Hiring a Software Development Company or Freelance Software Developers: What To Choose For a Startup?

Hiring a Software Development Company or Freelance Software Developers: What To Choose For a Startup?

Embarking on the journey to transform your brilliant app idea into reality is exciting, but the daunting reality of implementation sets in quickly. The success of your startup’s vision depends on meticulous development work, whether your idea is revolutionary or elegantly simple. It comes down to the key decision: is it better to hire freelance developers or to hire software developers from a dedicated software development company? The stakes are high, and the choice is yours to make.

In the previous article, I already discussed when is it time to look for an app development team, how to select the right one, as well as I provided top destinations for software outsourcing and other. If you wonder how to choose the right contractor for your software project, I recommend checking it out.

Here, I’ll meticulously analyse the advantages and drawbacks of both hiring freelancers and software agencies in the realm of startup software development. By the end of it, you’ll have the insights needed to align the right approach with your company’s unique software development requirements.

Hiring a Freelance Software Developer

Before we explore the pros and cons of hiring a software development freelancer, let’s revisit some fundamental insights. Freelance software developers usually enjoy the flexibility to operate in three distinct modes – temporary contracts, freelancing, or committing to full-time work while operating remotely. It’s essential to acknowledge the associated risks, given that freelance developers often manage multiple projects simultaneously.

Advantages of Hiring a Freelance Software Developer

Lower Costs

Freelance developers are famously known for their rather down-to-earth salary expectations. They typically ask for lower pay rates compared to in-house developers. Additionally, as freelance software developers aren’t formally hired, employers aren’t obligated to cover their medical insurance, taxes, work equipment, or consider their integration within the existing team dynamics. Consequently, freelancers benefit from their minimal expenses, allowing them to establish rates considerably lower than those of agencies.

However, if your project is big and you need more people to work on it, hiring a few freelancers may still turn out very expensive.

Specific Skills

Freelancers usually excel in a specific professional field or concentrate on specific domains, making them an excellent choice when you require precise expertise for a particular part of your project. But, it’s very important to carefully review their portfolio before onboarding to determine their technical skills. Sometimes freelancers can present themselves as all-around experts, but it’s important to remember that mastering every skill is very unlikely.


Nowadays, it’s easier than ever to find proficient freelancers. Major online freelancer platforms such as Upwork, Freelancer, and Guru play a crucial role in linking enterprises with expert freelancers worldwide, streamlining the hiring process through simple candidate selection, agreement on terms, contract establishment, and milestone submission.


Freelance developers usually are highly flexible with their time. As private entities, they are not limited by their office hours and often can work in the evening or even on weekdays if something unexpected ever happens. You might want to consider hiring freelance software developers for an urgent software development project.

Disadvantages of Hiring a Freelance Software Developer

Lower Reliability

Working with a freelancer, no matter how skilled, nice and friendly, you put yourself at risk of them not being there for you when you need them. Sometimes we all end up in a situation where we simply need to put our family or health first. Sadly, because of the fact that freelancers work alone, there is no one to substitute them, unlike in a team provided by a development agency.

Moreover, despite the fact that we entrust the freelancers and find their work valuable, it is still believed by some that they may vanish anyway…

Longer Process

As freelancers tend to specialise in particular skills or niches, you may not always be able to find a freelancer that suits all your needs at a time. This is especially true in the case of some bigger, more complex projects. You may often need separate people to take care of the wireframes, UX, UI, Backend, etc. This, to make the long story short, means that the whole process will take more time and, overall, will end up more complex – you will have to complete a team of your own totally by yourself, having to invest in it a lot of your own time.

Not Into Industry Trends

As freelancers work alone, they usually are too busy to be able to track all the new technologies and programs that pop up on the market out of the blue all the time. It is in the agency’s and company’s best interest, though, to ensure that their employees get the certificates and necessary qualifications right in time to be able to provide you with the best up-to-date services.

Many brilliant people possess the above-mentioned skills but cannot effectively create a world-class website on their own.

Andrew Kucheriavy

Quality of Work

Not every contracted professional prioritises the quality of the completed work. Broad platforms like Upwork or PeoplePerHour do not extensively screen the freelancers featured on their platforms. This means you may encounter individuals primarily focused on earning quick money and swiftly completing the project. Maintaining a good reputation is not a top concern for these freelancers, given the option to create new accounts or operate anonymously.

Lack of Further Support

Furthermore, freelancers might not consistently provide continuous maintenance and support following project completion. This could potentially leave you without the necessary assistance in dealing with future updates, bugs, or other issues that may emerge after the project has been deployed.

To Sum Up: When to Hire a Freelance Software Developer?


  • are good for small projects or specific tasks
  • are less expensive than an in-house team
  • don’t require a lot of paperwork: you can hire the best experts through a freelance website


  • they are not suitable for large and complicated projects
  • they don’t work with each other, so it might lead to miscommunication and misunderstandings
  • you need to manage the project or hire another specialist to do that
  • freelancers may resign from cooperation at any time

Hiring a Software Development Company

Let’s discuss the pros and cons of hiring a software development company. These companies typically provide a structured approach to projects, leveraging their expertise and collaborative teams. Their operating model typically includes a range of services, including project-based contracts, continuous development collaboration, and a dedicated development team. Understanding the possible advantages and considerations when choosing a software development company is essential, especially compared to freelance developers who often handle several projects at once.

