SwimCloud users.
Founders Ivan Manolov and Greg Earhart decided to create a team of platform developers about five years ago with the clear notion that such an organization could not be sustained in San Francisco. This is especially important for a company that is not looking for VC or debt financing. The so-called “bootstrapping” of a company may be the most valuable advisor in deciding where and how to spend the scarce product development resources. To this day, the company is 100% owned by the two founders, financing its organic growth by reinvesting profits.
The prospects for this startup are promising. The company is self-sustaining, attracting, and training developers who like to participate in the creation of a global product. The two co-founders are first and foremost fans of swimming – and Greg is the executive director of the College Swimming and Diving Coaches Association of America (CSCAA) – and this passion cannot be missed in the performance of the product. All this motivates, attracts, retains young programmers – a loyalty that is a problem for many other players in the industry. This is also the future of this segment of the labor market. People’s scarcity is not a problem in the labor market, but the way people are motivated and developed by employers – something that will be easier with high productivity, which can only be achieved by the development units of global product companies.