Questions we answerOutsourcing and external support
Should I hire in-house or use an agency for development?
An agency is right for a defined build with a specification and an end. In-house is right when the product is continuous and the context has to stay.
Free · a few minutes · starts from “I think we need another person”
The short answer
An agency fits a defined build: a specification, a scope and an end, where speed matters more than accumulated context. In-house fits a continuous product, where knowing why past decisions were made is most of the value and where nobody wants to re-explain the domain every engagement. The failure mode is using an agency for continuous product work: it looks faster for two quarters and then you own a codebase nobody in the company understands. Plan the handover before you start, not at the end.
Agencies are good at defined builds and structurally poor at open-ended product ownership, which is not a criticism — it is what the model is for.
The question is therefore less about quality than about shape. Is this a thing to be built, or a thing to be owned?
Is it really this?
Worth checking before you spend anything. These are the signals that tend to tell the two apart.
Signs it is
- You can write down what is being built and what done looks like.
- There is a deadline that a hiring process would miss.
- The work is a bounded project rather than the whole product.
Signs it's something else
- The product changes weekly and the specification would be stale before it was signed.
- The technical decisions being made now will constrain the business for years.
- You would be handing over the core of what the company does.
What's usually behind it
- A product that needs building faster than a hiring process can deliver.
- No technical person in the company who could assess or lead an engineer.
- A defined project with a deadline attached to something commercial.
What people usually get wrong
- Treating the agency relationship as a substitute for technical judgement inside the company.
- Not agreeing documentation and handover at the start, and inheriting a codebase nobody can explain.
- Rolling a defined project into an indefinite retainer without re-deciding.
The options, and when each one fits
In no particular order. Which of these fits depends on your situation, not on the question you typed.
Agency or studio build
A defined project with a specification, a deadline and an end.
Hire in-house
Continuous product work where context and ownership compound.
Both, deliberately
An agency builds while you hire, with handover planned from the first week.
When doing nothing is the right call
If nobody in the company can assess technical work, fix that first — a few days of an experienced technical adviser improves whichever route you take and costs a fraction of either.
What the diagnostic asks
- Whether the gap is capability, capacity or both.
- How central the work is to the business.
- Whether it could realistically be delivered outside the team.
- Whether a permanent hire is fundable and how soon it is needed.
“I don't know” is always an answer. Nothing is assumed on your behalf.
The routes it weighs
Every diagnostic weighs all ten routes. These are the ones that tend to matter for this question — a description of the rules, not a promise about your answer.
Recruit
Recruit a new person for a durable, sizeable need that is central to the team.
Outsource
Hand a defined, ongoing scope of work to an external provider.
Specialist support
Bring in a freelancer, consultant or specialist for a defined piece of work.
Do nothing yet
Record the issue, set a revisit date, and decide what would change your mind.
Offshore
Run a defined scope of work with a team in another country or time zone.
What changes the answer
- A specification with an end date favours an agency.
- A continuous product that will change for years favours in-house.
- Having nobody who can assess technical work is a risk in both directions and worth solving first.
Get your own read
A handful of short questions, then the strongest route for your situation, what's also credible, what we still don't know and what would change our view. No account, no setup.
Related questions
- When should a startup hire its first engineer?When there is durable technical work, someone who can judge technical quality, and enough definition for an engineer to own something rather than wait to be told.
- Do I need a CTO or a lead developer?One sets technical direction and builds a team; the other builds the product well. Most early companies need the second and advertise for the first.
- Should I outsource or hire?Outsource when the work is a definable outcome that does not need to live in your team. Hire when it is core, durable and needs to be owned by your own people.
- Is it cheaper to hire or outsource?Outsourcing is usually cheaper over months and more expensive over years. The comparison that matters includes management time and what you are left holding at the end.
- Should I use a fractional executive?Fractional works where you need senior judgement rather than senior capacity, and where someone internal can carry the execution between sessions.
- Should I offshore part of my team's work?Only if the work is well documented, repeatable and definable, and you have the management time for hand-offs. It is not automatically cheaper or better.