The paper reports on a survey of personnel from outsource and client companies concerning the factors that are critical for a small-to-medium-sized company in the outsourcing business. Usable responses were received from 201 individuals: 68 from US outsourcers, 59 from non-US outsourcers, and 74 from client organizations. 31 potentially critical success factors, drawn from a literature review, were considered. Six key critical factors were identified. Two of these factors, technical skills and general knowledge skills of the outsource workers, can be directly controlled by the startup outsourcer. Two others, a knowledgeable client contact and trust, are mutually controlled by the vendor and client. The last two critical factors, intellectual property right protection and telecommunications infrastructure, tend to be controlled by the governments of the vendor (and to a lesser degree the client). The article points out that "traditional offshore development is primarily application development. These applications tend to be highly structured requiring little or no changes to the requirements specifications. These projects require less interaction and project management from the client. They are ideal for outsourcing as deliverables and bids are understandable and predictable and risks are better understood. Current offshore development includes e-business and Web application development, and "follow-the-sun" or "round-the-clock" application development. These projects tend to be less structured in nature and need more client contact and project management than traditional offshore development projects. They are less ideal for outsourcing as deliverables, costs, and risks are less predictable." There is a useful literature review in this paper.