Surprisingly, they source them here by visiting the States and finding people the same way Zynga & Google would. I was recently recruited for a project for a startup in Shanghai recently -- the most complicated part is the compensation part as most USA based services don't accept payments from China, including Google Wallet.

And no, mandarin isn't a requirement. I'm not really teaching english like those stories from japanese blogs -- I'll be coding in coffeescript for my wages.