Full Throttle Leaders Podcast -Developers Net (Emilio Baez and Doug Loyo)

Hello everybody. Michael Falato's Full Throttle Leaders Podcast today. Guess what? 2 guys I love. These guys are clients of mine also as well on my lead gen side, and I wanna highlight their journey. We've got Emilio and Doug from developers.net.

Hi.

Doug and Emilio, but Doug, start.

What—

how did you guys start this company? What does it do?

Yeah, thanks for having us, Michael. Thanks everybody for being here. Um, yeah, I mean, back in the day, like around 2016, early 2016, Emilio and I met. Our paths crossed, um, in an edtech project that he was maintaining, and, and the company that I was working at wanted to acquire. During the due diligence process, we were paired up to review code and to do some of the technical artifact checkboxes. We hit it off really well. I heard a little bit of an accent in Emilio's voice and I was like, oh, come on, man, I know you speak Spanish. I'm half Texan, half Mexican. We started speaking a little bit in Spanish and we hit it off really well, man, honestly. As you can see actually right now in Emilio behind him, he has that poster that says, keep calm, I'm a DBA. More than a DBA, he's a full-stack software engineer architect. But man, he always knocked my socks off with all the DBA, database administration, database architecture knowledge that he has. Um, yeah, I guess, I guess that's when, when we met. Emilio, anything you want to add?

Yeah, I mean, thanks, Doug. I mean, the, um, like Douglas said, like, we, we hit it off really good. I think one of the things that impressed me was the, the ability that Douglas had to move from like the front end to the back end. And I remember like one night we were working with, with a couple of our first developers and I told them, man, we need an expert in Angular here so that they can teach these guys really, really advanced Angular stuff because we have a client that is pretty, pretty stringent, right, on how they vet the developers. And Douglas told me, no, man, I got this. You want to know Angular? Let me show you, right? So, from the beginning, we realized that our skills were so complementary that, well, we decided to do something together. So, we were like, Man, there's nothing we cannot do together. I got the backend, the database, you got the frontend, you got the middle tier.

Mm-hmm.

And that's how the whole thing came about. The idea was not to create developers.net. The idea was to create a SaaS product that we can sell. But as part of that, as part of the process of creating that product, we try to hire people from Latin America without any success. We hire I remember around that time we hired like 4 or 5 recruitment companies from Austin, and in a whole month they couldn't find— they couldn't send us a profile that was really, really solid. So as entrepreneurs, Douglas and I looked at each other and we were like, screw that SaaS idea. Let's actually do a staffing firm. It would take staffing firm with quality. This is what this country needs. If we're in Austin, which is a big tech hub, and none of the recruitment firms based in Austin can send this quality, that means this country needs that. So that's, that's why Developers.NET came about, or Near Sure Death, which is how it was called at the very beginning.

How long ago did it start? How long ago did Developers.NET start?

2017 was when we actually created the company. I think it was like late 2017, but we started conversations early on, right? Like what Emilio mentioned, like we listened to the market. We were trying to build this software, this SaaS product, and then it was like, man, nobody can supply us Latin American developers that are good, right? Kind of felt like resume flippers. Like everybody would look for keywords on the resumes and just send them to us. And we were like, this is not what we need. We need high-quality, elite senior software developers to come and help us.

How do you find them better than these other companies that do this?

Well, it's definitely a— we're still in a volume game, right? We have a funnel that we designed, our own process where people apply at the top of the funnel or we find them. We have different experiments that we run Uh, to find people, right? Everything from job boards in Latin America to like, um, relationships with universities, um, down there. Um, headhunting— we still do headhunting through many of the portals that are out there, right? Um, and other experiments that are preparatory that we can't talk about here of how we find people. But it's not only finding them, right? Then we pass them through, uh, the stages of our, of our process. We have a process that we define that is called the LIKE process, and it's an acronym for language, interaction, knowledge, and execution. So it's not only finding them, it's how we filter them down and how at the end of the funnel we just select one or two that are really top-notch.

And do you also— is it temp? Temp to hire, full-time, is it contingency, a retainer? Tell us about the overall placement side of things and overall how do you guys get paid?

Yeah, we don't, we don't do temp to hire. I think, um, a lot of, a lot of our clients in the past have asked us this and it's not part of our model. I think the difference between companies in the US that do temp to hire and us is that When you hire somebody in the US through a US staffing firm, normally they don't get benefits, they don't get any of that, and they get paid less because the staffing firm has to make their money, right? So in the US, most of these individuals are looking forward to move on and work directly with these companies. In Latin America, it's completely different. First, we pay them really, really, really well. Second, they— companies in the US, our clients wouldn't know how to handle their benefits down there in Latin America. Right. And we pay them health insurance, we pay them Christmas bonuses, holidays. We have a plethora of benefits that we offer that our clients wouldn't be able to do that. So our— and a lot of these developers are making great money in Mexico and Latin America. They live really well. They're not looking forward to migrating to a new country to learn a new language. So it's something that the developers don't want to do.

I noticed when I was trying to hire people from Mexico, there was housing credits, discredits, how you— it was a big— it was like, wow, there's a lot of intricacy in Mexico about how they get paid. Is it because they get help a lot from the government? But if you pay them a different, different way, they don't.

