Choosing between hiring a dedicated software development team or building it in-house can be a choice between making or breaking a startup. Let’s discuss the pros and cons of each approach! A team of software developers is the backbone of any technology startup nowadays. It is the crucial business asset required to build an MVP. They also are essential for the ongoing product support and development, as well as for scaling the startup to the enterprise when the time comes.The other side of the coin is the high total cost of ownership (TCO) of such an asset, as employing a sufficiently large team of developers is a time-consuming, costly and laborious process. Pros and cons of hiring a dedicated team of software engineers This is why many startups opt for hiring a dedicated software development team from a managed services provider (MSP) instead. The benefits of this approach are the following: of a dedicated software development team. You pay only for the work hours spent and once the project is completed, the expenses stop; Greatly decreased TCO and ample hands-on experience. The team knows what to do and how to do it, providing transparent monitoring at the same time; Structured workflows . MSPs usually have scalable teams with specialists of all kinds that can begin working on your project from the day one; Greater talent pool available at once ensuring correct task delegation and strong team spirit. The team members are used to working with each other, which lowers the risk of workplace conflicts that can be quite damaging for the project; Established in-team collaboration is possible if a team member takes a sick leave or quits the job. Rapid replacement is provided to ensure quick onboarding of any new specialist to work on the product in the future. Detailed product documentation There are more subtle benefits of hiring a dedicated team of developers, but they will be listed in a separate article. As for the drawbacks of choosing to hire dedicated software developers, there indeed is a couple: MSPs can support a broad range of products for a variety of customers, meaning the team’s time might be cramped with other tasks. Thus said, allow for , as finishing the product in the shortest time possible might be quite difficult. slightly broader estimates Working with a dedicated team of software developers requires . Be prepared to ask lots of questions aside from the Project Manager’s reports. This is your product, after all, and you should keep a close eye on its development. a lot of remote control of the process Thus said, hiring a dedicated team of software developers can be a huge benefit for a startup. They will get the job done and help launch and support the product. Nevertheless, the startup can hardly survive without building an in-house software development team. This is crucial to ensure business continuity and ongoing product evolution, so we must consider the benefits and drawbacks of this approach. Building an in-house software development team: pros and cons It goes without saying you must have an in-house team of IT specialists, both DevOps engineers and software developers. The question is, when do you have to start building it? We sincerely believe this process should begin ONLY when the product is launched and the startup passes the sustainability point. Only then you will be able to devote the significant resources (be it the next round of investments or product-generated revenues) to building an in-house software development team. Here is why: . Whether they have their hands full with bringing more value to the product or devote the minimum effort to ensuring the product’s stable performance at the moment — you have to pay them wages monthly. In-house specialists are on the payroll software developers and DevOps engineers . It is a long process of utmost importance, as the errors there can cost you dearly. In-house have to build the teams, the workflows, and the corporate culture as they go You have to hire the in-house software development team one by one, which is not an easy task. This means till the appropriate IT specialist is hired. The MSP can step in with the outstaffing assistance, yet eventually, all of the key team positions should be filled by in-house staff. certain parts of the product (or its delivery pipeline) might be put on hold As you will most likely hire a single specialist to cover each workflow part, . IT outstaffing can be a temporary solution, too, yet ensuring the redundancy by hiring at least a pair of IT specialists to cover each aspect of the workflow. This means paying 2 salaries, sure. if this employee goes on vacation, quits or even takes a sick leave, the corresponding part of the process comes to a halt Nevertheless, building an in-house team of software developers is hugely beneficial for a startup for multiple reasons: . The team that works on your product day by day knows it better than any contractor and can assess the current state of affairs and the preferred direction of product evolution. Experience continuity an in-depth product knowledge . Your personnel develops respect and proper attitude towards the company if you treat them right. This makes working long hours and dealing with issues outside of work hours much easier, should such a need arise. Company culture and 24/7 availability . If your in-house team of software developers is properly motivated they pay sufficient attention to self-development, gain new skills and become more valuable as professionals. They tend to ask for bigger salaries then, yes, but having a proficient, skilled and motivated software development team on board is a huge benefit of its own. Such a team can both drive more value to your customers and increase the value of your startup in case of exit, merger or acquisition. Stockpiling skills means adding value Thus said, it doesn’t mean you have to avoid hiring an in-house software development team. We only suggest you do so once you are able to support the team and scale the business quickly. Until then, hiring a dedicated team of IT engineers from any MSP should suffice. Final thoughts on hiring a dedicated software development team VS building it in-house As you can see, both hiring a dedicated software development team from a managed services provider or building an in-house team of software developers are viable choices for a startup. Being an MSP ourselves, IT Svit sincerely recommends hiring a dedicated team to deliver an MVP and release the product prior to building an in-house team to support and evolve the product further. The choice is up to a startup, of course, and if the startup decides to opt for the former approach, the only question left is how to hire a reliable team of developers from a trustworthy MSP. We cover this topic in one of the next articles of this series. Do you have any questions or concerns on the topic? Did you have any remarkable personal experience dealing with the situations described above? Please share it in the comments below! Should you like to hire a dedicated team of developers from one of the — feel free to , we will be glad to help you! top 15 Managed Services Providers worldwide contact us Initially, this story was posted on my company’s blog — https://itsvit.com/blog/hiring-dedicated-software-development-team-vs-building-house/
