In short
- A software house gives a fast start and a full team (frontend, backend, testing) without recruitment - good for a project with a defined scope.
- An in-house team makes sense when software is the core of the business and will be developed for years.
- A mixed model combines your own product lead with external engineers and lets you scale the team.
- Whatever the model, make sure the source code, copyright, documentation and access stay on your side.
- For an in-house team count the full cost: recruitment, onboarding, cover, testing and infrastructure.
Three models
- Software house: you commission a project from a company with a ready team and process. You own the goals and decisions, the vendor owns delivery.
- In-house team: you hire developers, testers and a technical lead. You have full control and the knowledge stays in the company, along with full responsibility.
- Mixed model: you have your own lead or product owner, and engineers come from an external company (team augmentation).
Comparison
| Software house | In-house team | Mixed model | |
|---|---|---|---|
| Time to start | Weeks | Months (recruitment) | Weeks |
| Cost | Variable, per scope or hours | Fixed, also between projects | Part fixed, part variable |
| Skills | A full team straight away | As many as you hire | Added as needed |
| Product knowledge | With the vendor, has to be handed over | In the company | Grows in the company |
| Scaling | Easy | Hard and slow | Easy |
| People leaving | The vendor's risk | Your risk | Shared |
When a software house
- You have a specific project with a defined goal rather than ongoing product development.
- You have no IT department, or yours handles maintenance rather than building new systems.
- Time to start matters - there are no months for recruitment.
- You need many skills at once: interface design, frontend, backend, integrations and testing.
When an in-house team
- Software is the core of your business and a source of competitive advantage.
- The product will be developed for years, daily, in close cooperation with the rest of the company.
- Domain knowledge is so specific that handing it over to an external company would cost more than hiring.
Remember the full cost: recruitment, onboarding, holidays and cover, tools, testing and server maintenance. One developer is usually not enough - someone has to review code, test and stand in.
The mixed model
In practice many companies start with a software house and later build a team that takes over development. Others have their own lead and a few developers and add external engineers in busy periods, working in their tools and process.
The condition for success is the same: the code, documentation and technical decisions are available to your company, not only in the heads of outside people.
How to avoid vendor lock-in
- The code repository on your account, or handed over regularly - not only at final acceptance.
- Copyright in the code settled in the contract - a transfer or a licence, with defined fields of use.
- Technical documentation and a deployment guide, kept up to date during the project.
- Admin access to servers, domains, databases and third-party services on your side.
- Widely used technologies instead of niche ones, so it is easier to find people for further development.