Yeah, it is, uh, it's very interesting. And the labor law compliance is also very difficult, and not only in Mexico, right? We work with 9 countries including Brazil, Argentina, Colombia, like other countries in Latin America. So that is also sometimes scary for US-based companies, right? It's like, how am I going to deal with compliance, like international compliance? How am I going to deal with What if I get sued from a talent, a person that I hired in, in Brazil or in Mexico? Like, what, what happens, right? What happens there? Um, so throughout our years of experience, we, we have a system, we have a network of lawyers, of people who help us, uh, do all this. And, and there is some interesting labor laws, I'll tell you that, Michael. There's, um, in some countries in Latin America, it is still expected That by end of year you have to do a Christmas bonus, right? Interesting, interesting, right? Uh, we worked in Austin, Texas for a long time, and Texas is a right-to-hire, right-to-fire state. So you can't just let go Latin Americans that you hire as a full-time employee. There's a process, right? Um, and if you don't follow the process—

As someone in another country, they had— you had to abide by Texas law?

No, no, no, you can't. You have to abide by the local law of where you're hiring them.

Okay.

You have to. Um, so it's really interesting, all these little nitty-picky things, right, of, of, um, some of the value that we add to, uh, to our clients.

Are you the employer of record, the EOR?

See, depending on the country, it is very interesting how that changes, but in some countries we are, in some we're not.

Mm-hmm.

Um, and some of this, some of these benefits, Michael, is something that we don't— that our clients don't even know about. Like, it's transparent to them, right? Like, this is something that, that if they knew about this, they wouldn't even dare to hire directly from Latin America. For example, that Christmas bonus, at the very minimum, it has to be half of their salary for a whole month.

Wow.

So when you, when you have 20 developers, it's not an issue. When you have 200 billable people like we do right now, It's, it's in the $100,000, $300,000 extra that you have to come up with in December just to, just to give them that benefit. And we don't charge our clients for that.

Yeah, that's an unforeseeable cost that could actually get really hairy.

Yeah.

So is there a particular ideal customer profile that you like to work with, and is there a particular ideal engineer country that is easier to work with?

From a client perspective, we've kind of narrowed it down a little bit of like what really is a good fit with us and what is not. So somebody who's like brand new, who has no software development experience, doesn't know how to build software, doesn't know what to expect. We call them like Joe that has $1 million and comes and says, hey, I have an idea, build this software for me. Not a good fit for us, right? We want to work with companies that do have that maturity, the understanding of what software development is, what to expect, what it is, right? So usually it's going to be companies that at least have like $10 to $20 million ARR. And we work with really, really large companies also, right? Like big enterprises Um, like Dell Technologies, like LG Electronics, like, um, some other, some other bigger ones, more interesting ones, right? So, um, smallest client that we have I think is a, like, a one-man show, but they do know, uh, they really, really know what they're doing building software, and, and they understand, and they have only one developer. And our biggest client probably has a couple of teams and more than, more than 20, 25 developers working in there. So I guess we only have a limit on the, on the bottom limit and not on the, on the higher limit.

Is there an average revenue per client that you shoot for?

Um, not, not really, no. This is again why we have clients that have only 1 developer and clients that have 25, right? Like, we don't We don't really mind as long as they are a good fit with us and they're not a headache, right?

Is there a particular go-to-market strategy that's working really well for you?

There's multiple things that we've tried out in the past that have been difficult, right? We did a lot of investment back in the day of like other people that promised lead generation and promised appointments and promised all this. And could not deliver. What do you think, Emilio? What are other failures in the past?

I mean, having like dedicated cold callers in the team for a whole year without delivering. Yeah, a lot of companies that say that they can do lead generation for us and they have failed. I think traditional marketing just doesn't work for us, like SEO. We don't have a pair of shoes to sell, right? It's not a product like Nike that You know, you can just advertise. Do the math. We realized that our best way of selling is going out there, going to conferences, meet people in person and create that trust, create that in-person relationship. And aside from Doug and I, we're scaling that out and we have another team that is doing that with us right now. As far as go-to-market, I think what we're doing with you, Michael, is working pretty well. Um, those roundtables and, and some of the, some of the podcasts that we're doing, it's definitely something that we, that we're excited about. Um, aside from that, I, I don't think we can pinpoint a single experiment that have worked in the past.

Okay, so how do people get a hold of you, and who's your best client to get a hold of you to use developers.net? So give me your contact information, and then What types of people reach out to you? Are they CEOs, founders, VP of software engineering, CTOs, CIOs?

Yeah, I think depending on the company size, um, as I like to say, the CEO of a company like 3M is not going to be interested in taking my call. Um, he— him and I have probably nothing to talk about, right?

Well, you could interview him for one of your podcasts.

That we could do. That we could do for sure. But trying to sell them on, um, nearshore staff augmentation or products or AI-augmented engineers. Uh, that's— I don't think that's in his wheelhouse. He has bigger, bigger fish to fry, right? So depending on the size of the company— smaller companies, yes. Um, people like the, the CTO, the CEO, the CIO, um, of smaller companies, those are great, uh, contacts for us. Um, a little bit larger companies like directors of development or senior managers or VPs of engineering, directors of engineering. Those kind of roles work really, really, really well with us.

And what's your email, Doug?

My email is very easy. It is doug@developers.net.

Emilio?

Same thing, emilio@developers.net.

Well, I appreciate your guys' time. Um, you guys are doing awesome work and I love working with you guys. And please, audience, reach out to these guys. It's a great service. There's a lot of people that do staffing, a lot of people don't know what they're doing, a lot of people that look for keywords on a resume. I come from the recruitment space. There's a lot of fallacies what people are doing. These guys know what they're doing. So thanks for your time.

Thank you, Michael.

Thank you, Michael.