I own an outsourcing company with a team of 10 in the Philippines. I started in August 2008 out of necessity when the company I was working for needed more work done than we could handle with the few employees we had. Since the company was based in Malibu, CA, it was difficult to find qualified employees who were either nearby or willing to commute for the salary they were offering.

I had been working with a web designer/developer in Cebu for over a year at that point, so I mentioned that to my boss. After a few small paid projects, they were impressed enough to sign a contract for ongoing projects. I asked my guy in Cebu if he knew any more developers, and he found 3 more. I formed an LLC and with one customer, we were in business.

2 months later, I got an email from a former classmate of my boss who heard about our service, and he needed a website updated, and the original web design company was too busy to get it done right away. In the course of doing that project, we had to contact them to get the server login info, and when we told them what our company did, they hired us to do web design for them.

It's been like that for the last few years, just getting more clients through word of mouth. We now have 8 clients, mostly web design companies who outsource projects to us, or clients they refer to us for content creation, data mining, etc. The team is up to 10 now. We still have that first client, though.

EDIT: Forgot to mention that in all this time, we never got around to building our own website or placing ads. We really don't need to since we get as much work as we can handle through word-of-mouth, and it will be difficult to scale while maintaining high quality.