Let’s say you have a great idea for a new app, one that requires custom software development.

And, for the sake of argument, let’s say you’ve completed your market research, studied your competition, and you’ve decided to move forward with the software development phase.

Now what?

Let’s consider the major decisions facing a company looking to build a custom application, what their options are, and how to get started.

Your First Decision When Building an App

The first decision you need to make sounds simple but will have a profound effect on everything that comes after: who is going to do all that work?

Each business basically has two options:

  1. Build it in-house
  2. Contract with a custom software development partner

Building Software Applications In-House

To execute a custom software development project in-house, you’ll need to possess all the necessary software expertise within your company. This may include a UX designer, software architect, front-end and back-end developers, and a quality assurance engineer. Maybe you’re a full-stack developer on a mission, but most likely, you’ll need help.

Your options for building apps in-house depend on the size and scale of your company, what you hope to accomplish, and the resources available to you, both in terms of funding and in available talent. These options include:

  • A technical co-founder
  • An internal development team

Technical Co-founder

A technical co-founder can be useful when the initial job is small enough that one person can build it – at least the first version of it, anyway. In this case, you recruit a senior or executive level person with the right software expertise, offer them some kind of equity in your company, and set them loose on your project.

Startups and small companies without existing tech components are most likely to follow the technical co-founder route. This reduces their upfront expense while at the same time ensuring focus and commitment to the project.

The main disadvantage of looking for a technical co-founder is that you’re never quite sure what you’re getting. And that’s a huge risk because, in this model, the new co-founder is also your single point of failure. Choose well, and your fortunes could be made. Choose poorly, and you could be out of business or starting from scratch. Plus, there’s the issue of “technical debt.” One person working feverishly alone is going to cut some corners here and there. Those missing corners sometimes cause problems down the road as you try to evolve or expand your app.

Internal Development Team

A development team, on the other hand, eliminates the single point of failure. You can speed up your progress while adding more discipline to the process. A major disadvantage is that, with the current shortage of software engineers, it’s harder to put together a skilled team (especially a local one) than it is to find one person. It’s also much more expensive both upfront and in the long run. Plus, you’ll need to expend resources to manage the team as well.

Outsourcing Software Development

Contracting with a custom software development partner, rather than building it in-house, is the preferred solution for many companies regardless of their size. Contractors can be hired for very specific skills without long-term commitments. They’re more expensive per hour, but when you consider your time to recruit, hire, onboard, and train, a contractor rate is very competitive. Add to that the high cost of benefits and payroll taxes, and your numbers are on par.

The following outsourcing scenarios can be used to build your app:

  • Freelancer
  • On-shore development team
  • Off-shore development team
  • Hybrid team


As with the technical co-founder option, the freelancer solution is hiring one person to do the job. Except you’re paying them for their billable hours rather than with equity or a role in your company. It’s more flexible because you can modify the amount and pace of the work, although you’ll need to manage the process closely.

On-shore Development Team

An on-shore development team is a company specializing in software development that can interact with you directly. They bring all the necessary roles and expertise, manage their own projects, and can get going quickly.

Off-shore Development Team

An off-shore development team is similar, but the project teams are located in different countries. This is a cheaper option than a strictly on-shore one but introduces challenges in communication, timing, and sometimes quality. There are often hidden costs and cultural barriers, leading to additional management overhead. Due to the shortage of affordable on-shore engineers, many companies we talk with have gone this route, only to be disappointed with the results. Why? You can’t throw requirements over the fence to a group of engineers halfway around the world and expect them to execute perfectly. A well-run software project relies heavily on a disciplined process.

Hybrid Development Team

An outsourced custom software development partner that uses a hybrid development team is a great solution to get the best of both worlds. They use on-shore project management and senior technical talent to interact directly with your company. You can sit at the table with the strategic members of your team for whiteboarding sessions and deep conversations about your vision. The team is rounded out with off-shore technical resources to provide a more cost-effective solution. Since they closely manage the process, they shield you from the cultural and timing barriers. A hybrid company can therefore pick the best available resources, no matter where they are in the world.

The Two Best Options for Building Your App

So now that I’ve shared with you some thoughts on who could build your app, you’d probably like some advice on how to choose. Here are my recommendations:

1. Technical Co-founder
If you can find this “match made in heaven” and bring a qualified, executive-level teammate on board – that’s also capable of doing the work – this is a great option for a startup, at least for the initial stages of your app. A technical co-founder is completely dedicated to your efforts and can be a valuable asset when it comes time to secure financing.

2. Hybrid Company
If you need a full development team that can come in, view your requirements, and get started right away, I recommend a hybrid custom software development company. This is the model used by Ascendle for most of our engagements, and it is the best, most efficient solution I’ve found for developing software in my 30+ years in the industry. Learn more by watching our free webinar about When Outsourced Software Development Makes Sense.

How to Tell When a Developer is the Right Fit

No matter who’s building your app, there are several factors that impact your success. Whether it’s a single person or a structured team, make sure that you check off what I call the five “credibility indicators:”

  1. Shippable software will be demonstrated on a regular basis – every 2 weeks is ideal.
  2. You have the ability to influence and change priorities throughout the project.
  3. Testing is done all the time, not just at the end.
  4. Automated testing techniques and tools are used.
  5. A formalized support plan is present for post-launch releases.

Aside from these, you’ll need to be able to work closely with your developer, so open and easy communication will always be a key. For a more detailed look at choosing the right developer, check out this video from our VP of Operations, The Two Most Important Questions to Ask Any Potential Software Partner.

Discover More Free Advice in our Webinar

So this gives you a lot to think about if you’ve just come up with an app idea and want to get started. I’ve given you my recommendation as well as my credibility indicators for finding a good developer. Plus, in the actual webinar, I cover topics and questions such as:

  • The best type of development work to outsource
  • What type of development should be kept in-house
  • Top challenges to outsourcing and how to address them
  • The outsourcing model that gives you the most bang for the buck

And much more! Click here to watch the free webinar.

Editor’s Note: This post was originally published in December 2016 and has been updated for accuracy and comprehensiveness.

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