Advantages of Hiring a Software Development Company

Better Organization

A software development company will usually have project managers of their own – willing to help with keeping up with the schedule and not exceeding the costs – and the whole software development team ready to work for you, share their expertise and fix any issues you may come across.

Faster Progress and Better Results

Such outsourcing software development companies tend to rely on teamwork to a huge extent. It is of great importance when you want your project to be delivered quickly, smoothly and to be perfectly polished. They share their knowledge within the whole software development team – how to fix bugs, what solution to choose for a particular problem, how to decrease the overall cost of development and maximise the benefits for the users and many more. This is a giant advantage of software development companies that allows them to specialise and provide services in different fields of software outsourcing.


Working in a team means a great deal of flexibility when it comes to one’s skills and availability. Coworkers can easily help and substitute for each other in times of need.

Sometimes the main drawback of choosing development agencies lies within the fixed working hours, traditionally 8 am to 4 pm. Happily, the very most modern companies have recently changed that system to suit the needs of their clients and give their employees more of a choice. Thanks to that, contact with an offshore software development company during your working hours will not be an issue anymore.

Further Support and Continuous Maintenance

A great side of cooperating with software development companies on a bigger project is, for example, receiving feedback on your app with somebody running tests throughout the whole period of your cooperation, which will allow you and your hired developers to improve the project on the way and in the future (during further maintenance). Another nice ‘pro’ is the possibility of being assigned a project manager who will oversee the whole process and make sure that everything is done on time.

Unlike freelancers, agencies prioritise establishing long-term client relationships and ensuring client satisfaction is a priority. This approach is mutually beneficial for both parties involved in the entire software development process. Software agency wants to help you on each stage of the software development lifecycle, including business analysis, ongoing professional maintenance, and nurturing of the initial idea. You will not have to waste time introducing a new team of software developers to your project and documentation multiple times and the software company will have a happy client and income continuity.


While hiring someone from a development agency you can be sure that the work will start quickly, usually within a few days. You save a great amount of time on reading applications and interviewing people that may not be even qualified for the job. Just take a look at a few already prepared for you inside-CVs of professional developers of this particular software development company you choose. You can be sure that each and every person you are being offered is reliable, has great expertise and have proven themselves many times.

For further insight into the pros and cons of outsourcing your projects to software development companies, I suggest you check out my related article. In this article, I analyse whether differences in time zones, financial resources, and communication are indeed the main disadvantages of outsourcing software development, weighing them against the benefits!

Disadvantages of Hiring a Software Development Company

Higher Costs

Software development companies are in general slightly more expensive, especially when it comes to simple projects. However, if you need to work on a bigger thing or fancy long-term cooperation, they will prove of great value for the money you have paid. It is also not a problem to have them working for you fulltime, unlike self-employed software developers who may have to divide their time between two or more development services.


Although outsourcing to companies far away from your country (so-called off-shore outsourcing model) might be a cost-effective solution, it may have issues you must be aware of, like the risk of miscommunication. First, you and your contractor will probably have different native languages, so make sure you understand each other right. Software engineers not speaking the target language nor English fluently make communication between the parties difficult in general.

Secondly, sometimes different cultures equal different approaches to fields related strictly to doing business and work, so work ethic can mean different things in different places. Therefore, even if the company is vocational and hires professional developers, sometimes you won’t be able to overcome these obstacles and avoid miscommunication.

That’s why, it’s worth checking out the company reviews on platforms like Clutch, GoodFirms or TechReviewer until you make a decision about the cooperation.

To Sum Up: When to Hire a Software Development Company?

Software Development Companies:

  • are more reliable than freelance software developers
  • you can count on a better outcome than expected
  • offer longer cooperation and further support
  • have a team of experts in different fields, including project management
  • have a team that got used to working with each other


  • you may encounter communication issues or cultural barriers
  • they are in general slightly more expensive

To conclude…

It is necessary for you to remember that each case is different and that there is no right or wrong choice. Both hiring a freelancer or an outsourcing software company means a great dose of assets but sadly, both of these options also come with a certain amount of risks. You should weigh the pros and cons thoroughly and see which kind of cooperation (with freelancers vs software development companies) better suits your needs so that you easily reach your advancement goals and get the best software with no legal issues and with great hourly rates.

Egor Saharov
Solution Consultant

Egor is here to guide you towards optimal IT solutions, ensuring you stay steps ahead of competitors while fostering lasting relationships with Teacode.  Specialising in web and mobile development, he seamlessly integrates Artificial Intelligence into his work. Healthtech, Fintech and Traveltech are his areas of expertise.

Katarzyna Sobczak-Rosochacka
Katarzyna Sobczak-Rosochacka

Egor is here to guide you towards optimal IT solutions, ensuring you stay steps ahead of competitors while fostering lasting relationships with Teacode.  Specialising in web and mobile development, he seamlessly integrates Artificial Intelligence into his work. Healthtech, Fintech and Traveltech are his areas of expertise.