Financing a Software Startup

I prefer to think of it as having already achieved 80% of version 1.2. (If you are happy with the first shipping version of software, you waited too long. Cut the scope, get something in the hands of paying customers, and start getting feedback. And money. But mostly feedback.)

Plus, if you do it inhouse, that 80% might actually work. (If I sound grumpy about outsourcing it is only because it is code review day at the day job...)

From experience, outsourcing is good for work that don't require innovation (populating content etc). If you're startup though, you're pretty much unknown problem looking for unknown solution and that's when u want to keep the team close together and everyone cares about "doing the hard thinking".