Definitely Use Escrow for Outsourced Projects

I used to get a lot of little projects done for me on – things like header design and other little graphics projects.

However, recently I thought I’d start using some people from a popular forum I participate in.

Only problem is, most times they require the money up front before they start work. I can see the sense in that, from their perspective. For that matter, I do the same when I’m charging out my services. (well, 50%).

Unfortunately, on about 3 separate projects that I’ve now used that system (paypal, pay up front) I’ve yet to receive a satisfactory result. I get an initial burst of activity and some sort of deliverable, which inevitable requires modification.

Then the modification process starts to drag out; communications become slower and slower with more days in between responses.

Admittedly, part of the problem is on my end as well, as I should be prompt in my communication and stay on their case.

So what’s the lesson to be learned here?

Use some form of escrow whenever you’re dealing with someone online and the deliverable will come at a different time than the payment. Places like work well, I’m told.

The benefit is that the person you’re hiring knows they’re guaranteed their money, if they deliver. You know that you’re guaranteed delivery, or you don’t pay. Win-win.

3 Responses to Definitely Use Escrow for Outsourced Projects
  1. Mechants Center
    August 7, 2009 | 12:24 am

    Or you could always use some monitoring tools that the internet have. The guys from Odesk have a really great monitoring tool. Or

  2. Red Reynolds
    February 15, 2010 | 5:50 pm

    I agree the comment above about oDesk. I haven’t been thrilled with their system interface, but it sure gets the job done. I run about $2k worth of business through there a month right now.

  3. Alok
    April 5, 2010 | 2:21 pm

    You can also try For fixed price projects, odesk doesn’t provide payment guarantee but on RAC a project only starts once the payment is escrowed and if the coder doesn’t deliver stuff on time, you can ask for arbitration. Also we have found the RAC system to be one of the easiest out there.

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