It’s time to start searching for a company, and your first thought is, where do I start? What’s it like to find the right software development company? Is it like buying a car? Hiring a new employee? Shopping for a company health care plan?
Each of the different search types listed above has a domain of knowledge that informs how the search process progresses. As a result, one can understand the playing field and can save time by parsing options quickly. Therefore, we need to describe important factors and understand the terms that relate to searching for software companies.
Types of Software Development Companies
Large Developer Companies
Big developer companies may have over 150 or 500 developers. It’s up for debate where to draw the cut-off between large and midsize development companies. In large development companies, it’s reasonable to question:
- Am I getting the best team? Or just the next available team?
- How many of the developers are employees of the company?
- Where is the company based?
Companies with upwards of 1,000 developers can be found in areas outside the U.S1. Overseas companies may present a competitive price but raise a slew of other concerns that, in my opinion, make the option unattractive. For example, barriers exist around language, time zones, work culture, industry standards, payments, and legal obligations.
Midsize Software Development Companies
This group constitutes companies with 50-500 employees or developers. With a team of this size, you can expect to find full-service product offerings2.
Additionally, you should expect the areas of focus to shrink. So, maybe at a larger company, they try to do everything (web development, desktop application, mobile apps). At a midsize company, there’s still variety, but there’s a smaller focus.
There’s no shortage of talent and experience at these companies. But, how much of it are you getting? We’ll cover essential questions and how to talk to development companies in a future article.
Single or Extended Team Software Development Companies
Everyone at these companies works directly or is an acquaintance of everyone else. They’re small enough that the lines of communication stretch from the bottom of the team to the top and from one side to the other.
Again, the company’s marketing information focuses on a handful of software products, services, or other offerings. They have a mix of specific use cases and general case studies for their products. A benefit to working with single or extended team companies is you have their attention.
Software Houses, Developer Agencies, and Freelance Developers
It’s hard to parse the market when people interchangeably use terms like software house, developer agencies, and software development companies. So, let’s try to untangle the mesh of words.
An agency is a collection of individuals that operates under a single brand or trade name. They leverage the agency to advance themselves while paying percentages of profits or dues to the agency. This model is how a real-estate agency works3. As well as the brand recognition next to their name, individuals can tap into the knowledge and gain mentorship within the agency.
One way to define a software house is “…a company that specializes in building software products4. My understanding, and this definition, represents software houses similarly to software development companies.
Freelance developers operate independently. They are beneficial for helping out with backlogs or providing timely specialized knowledge. However, they have many constraints on what they can accomplish because they have to perform their services and run the business. Furthermore, their work capacity has a hard limit because they can’t pull work hours from other employees.
After reviewing the different types of companies, it’s reasonable to wonder which option is right for you. In the next section, we’ll look at considerations that can help you define more concise search criteria.
Considerations for Your Search
The first and significant consideration for your search is, does this company work with the technologies that my software requires? Unfortunately, advances in software and technology have created large silos that companies are unable to escape from or access.
Therefore, using what you know from the previous article on software types, you can start to look for a custom software development company that (probably) does the work you need.
It’s helpful when companies provide case studies on work they’ve done in the past. The studies provide a reference point for your future project.
Freelancers and agencies can struggle with large project scopes. This is undoubtedly the case with freelancers. If you’re looking to build a complete application that needs to operate for thousands of users, you’re not going to find it in a freelancer. The caveat is that you have a very long time-to-build horizon and can wait for the project to ramp up slowly. Even then, the freelancer’s experience or the agency developer’s resources have a limit.
However, that’s not to say that you should only consider a large developer company if you have a broad scope. Small to midsize development companies can handle large projects, but you need to look above a certain level for new web applications. Conversely, small jobs may be rejected by medium and large size companies because they don’t produce a sufficient gross profit.
Finally, for project scope, there could be ongoing services that you’re software needs that a company may not offer:
- Customer service
- Bug reporting and fixing
- Error and downtime monitoring
- Software and hardware upgrades
Many behind-the-scenes actions keep an application running and up to date.
