Menlo Park, Calif.-based oDesk Corp., a startup working to make software outsourcing easier, attracted Benchmark Capital to its $8 million Series B financing, according to a regulatory filing.
The startup acts as a marketplace for other software companies looking to hire computer programers to develop their products. oDesk connects the companies with competent software engineers, which may be remotely monitored via webcam and paid for the work they complete. The company could help individual programmers get work and allows companies to pay the programmers by the hour instead of by the project, making it easier to split large projects across multiple workers.
The company raised $2 million in the first tranche of its Series A round in 2004 and closed $4 million for its second tranche in March 2005 from Globespan Capital Partners and Sigma Partners 6.
Kevin Harvey is representing Benchmark on the investment. He was referred to the deal by one of oDesk’s board members and subsiquently found that two of his portfolio companies were already using the startup’s service. Benchmark is interested in markets that improve efficiency, Harvey says. He compares his investment to Ingenio, another Benchmark investment that that allows experts to sell their advice via telephone to anyone interested in what they do.
Harvey says most of Benchmark’s portfolio companies are offshoring some aspect of their product development to take advantage of disparities in the world labor market. “Why pay someone $60-$70 here for PHP work when someone in India or Russia will do it for $15?” he says. —Alexander Haislip