Building your own software development team is hard. Believe me, I know! At a former company, I started as a developer and moved through the ranks to CTO. During that time, I grew the development team from eight people to 130 mobile and web developers. While it was a very rewarding experience, it came with plenty of challenges.

When you choose to build your own development team, you are taking on a lot of responsibility. Hiring, training, and retaining developers is a full-time job. You need to be able to provide a competitive salary and benefits package. That’s on top of equipment costs, management costs, and the time it takes you to run a dev team. These costs seriously impact your app development budget.

If your goal is to build a product, you probably don’t need the distraction of building a technology team while building your product. Focusing on your product is a full-time job in itself, and deciding to build your own in-house team of developers is a long-term commitment to more work. Let’s look at some of the problems you will face when building your own development team. Then we’ll discuss how you can avoid these problems by hiring an agency for your product’s first release.

Problems With Building Your Own Development Team

1. It Requires Planning

One of your first steps in building a team will be to devise a recruiting and hiring process. You will need to find and attract the right candidates to your team. Doing so requires an understanding of what exactly you wish to look for. Then, like anything else, you need to pitch your vision to others. Why should people come work for you?

After you have a plan for recruiting, you need to sort out your hiring process. There are interviews, background checks, paperwork, insurance plans, and other aspects of benefits packages that need to be worked out. If you haven’t already, you will need to set up a payroll system, write a company handbook, and create an employment contract.

2. It’s Time Consuming

After hiring comes onboarding and training. What will your employee’s first day look like? The first few weeks? Who do they report to, and who is responsible for training? How do you define success for your new hires?

All of those questions must be answered, and doing so means spending time considering how you want your team to work. Once you have prepared a plan, you will spend even more time executing it. Team members require time and attention throughout their employment. Sometimes the time investment is unexpected, and personnel issues will typically take priority over all other work.

3. It Requires Technical Expertise

Managing a development team is much easier when you have technical expertise yourself. Understanding programming concepts, software architecture, and development practices will help you make better decisions for your team. Without this expertise, you will need to rely on others to make decisions for you. This can be a problem if you don’t have the right people in place to lead your technology team.

For this reason, most companies will hire a technology leader before they hire any developers. This is a valid solution for supplementing your own technical expertise and ensuring your development team has what they need to be successful. Though, finding a senior person to lead your team is not easy. You will need to find someone who is a good fit for your company culture, has the right technical skills, and is willing to take on the responsibility of leading a team.

4. It’s Expensive

Speaking of senior talent, building your own development team is an expensive endeavor. Even entry-level developers can command a high salary in many U.S. markets. Beyond direct compensation costs, you will need to provide benefits, equipment, and (possibly) an office.

There are also implicit costs. Time and money you might otherwise allocate directly toward your product will be spent on managing your team. Management time, in particular, is expensive. If you are a small company, how much of your time (or your management team’s time) can you afford to spend on building and leading a technology team?

As your team grows, your costs increase. Not only are you paying for a higher headcount: you’re also increasing costs as you retain team members. A larger team size means spending more time coordinating work as well. The larger your team, the more complex communication becomes. Keeping everyone on track takes more time and effort, which translates into money (management salaries, collaboration tools, and lost opportunity costs).

5. It’s Risky

Finding the right talent for your team is a difficult task. Keeping that talent can be just as difficult. You need to be able to provide a competitive salary and benefits package to attract the right people. Securing a new hire is only the first step. You also need to retain your employees, which means regularly adjusting employee pay to keep up with the market. Otherwise, all of your investment in your employee up to this point will have to be made again for a new hire.

Employee engagement is important for long-term retention. Team members must feel like they are part of something bigger than themselves. Their work should have purpose, and they should understand its purpose. A lot of your day-to-day team management work is reinforcing that purpose, recognizing good work, and showing people how they have a meaningful impact on your company’s goals. Failure to do so can lead to employee turnover, a costly and time-consuming problem.

You also need your team to perform. Setting appropriate expectations, providing accountability, and assisting team members in improving their performance are necessary parts of building a great development team. It can take time to figure out the best way for people to work together, and that means it will take time for you to see results.

The Solution

If you notice, in none of the problems above did I mention the actual work of building your product. Some days, when you’re so focused on organizing your team, the work you hired them for can feel like an afterthought! That’s why I recommend hiring an agency to build your product’s first release.

Now, I am a bit biased since Twin Sun is an agency. However, there are several benefits to starting with an agency and then building your own team.

1. Outsourcing Is Affordable

The cost of building your own development team will live with your business. Eventually, having your own team makes sense. However, when you’re first starting out, outsourcing development to a software agency may make more financial sense. Especially when you are validating a new product idea, you may not want to make a permanent hiring decision.

Agencies give you flexibility. Instead of paying for a permanent employee, you can rent a team of developers, designers, and testers for a brief time to reach your product goals. You are only paying for the resources you need to meet your goals.

2. Agencies Are Effective

When you hire an agency, you’re hiring a team of experts that already know how to work well together. You don’t have to worry about hiring the right people, training them, or managing them. A good agency will take care of all of those problems for you, while you reap the benefits of a high-performing development team.

3. You Can Hire Agencies Quickly

Recruiting and hiring your own employee can take months. After years of hiring developers, I found that my best time-to-hire was about four weeks. In general, though, you should expect it to take a few months to find the right person to join your team.

Hiring an agency is much faster. You can find an agency that fits your needs and start working with them in a matter of days. Most of our clients make a decision within a week or two of contacting us.

4. Agencies Are Scalable

Agencies have already made the investment in scaling a development team. They have the infrastructure in place to support a growing team. If you begin working with an agency and need to increase throughput, the agency can allocate more of their team members to your project very quickly. The ramp-up time for adding an agency team member to your project is much shorter than the ramp-up time for adding a new employee to a team they’ve never worked with before.

5. It’s Low Risk

Hiring a person is a big commitment. The expectation for a permanent full-time hire is that they will be with your company for many years. Conversely, hiring an agency is a more flexible arrangement. If you no longer require their services, you can stop working with them. No hard feelings.

Let’s say you start working with an agency and decide they’re not the right fit for your product. You can cut your losses, take the work they completed, and give it to a new agency to finish up. While this process isn’t always frictionless, it’s much easier and faster than firing an employee and hiring a new one.

6. You See a Quick Return on Investment

When you start a relationship with an agency, you should expect their development team to quickly deliver valuable work. The team already exists, knows how to work well together, and has processes in place for delivering high-quality work. Therefore, you should expect to see a quick return on your investment.

When we start working with a new client, we immediately feel like we have something to prove. We wish to earn our client’s trust by immediately showing them our excellent work. We focus on getting a working app in our client’s hands as quickly as possible, usually within the first week. Progress is made daily, with a weekly review to ensure we’re on track. Our clients see us making progress toward their goals every day.

When Should I Build My Own Development Team?

Hiring an agency typically makes the most sense for your product’s first release. If you don’t already have your own development team in place, an agency will get you to market more quickly than a newly formed team. An agency will be able to deliver a working product for less money and in less time than it would take you to build your own team.

However, there will come a time when it may make more sense to build your own development team. After the public release of your product, you will be able to assess how much ongoing development work is needed in the long term. You can compare budget projections from your agency to what it would cost to build your own team to handle the work. Then you can determine which option is better for your business.