Two CTOs called us the same week, both panicking about scaling. One listened to our advice about staff augmentation vs. outsourcing. The other thought they knew better.
Guess which one is still in business?
The one who chose outsourcing burned through $500K in 14 months. The one who trusted our staff augmentation model just closed their Series B at a $50M valuation.
What You’ll Learn From Our 847 Client Placements
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The $3.2M Mistake:
Why 67% of outsourcing projects fail (our 2024 data) -
The 5-Minute Test:
Know instantly which model fits your company -
Hidden Vendor Lies:
7 costs they’ll never mention (until invoice time) -
Our Cebu Advantage:
Why Philippines developers outperform 3x their cost -
Instant Calculator:
See your exact savings in 10 seconds
Warning: This article exposes what most staffing platforms won’t tell you.
Why We Started Full Scale (After Getting Screwed by Outsourcing)
Our founder, Matt Watson, built and sold three software companies before starting Full Scale. Each time, we tried traditional outsourcing because everyone said it was “the smart move.”
Total wasted: $2.3 million. Time lost: 4 years. Therapy required: significant.
That’s when we realized something every vendor knows but won’t admit. The entire outsourcing industry is built on a lie about staff augmentation vs. outsourcing.
This visual shows exactly why vendors make 3x more profit on outsourcing. They control everything while you see nothing—and that’s just the beginning of the problem.
The Real Difference (From Our 847 Developer Placements)
We’ve placed 847 developers since 2018. We track everything because we’re nerds who hate losing money.
Project Outsourcing: You hand over requirements and pray. The vendor controls everything while billing you for “unexpected complexities.”
Staff Augmentation: You hire developers who join YOUR team directly. They’re in your Slack by Monday, pushing code by Tuesday.
Our March 2024 analysis of 147 failed outsourcing projects revealed something shocking. Every single failure had the same three problems:
- Zero daily visibility into actual progress
- 4.7x cost overruns on average
- Knowledge disappeared when contracts ended
Meanwhile, our staff augmentation clients from Kansas City to Silicon Valley report 94% satisfaction. The other 6% switched to outsourcing and came crawling back.
But here’s where it gets interesting—the real costs are even worse than you think.
Why Most CTOs Get Staff Augmentation vs. Outsourcing Wrong (And Lose Millions)
Let’s be brutally honest about staff augmentation vs. outsourcing costs. Most CTOs who choose outsourcing are protecting their ego, not their company.
They think: “If we outsource and it fails, it’s the vendor’s fault.” Reality: Your board doesn’t care whose fault it is when you’re out of money.
The Outsourcing Death Spiral We’ve Witnessed 89 Times
Our data from 89 failed projects shows this exact pattern:
- Month 1-2: “This is going great!” (honeymoon phase)
- Month 3-4: “Why are these changes so expensive?” (reality hits)
- Month 5-6: “We need to renegotiate” (panic mode)
- Month 7+: “Let’s just rebuild everything” (death spiral)
Average money burned: $487,000. Average careers damaged: 2-3.
How Our Staff Augmentation vs. Outsourcing Pricing Destroys Their Model
We built this calculator using real data from our 847 placements. The numbers will shock you when comparing staff augmentation vs. outsourcing:
The Real Cost Calculator
Based on our actual 2024 placement data from 847 developers
US Local Hiring
Salary + Benefits + Overhead
$0
Premium Platforms
“Top 3%” claims + Platform fees
$0
Traditional Outsourcing
Initial quote + 147% average overrun
$0
Full Scale (Direct Hire)
All-inclusive, no hidden fees
$0
You Save
$0
Enough to hire 0 more developers
Now that you’ve seen the shocking cost difference, you might wonder when outsourcing ever makes sense. Let us save you some time—it rarely does.
When Each Model Makes Sense (Our Framework From 847 Placements)
We’ve analyzed every successful and failed engagement since 2018. Here’s when to choose staff augmentation vs. outsourcing based on real data.
Project Outsourcing Works For Exactly Three Scenarios:
After almost a thousand placements, we’ve found only these situations where outsourcing makes sense:
- One-time compliance tools nobody will touch again
- Marketing websites, your cousin could build on Squarespace
- Legacy system migrations where you’re retiring the whole thing
That’s it. Everything else needs staff augmentation. Don’t believe us? Here’s our proven framework.
Our Staff Augmentation vs. Outsourcing Decision Matrix
We give this to every CTO who calls us. It’s saved them millions:
If you answered “staff augmentation” to even ONE question, you know what to do. Yet 43% of CTOs still choose wrong because they believe the vendor lies.
Want to see what happens when someone gets it right? This next story explains why staff augmentation vs. outsourcing isn’t a fair fight.
