Software development company vs. Freelancer

If you’re reading this, you probably have a great idea for a web project or an app. I’m sure that you already know all the alternatives to do it. You have a friend of a friend who develops everything very cheap, a garage full of programmers in India, freelancers, outsourcing software development company, and even do it by yourself. But the most common options are hiring a freelancer or software development company.

Freelancers are independent professionals that have specific skills. They either work for a few companies as a contractor or have their own clients and are self-employed. A software development company is a multidisciplinary team of professionals that offers full-cycle services from consulting to product maintenance.

Before the product development - you must decide Whom will you trust your business idea?

In a world full of startups, there’s no standard solution. Every project is different, and small and medium-sized business needs custom software to solve their biggest challenges.

That’s why there is no single answer to that question. We can’t tell you whether freelancers or software development company are “better” choice, but in this article, we would like to highlight the pros and cons of each to help you make the right decision when it comes to hiring people you really need for your project.

When to hire a freelancer?

It depends on each case. However, a freelancer is an excellent option for certain tasks and specific activities. If you have the resources and platforms to hire a team of freelancers, you can work on projects and develop products. But, be careful! Coordinating the work of several people separately can be a difficult task.

Let’s see the pros of hiring freelancers.

  • Normally, freelancers have lower rates than companies, approximately you can expect to save 20-30% of the cost of a software development company. You are not paying overhead cost such as health insurance, and you’re not paying for the office space or office supply.
  • Freelancers are highly skilled and strive to get solid expertise in one specific area. As we already mentioned above, a freelancer is a great option for certain tasks and specific activities.
  • You can easily find freelancers for everything on Upwork, Elance, Hub staff Talent, Guru, etc. Once you find them and both sides agree to the terms, they can start working.

It sounds great! Why don’t everybody hire a freelancer?

  • One freelancer probably will not be able to do a complete project. If someone tells you that he is good at UI/UX design, software quality assurance, software development, programming mobile apps, etc, you can bet that he is not doing some of those tasks well.   
  • After completing a project they can decide to leave the project. So they don’t provide further maintenance. If bugs appear, you will need to hire other people to fix it.
  • Because of the big demand, not all freelancers are working to get returning clients. Your product’s quality or company success is not always their priority.
  • Freelancers are lacking soft skills. They might be excellent at their (technical) work but normally can’t plan and organize their own work process.

The main difference between software companies and freelancing is the team of professionals. A software company should have professionals in all aspects of a certain discipline. For example, you will no longer depend on outsourcing to a programmer who only knows backend, now you will have a mobile and design team to carry out complete projects.

Hiring a software development company is the best choice if you have a long-term project and you need professional work and working relationships, quality products and security.

The software development companies have all kind of experts (project managers, software/web developers, UI/UX designers, business analysists, QA Engineers, SEO experts) to ensure full-cycle of services.

They work with agile methodology and the whole development process is divided into sprints/iterations which is great for supervision and possible amendments.

Pros of Software Development Company

  • As we already mentioned above it provides all kinds of services, including consulting. Besides development, these people can tell you which technologies and solutions would be better for your project. If you have a startup they can help you with the monetization strategy. With a software development company, you get a think-tank full of ideas. Their teams are hand-picked and consist of professionals. It’s a full package!
  • A software development company cares about the results and the reputation, so we can assure you that there is a coordinated work, well-tuned development workflow and has more chances to meet deadlines. Also, you can communicate with the team that is available, open and responsible, you can make changes, but you won’t need to care about minor issues because the company provides a project manager or team leader that would handle them.  
  • Experience! Software development companies have worked on many projects and have different developers with experience for different technologies, frameworks, libraries, etc.
  • A software development company strives to develop high-quality products in order to get positive feedback after the launching and tends to build a relationship of trust with the clients.
  • When we talk about long term relationships we also mean constant maintenance of the current products, changes, new features, updates, bug fixes.
  • As business entities, software development companies offer and guarantee stability, reliability and less risk. They usually have a lawyer who prepares contracts and other documents to start the project.




  • Software development companies have expert developers who cost much more than freelancers. It’s inevitable to have a higher cost, especially if your project team consist of more developers, QA engineer, designer, etc.
  • There is a big rate difference among software development companies depending on the region. In India there is a low-cost offer of the development services, meanwhile, in the US and Western Europe, it can cost you a fortune. But Eastern Europe has an evolving IT industry with experienced and skilled developers for mid-price. This big difference sometimes can be confusing, so make sure you get the quality you need - the cheapest offer is not always the best one.

Summing up, as we already mentioned, freelancers are cheaper and a good option for a short-term and specific task, but as they work on multiple projects, sometimes can be less predictable and it can cost you more.
If you need a complex, sophisticated enterprise solution with a lot of functionalities you should appeal to a software development company. It can be pricey but it ensures the highest quality end-product, and it saves a lot of time and effort.

Finally, the most important thing is to find a contractor who can meet your needs, never decide on cost alone, and make sure to protect your intellectual property and legal concerns.

on April 12, 2019