We are in Australia, and looking at costs for developers it looks like we can save significant money in developer costs.
We'd be looking at hiring 5 initially then. expanding the team to 20.
Does anybody have experience with this?
In Bangalore
Your cost for 2000 square feet office space would be at least $2000/mo in a fairly decent building; add to this 10 months rental advance which is $20k
Your cost for each developer would be between $1k - $2k - this of course depends on the kind of work they'd need to do as well as how much experience you're looking for in people. Do remember that almost everyone in India expects a 10 - 20% raise every year. Senior level PHP folks will cost you $1,500-ish considering the fact that freshers out of school get paid $600-ish a month.
You'd also need to invest substantially in management staff in India because it's very hard to get anything done unless you have a manager for every 4-5 people, unless you get really good self-motivated guys who'll cost you a bomb. Managers will end up costing you $2k+
And, I forgot to mention - laws and the government are a bitch here.
I think you're just a few years late in jumping to the Bangalore bandwagon :)
Cheers!
1. Register a Pvt. Ltd. to do business <-- hard to do unless you're Indian or someone who's Indian on board 2. Register with the RBI and get stamped from them every time you remit money from outside India <-- painful 3. Not be able to use a majority of payment gateways that collect payments in foreign currency if you want to directly tie it to your Indian co. 4. Process ESI if you're paying under $400/mo 5. Process PF if you're paying over $400/mo and have more than 10 employees
It's paperwork, paperwork and more paperwork!
As for being late to the party, cost of labor has gone up at least 4 times in the past 10 years and it's going to probably go up another 3 times in the next five years. Smart people are no longer that easy to find and very few folks actually are interested in working for startups. Cost of infrastructure, electricity, broadband, everything is higher in Bangalore and more at par with Austin or Boston tbh.