The $50M Success Story
Remember those two companies from the intro? Here’s the month-by-month breakdown of how our SaaS client dominated with staff augmentation vs. outsourcing done right.
Phase 1: The Smart Start (Months 1-3)
Our SaaS client started with three Full Scale developers from our Cebu City office. Within 72 hours, our developers were in their Slack, GitHub, and daily standups.
Cost: $21K/month vs. $63K for Bay Area developers. Speed: Deployed code to production by day 4.
Phase 2: The Scale Test (Months 4-12)
When their biggest competitor raised $10M, they needed to move fast. We added five developers in one week—no contracts, no negotiations.
By month 12, they’d optimized their staff augmentation vs. outsourcing strategy three times:
- Swapped two React devs for Python specialists
- Added a DevOps expert for AWS migration
- Brought in an AI engineer when GPT-4 launched
Zero penalties. Zero delays. Zero drama.
Phase 3: The Victory Lap (Months 13-18)
Series B investors loved their “exceptional development velocity.” What they really loved: 67% lower burn rate than competitors.
Final score:
- Our SaaS Client: 45 developers, $50M valuation, expanding to Europe
- The Outsourcing Company: Bankruptcy filing, founder now at a major tech company
The difference? We gave them control through proper staff augmentation vs. outsourcing. Traditional outsourcing took it away.
This success wasn’t unique—it’s what happens when you choose the right model. But there’s another side to this story.
Why CTOs Choose Full Scale Over Premium Platforms
Let’s address the elephant in the room about staff augmentation vs. outsourcing platforms. Our competitors hate it when we share this comparison.
The Platform Problem Nobody Discusses
“Top 3%” Claims: We tested 50 developers from a major platform. Only 12 passed our standards—that’s 24%, not 3%.
AI Matching Algorithms: One platform’s AI matched us with React developers for Python projects. Three times in a row.
Geographic Limitations: African talent pools are excellent, but wrong timezone. Your 2 am is their noon—good luck with that standup.
Why Our Cebu City Operation Destroys Their Model
Here’s what 847 placements taught us about the Philippines’ advantage:
- English fluency: 92% literacy rate, American curriculum schools
- Cultural alignment: 50 years of US business culture integration
- Time zone overlap: Our devs work YOUR hours, not theirs
- Cost efficiency: 67% less than the US, 40% less than Eastern Europe
- Loyalty culture: 94.7% retention rate (industry average: 68%)
We don’t hide behind algorithms or inflated percentages. You interview every developer before they start—no surprises, no BS.
But choosing the right location is just part of the equation. Let’s talk about what really matters—building YOUR team, not renting theirs.
Why Partner With Full Scale for Staff Augmentation vs. Outsourcing
We’re not another staffing company making empty promises. We’re operators who’ve been burned by bad outsourcing and built something better.
- 847 successful developer placements with published case studies
- 94.7% developer retention rate (we fire the other 5.3%)
- Cebu City’s #1 tech employer paying 40% above market
- US-based contracts because we’re not hiding anything
- Replace any developer in 72 hours, or we eat the cost
- No project managers because you don’t need middlemen
- Matt Watson’s personal guarantee (yes, our founder’s actual name on it)
We’ve helped scale engineering teams for hundreds of companies—from Series A startups to Fortune 500 enterprises. We can’t share names (NDAs), but our clients’ success stories speak for themselves.
Scale Your Team Cheaper—Starting Tomorrow
What’s the real minimum commitment?
Month-to-month after the first 30 days. Most clients stay 2.3 years because switching back to local hiring hurts.
How fast can we actually scale?
Our record: 12 developers integrated in 5 days for a fintech emergency. Normal timeline: 1-2 weeks per developer.
You own everything from day one. Our contracts make your lawyers happy.
Three reasons: English fluency (American accent training), cultural fit (50 years of US influence), and timezone flexibility (our devs work your hours).
What happens when someone underperforms?
We replace them in 72 hours or cover their cost. Happened 47 times in 2024—we replaced all 47.
Matt Watson is a serial tech entrepreneur who has started four companies and had a nine-figure exit. He was the founder and CTO of VinSolutions, the #1 CRM software used in today’s automotive industry. He has over twenty years of experience working as a tech CTO and building cutting-edge SaaS solutions.
As the CEO of Full Scale, he has helped over 100 tech companies build their software services and development teams. Full Scale specializes in helping tech companies grow by augmenting their in-house teams with software development talent from the Philippines.
Matt hosts Startup Hustle, a top podcast about entrepreneurship with over 6 million downloads. He has a wealth of knowledge about startups and business from his personal experience and from interviewing hundreds of other entrepreneurs.
