Rapid Growth

Why Fast & Cheap Development Can End Up Costing You More

Adam Korman
December 13, 2023

Improved tools and development frameworks have made building software cheaper and easier than ever. While that has led to all sorts of rapid innovation, it has also created an alluring trap, especially for early-stage, non-technical founders. What they often learn is that dev shops that are half the price are actually twice the cost in the long run.

The Lure of Lower Costs

Dev shops will sometimes pitch attractive pricing models based on the low cost to build software. Those prices are often built on a core assumption: relatively inexperienced developers (whether they are local, near-shore, or completely off-shore developers) can quickly build precisely what you want – fast and cheap.

Hidden Costs

Building exactly what you ask for – nothing more and nothing less – might be cheap, but it’s rarely the case that you can clearly identify and communicate every requirement up front. Common pitfalls people run into with outsourced dev:

  • Things you take for granted aren’t included in their upfront estimates. You only find out they didn’t build functionality you assumed was implied until you’re deep into the build process.
  • Things are built exactly to spec. You gave them basic mockups or wireframes – not final designs – and they built exactly what you gave them, even if it doesn’t make sense.
  • Communication barriers. The challenges of working with off-shore teams are well known – not least of which is working across timezones. They send a question, you reply the next day, they ask for clarification the following day, and so on. Progress slows to a crawl. Even if the bulk of the team is in your time zone, a lot of dev shops mask how inexperienced their developers are by keeping them at arms length from their clients. You have to provide literal, explicit, and comprehensive instructions to your project manager, then rely on them to break that down in a way the dev team can understand. It’s not long before you feel like you’re playing an endless game of telephone.
  • Built to run, not to scale. It’s not too hard to throw together something that’s good enough to get through a demo and seem to work with no load. When you get to production, will it scale with real usage? Will it gracefully handle all the edge cases you didn’t initially consider? Is it secure? Like building a house, it may look great during a walkthrough, but it’s not until you move in that you find out the foundation isn’t solid, the plumbing is shoddy, and the electrical wiring is dangerous. And everything is much more expensive to fix after the drywall is up and the walls have been painted.
  • Built to scale, not to launch. At the other end of the spectrum, you might find that your dev team is so caught up in building a bullet-proof system that you’ve run out of funds building infrastructure before you’ve even figured out if you have a viable product.

Shady Practices

Hybrid Shops

Even if you’ve figured out that cobbling together your own team of freelancers at $5-$10/hour is probably a bad idea, you might find yourself looking at “hybrid” shops that claim to have access to a huge pool of international talent. It’s not quite as cheap as directly hiring freelancers, but not as expensive as working with a top-tier team. In practice, your local project manager is often just providing a thin veneer between you and the same cheap, inexperienced resources that you wouldn’t trust to build your app. Those developers aren’t getting paid any more, and they often sacrifice security, performance, code quality and scalability at every turn.

Death by Change Order

How do these places ultimately deliver? More time, more money. They rely on the sunk cost fallacy as a business model. You’ve already spent a decent amount of money, the problems and delays are often blamed on you, and the only way out is through costly change orders.

IP Woes

Are you sure you own your IP? If your “partner” has subcontracted out the development work to a third party, you may later realize that you don’t own the code or the intellectual property you thought you were creating. Or, you may own the IP on paper, but how comfortable are you that subcontracted workers in another country won’t just take the code to re-sell or create a copycat product of their own, despite what your contract says.

If the workers and governing authority are in another country, even if you have legal protections in theory, you have to consider whether you have the time, money, and resources to pursue international IP claims.

Long-Term Implications

When you’ve found yourself backed into a corner with a bad implementation, you’re faced with a hard choice: is it better to salvage what you’ve built or start over from scratch? What you’re left with is all bad:

  • Brand Damage: You only get one shot to make a first impression with customers. If you launch with something that’s not great you may lose any chance to win them back.
  • Additional Costs: Whether you forge ahead with a sub-par team or try to hire a new team to fix the issues, it takes time and more money than you may have budgeted for. Even a top-notch team might struggle to fix inherited code that was bad from the start – they might recommend starting over from scratch.
  • Lost Opportunities: The market moves quickly. By the time your product is ready to launch, if you’ve wasted months getting a basic version to even work you may have missed your window of opportunity. Instead of adding critical features, refining and improving your product, you might spend months just trying to salvage a minimally working version of your product.

Making Smarter Choices

Most people who hire an outsource team don’t need code, they need a problem solved. An experienced team who understands what you’re trying to accomplish will do much more than build what you’ve asked for. It will feel like working with a partner that’s invested in your overall success rather than a vendor supplying you with a commodity.

A team like that will have people on tap and resources available in roles you might not realize you needed: a software architect, a user experience designer, a product manager, a strategist, and so on. You may have some of those roles covered internally, and you may not need them full-time on your project, but having access to all the resources you might need as part of a comprehensive, integrated, experienced team is often critical to long-term success of a project.

How do you evaluate whether you’ve found the right partner?

  • Due Diligence. Vet the team thoroughly by looking at their prior work, talking to current and former clients, probing them about how they operate day-to-day, and finding out about the makeup and experience of the team they expect to put on the project.
  • Start Small. It’s not always practical, but if you can, start with a small evaluation or kick-off project focused on requirements, research, design, or prototyping. It’s often the first phase of any project anyway, and can give both sides of the arrangement a feel for what it’s like to work together before making a large, long-term commitment.
  • Understanding True Costs. Find out how the team approaches questions of quality, reliability, and scalability. Who covers the costs for servers and tooling? Delve into how they handle QA and DevOps. What’s the team’s experience building apps that handle thousands, or hundreds of thousands of users?


Some people get lucky – they hire a cheap offshore team and it’s a smashing success. But is that an outcome you can afford to bet your business on? At the root of most of the problems with outsourced development is dev shops that are focused on just two things: building software and doing the bare minimum to fulfill a contract. While a top-tier partner may have high rates, you often end up spending less money overall because they will focus on problem solving – building what you need, not just what you ask for.

About Uptech Studio

Did you hire a team that didn’t deliver? Are you evaluating your options before you get started? Either way, we’re here to help. At Uptech Studio we partner with our clients to deeply understand what they are trying to accomplish and we have an experienced team with a proven track record that will help you get there. Do we have sharp product folks, create amazing designs, and write rock-solid code? Yep, that too.

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