Why is Belarus a great IТ outsourcing destination?

The IT outsourcing (ITO) industry is quickly developing. Aiming to hire skilled specialists, access field-specific expertise, drive innovation, and relieve in-house employees’ time for other tasks, businesses are delegating software projects to outside IT service vendors.

In 2018, the global IT-application outsourcing services market reached $89 billion and it’s expected to increase to $96.7 billion by 2021. No wonder, Internationally-renowned brands like Samsung, Peugeot, Mitsubishi, Coca-Cola, Reuters, Procter & Gamble, and the World Bank are cooperating with third-party contractors for years.

There are many ITO destinations, among which Eastern Europe is gaining high popularity. In accordance with the different reports, the ITO market in Belarus, Poland and Ukraine is growing 4-5 times faster than worldwide. The main customers in this region are the USA and Western Europe. Belarus stands out among the pull of IT outsourcing destinations.

To find out why so many companies decide to cooperate with Belarus, we conducted an interview with Andrew Volchek, CEO at Arateg. The company is an award-winning outsourcing vendor for custom software development. Arateg helps startups and SMEs maximize the value of their products, work smarter and grow, providing expert software engineering, design and consultancy services.

Clutch, the world’s leading client review and rating platform, featured Arateg as one of the highest-rated B2B firms in Belarus. GoodFirms, another trusted service, named it one of the best custom software development companies. The firm was also included on similar lists on AppFutura, The Manifest, IT Firms, and WADLINE. Learn more about Arateg.

Interview with Andrew Volchek, CEO and Co-Founder at Arateg

1. What is your company’s mission?

The idea behind the foundation of Arateg was to make people's lives more comfortable and work of organizations more efficient with the help of modern technologies. To be more specific, we consult our customers and help them address business challenges with tailor-made software solutions.

Forming the team with relevant skills and following Agile methodologies, we quickly deliver reliable and scalable digital products. The best part is that our customers are able to see the project progress in real-time with the full access to specialists, reports, and our internal information system.

2. What makes Belarus an attractive IT outsourcing destination?

A range of factors. First, great education of Belarusian IT specialists.

Second, mentality. Sharing European culture and views on doing business, we aim to establish trusted partnerships and make communication totally transparent. Business partners here are honest, responsible, and work hard to deliver the best result possible in compliance with the terms of the signed contracts.

Third, Belarus offers competitive prices. While engineers’ hourly rates in the USA vary between 70$-150$, in our country they work at a 25-50$ rate per hour. As a result, customers can reduce costs by 30–60%.

Fourthly, a convenient location. Belarus is situated in the centre of Europe, so there is just a 1-3 hour time difference with Europe and 2-3 hours flight away from European capitals. Another point is that there is a 30-day visa-free entry for citizens of 74 countries.

Then, the IT industry in Belarus is strongly supported by the High-Tech Park, an analogue of the Silicon Valley. In 2018, the exports by HTP residents exceeded $1 billion.

Finally, extensive experience. If before the key reason for outsourcing was to cut costs, now clients are mainly looking for skilled specialists who will help them achieve business goals and drive innovation.

It is noteworthy that plenty of world-famous products were created in Belarus: MAPS.ME, MSQRD, Flo, Juno, Viber, World of Tanks, and many others. No wonder, that today nearly half of the leading Belarusian IT companies are based on foreign investment capital.

3. How does your company differ from other IT outsourcing contractors?

Our approach is based on three pillars: Agile, Security and Transparency. These are not just words for us. Many companies say that they are Agile but their developers and managers don't even have a clear idea of what it is.

Our experts really understand the importance of meeting deadlines and how Agile helps with that. We hold everyday meetings, assemble a team with the required skill set for each project, deliver new functionality every 2-4 weeks, and listen to the customer's feedback. We have a strong Agile culture, I must say.

We also take care of software and data security following the best practices such as user authentication, server credentials' privacy, etc. To ensure the customer's data safety, we use security management in our office and IT infrastructure, where we use VPNs for all the interactions with client's and our own infrastructure.

