7 Steps to Start a Software Development Company by@ameliajohnson

7 Steps to Start a Software Development Company

Amelia Johnson Hacker Noon profile picture

Amelia Johnson

I'm an investor. My current product is with the numbering systems. I'm working on the Hexadecimal to decimal conversion.

To start a software company is pretty easy to compare to starting other businesses. For a software company, you do not need a place to store goods or you do not need to worry about the retailers, whole-sellers, or manufacturers.

All you need to start a software company is high-speed Internet and a laptop. With these two assets, you can start working as a freelancer. You can sign up for Upwork or Freelancer and kick-start your freelancing career. In case you are not able to get projects on-board, you can take buying a pro-account into your consideration.

Wait, Why Starting as a Freelancer is Important?

Having a good amount of technical knowledge is not sufficient to start a software company, especially for a service-based-company. It is really important to understand this aspect of business in detail. When you work as a freelancer, you have to deal with the CEO, COO, Managing Directors, Account managers, or in some cases the technical SEO team.

Working with such designated employees helps you to gain knowledge about these aspects of a company. If you are doing a job under someone then you may not get a chance working with all these experts initially. For that reason, working as a freelancer initially is important.

Things to Take care of while running a software company

Now, considering you have around 3-4 freelancing projects running and the next step is business expansion. Considering the following points while starting/running your software company:

Partnership or business loan?Invest more in the sales teamPerform proper market researchInvest sensiblyHire experiencedAdd securityDo not miss marketing

1) Partnership or business loan?

This is a million-dollar question. If you successfully get 4-5 projects on-board on your own from either Linkedin or any other freelancing network, then you can consider opting for a business loan otherwise you should search for investors. Remember, when to consider business-loan, you will total control over your firm to make any decision and for the partnership, you need votes for every other partner/investor.

2) Invest more in the sales team

You should not under-estimate the importance of the sales team. The sales team is the base of any business. Having a good sales team helps getting more projects and it means business expansion & growth. Along with more business, the sales team makes sure brand reputation in the marketing, customer relationships, and retention of customers.

3) Perform proper market research

Along with sales, performing proper marketing research is also useful for business growth. A few years back, jquery’s market was booming around the world. Most of the companies were considering jquery for the front-end development while today, other Javascript frameworks like Angular, React, and Vue.js is the top priority of companies for front-end development.


You can consider the above screen-shot from Google trends. Back in 2013, Jquery was ruling the front-end programming while Angular and React were new and most of the developers did not trust it. While today in 2020, the market trend is the opposite and this may change in the future. For the technologies you are not aware of, it is really important to perform proper market research before making any investment or hiring employees with those skill-sets.

4) Invest sensibly

It is really important to invest sensibly in a software company. It is important to think twice before investing in budget Laptops, infrastructure, and office location. For a service-based software company, location does not matter. Most of the clients are not going to visit your office, all the meetings are going to be performed online on skype call. If required, your sales team is going to visit the client’s location. So, investing too much amount of the funds in the infrastructure, designs, and office location is not required.

When it comes to laptops, it is really important to buy such best budget laptops which are good for programming. For programming, you need a laptop with at least 4 GB RAM, advanced processors, and enough storage.

5) Hire experienced

Experience does matter a lot when it comes to leadership and guidance, especially for a start-up. The experienced employees bring less risk to the firm and they have better knowledge. Apart from that, experienced employees are multi-taskers and adaptable to the situation. Most importantly, they know how to get things done in the least amount of time. So, initially experienced programmers may seem expensive but eventually, they are the most important reason behind client retention and quality work.

6) Add security

Most of your clients and code are going to be on the cloud instead of the local storage. A few months back, hackers hacked Elon Musk, Joe Biden, Barak Obama, Bill Gates, and few others. This hack was performed by the social engineering technique.

Not only the external hackers are a threat to your company, your sales team needs to be careful with your employees. Many companies give the sales team a different work-area to avoid any security threat to the sensitive client’s information. So, you need to make sure to make all the information saved on the cloud is password protected. All the emails should be one-time password protected with an authentication software. This will minimize the chances of security threats.

To reduce the security threat, you can use numbering languages like binary, octal, and hexadecimal to save decimal numbers into your excel sheet or database. Many startups consider decimal to binary conversion techniques to enhance security. You can consider a decimal to binary conversion tool for the encrypted conversions between your team members.

7) Do not miss marketing

If you have access funds, then do not waste a second and invest it in either SEO or PPC. You can either hire full-time digital marketers or hire freelancers. In the long run, SEO is beneficial for lead generation, online reputation management, brand awareness & credibility.

If you are looking for quick leads, then you should consider pay-per-click marketing. PPC can generate great business leads from the very first day of your ad campaign. PPC is way more expensive than SEO, so you need to make sure that your company has enough amount of funds for such a campaign.

Bottom line:

To run a software development service-based company is easier than the other businesses if you execute all your plans correctly and invest sensibly. It becomes way easier when you not only know programming but also you are aware of the sales, marketing, and network trends.

So, it is recommended to study every aspect in detail and then start hiring
employees, investing in place, infrastructure, and other electronic equipment.


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