Next, consider when you need the project done. Smaller teams may be limited on how quickly they can build, depending on their current client workload. If you need something done quickly, you can look for larger-sized developer companies and expect to pay a premium for speed. Your chances of getting a team right away increase when a company has a larger pool of developers.
On the other hand, if you have a longer time horizon, you can search for a specialized team to build your software and wait for their availability to open.
Similar to project scope, the budget for the project may exclude your project from companies or exclude companies from your project.
Unfortunately, the project cost isn’t something that companies advertise because the needs of clients vary. You’ll have to get a quote from a company. This shouldn’t exclude a company from your search. Perhaps, your capital budget was naive in estimating the cost of the new software, and the right company is just a bit more expensive than the original plan.
The geographic location of the company and its workers acts as a robust filter when searching for a company:
- Do I want to work with only U.S companies?
- Do I want to work face-to-face with the company?
- Will time zone or language differences be an issue?
If you’re feeling overwhelmed in your search, you can start searching locally and get the feel of a smaller market before searching the entire globe.
Companies love to advertise their experience. Company websites will feature previous clients, time in business, or customer reviews.
Experience often comes at a premium—and for a good reason. Because of the inverse relationship between knowledge and cost, your budget may help determine the experience level you can afford.
Ways to Find a Software Development Company
Next, I’ll list different ways to start your search to build a potential list of software development companies.
Some sites help filter software development companies. Although not comprehensive, these sites can provide potential candidates, reviews, company size, price, and location.
Furthermore, if you hear about a company through a reference, or in an article, you can research them on these sites.
Magazine and online publishers build shortlists for software developer companies. They are typically one of the first things that turn up in an online search. Sometimes, these lists contain bias toward a company, with companies going so far as to pay to have their name included on the list. However, it’s hard to hide the bias, and I think they are helpful regardless because they provide a handful of companies that are considered competitors.
The New York Times Bestselling book, Who: The A Method for Hiring, tries not to undervalue the benefits of sourcing talent through referrals. They suggest being vigilant in keeping an eye out for new talent and asking people in their circle for referrals5.
Similarly, referrals are a valuable method for sourcing potential software companies. Most likely, you have seen a website or application that operates similarly to what you want. The next step is to ask the owners of the company who did the work.
If people love their software, they’re not shy to share the company that built it.
Another way to source companies is using Google Maps. This might be the best way to discover companies if the geographic location is essential to you. Google keeps business profiles similar to review sites, and you can read customer reviews, see ratings, and gather contact information.
We started this article by discussing the types of software companies. The segmentation of companies was performed mainly through the size of the company. As the size shrunk, the companies became more specialized, and the attention to each client grew. Also, we distinguished between common terms like software house, agency, and freelancer.
Then, we looked at search criteria: tech stack, scope, time-to-build, budget, location, experience. Only the business can assign a weight to each standard to help aid their search.
Finally, we listed ways to search for a company, including articles, referrals, and Google Maps.
In the following article, we’ll discuss talking to software companies and acquiring relevant information. Also, we’ll explore common mistakes and misunderstandings that companies have. In the meantime, I recommend gathering up the requisite information and starting your search!
1 5 Types of Software Development Outsourcing Providers. 8 May 2019, 8allocate.com/article/5-types-of-software-development-outsourcing-providers/. Accessed 30 Sept. 2021.
2 Mayfield, Dayana. “The 3 Types of Software Development Agencies & Which to Choose – DevSquad.” Devsquad.com, devsquad.com/blog/software-development-agencies/. Accessed 30 Sept. 2021.
3 Forsey, Caroline. “Marketing Firm vs. Agency: We Break down the Difference.” Blog.hubspot.com, blog.hubspot.com/marketing/marketing-agency. Accessed 30 Sept. 2021.
4 Mroczkowska, Agnieszka. “What Is a Software House? Definition, Types & Key Features.” Droids on Roids, 25 Mar. 2020, www.thedroidsonroids.com/blog/software-house-definition-and-meaning.
5 Smart, Geoff Ph.D. and Street, Randy. “SMARTtools for Leaders.” Who: The A Method for Hiring, whothebook.com/smarttools-for-leaders/. Accessed 30 Sept. 2021.