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Starting up with offshore help

Does starting up a software firm with offshore help leave U.S. techies behind?

Not according to Persistent Systems, a fast-growing Indian company that assists software companies in developing their products.

Among Persistent's target customers are start-ups that may farm out tasks such as research and design, quality assurance and documentation. A typical software start-up may begin with 20-30 of its own in-house engineers in the United States and 5 or 6 Persistent engineers working out of India, Ravi Krishnamurthy, president of Persistent's U.S. subsidiary, said in an interview Thursday. As the customer and Persistent grow more comfortable with each other over the course of a year or so, the Indian head-count may jump to 30 or 40 engineers.

But that doesn't mean the U.S. software developers lose their jobs, said Kerman Kasad, Persistent's head of corporate communication. "Typically, the same workers migrate to higher-level jobs," Kasad said. Examples of higher-level work might include product management and design.

How and where start-ups hire is a question of some importance these days. Venture capital funds have been swelling over the past year or so, suggesting start-ups will have cash to bring on new workers. The U.S. tech industry's employment may have bottomed out last year, but tens of thousands of U.S. tech professionals remained out-of-work.

Those techies now may be competing against lower-paid counterparts in India when it comes to new software jobs. Krishnamurthy, of course, has a clear stake in this debate. His company is growing quickly--it added 937 employees in the past year to a total of 1,700. But Krishnamurthy claims the U.S. won't lose its software expertise, given the importance of understanding and selling to the local market. "It is not 100 percent taken out," he said. "It cannot be. It can never be."