In order to provide workflow transparency, our company employs an internal information system, called AraIS. It includes a personal account for our clients where they can view regular reports, see the project roadmap, and monitor progress. This allows our customers to have full control over the project.

4. What companies outsource to Belarus? What types of clients rely on you in solving their technical challenges?

It's tough to describe a general client persona. IT firms in Belarus have wide technology and solution expertise. So, you will definitely find your reliable partner.

Many Belarusian IT service vendors successfully work with Fortune 500 companies that include Cisco, Siemens, Bank of America, Coca-Cola, Colgate-Palmolive, Procter & Gamble, etc.

At Arateg, we focus on delivering web, mobile, and DevOps solutions to startups and SMEs. Most of our clients now are from the United States and Europe (the United Kingdom, Ireland, Germany, the Netherlands, Switzerland), and we are ready to open new destinations.

5. Does the distance affect communication with customers?

As I’ve already mentioned, Belarus is located in the center of Europe and there is just a 1-3 hour time difference with Europe, so it’s convenient to work with clients from the United States and Europe.

At Arateg, we follow workflow transparency: daily and weekly reports, constant video meetings, and regular demos.

Moreover, we employ Jira and internal information system AraIS, which enables our customers to have access to the reports from the team, see arising issues, track the product progress, and check task statuses at any time.

6. Does the government support the IT industry?

Yes, this is one of the main reasons why the IT sector is so quickly growing year-by-year. High-Tech Park, recognized by the Wall Street Journal as a Silicon Valley of Belarus, has created special business and taxation conditions for IT companies in the country.

Representing one of the leading innovative clusters in Europe, HTP fosters hi-end software development. Arateg is the HTP resident.

Besides, Belarus was the first country worldwide that legalized ICO, blockchain, and digital currencies. Signed in 2017, the revolutionary “On the Development of a Digital Economy” decree allowed everyone to carry out operations with tokens and cryptocurrencies.

7. How can you characterize IT education in the country?

Belarus is a country that provides a pool of cross-functional IT talents with most of them having at least one university degree. Every month specialists attend field-specific IT meetups for sharing experience, hackathons for competing in the creation of innovative products, and conferences for learning from known foreign speakers.

As the ITO sector is rapidly growing, educational institutions open new IT specializations and teach people to meet increasing demand.

On top of that, the government is planning to establish the first IT university in Belarus. The key goal is to graduate high-level professionals with the help of grants and scholarships.

Then, software development companies pay a lot of attention to in-house education, including team building activities where teams discuss tech topics and project results. Many of them pay for courses passed by their employees, participation in various IT events, and other things for acquiring new skills.

Arateg, as well as lots of other IT service vendors, invests in language training, workshops, and in-house education to ensure specialists’ proficiency. We provide free access to a variety of courses on new programming tools and languages for our team members.

What’s more, the country offers education for kids to get them interested in science and information technologies. There are many STEM (science, technology, engineering, mathematics) classes on the base of schools where children learn to write programs, design robots, develop websites and applications. Supported by the High-Tech Park and IT companies-residents, they are opened even in the smallest Belarusian cities.

8. What software development trends can you emphasize? What industries turn to you?

As our practice shows, organizations from all over the globe are increasingly outsourcing blockchain, IoT and AI projects to third-party contractors. I expect that the demand for mobile and web solutions based on these solutions will rise in the next few years.

In general, programming languages, frameworks, and other tools are tailored individually for each project considering business-specific needs. We mainly employ TypeScript and React for front-end development and Python for the backend. Python is especially loved by startups as it allows engineers to faster make innovative applications associated with data science, cloud computing, machine learning, and cut costs.

Information technology, e-commerce, food delivery, logistics, insurtech, and fintech are the major industries that are approaching us at the moment. Since people stay at home due to the COVID-19 pandemic, organizations will be increasingly delegating the creation of remote health, e-learning, delivery, online sports and entertainment solutions.

For example, three customers have turned to us lately: a company to launch a social assistance and communication portal, a European firm to build a food delivery application, and an American startup to make a mobile fitness app for home workouts.