For many of us who use Leanlab.io to record and develop startup ideas, and for any software startup, selecting a full-stack developer or a development agency to bring your idea to life is one of the most important decisions you will make for your business.

If you, and or your partners are not designers, developers, or software engineers yourselves and you need to hire a full-stack / strategic software development company to get your idea off the ground, do this:

• Do your research

• Do more research

• Choose wisely

Where To Start?

There is a massive variety of web and mobile app developers around the world. New development agencies pop up everyday. Still, many others close down and some disappear and assume new business names. Do your research in your home market and especially, for off shore developers.

Check Independent Reviews

Look through independent web sites that rank developers. Read reviews and client testimonials about the developers. Customer reviews are the most valuable insight into a developer’s results, and will give you a clear picture of your candidate’s abilities and quality of service.

For less expensive off shore companies and less established developers who are not featured in independent review sites, take a good long look at projects they have completed and the work that they have done recently. Download some of those applications and try them out. This is a major indicator on the potential quality of your app’s design and functionality.

Get Referrals

Also, talk directly to at least 3 of your developer candidates’ current and previous clients. Get a good feel for the quality, speed and responsiveness of their design and development program. Try to identify any language barriers or time-zone challenges that are prevalent with existing clients. If the developer candidate does not offer referrals that you can speak with directly- that is a big, red flag. Run. Run far away.

Narrow it Down

After your decide on 3-4 off shore developers, there are a number of formalized questions you need to ask them about how they approach their work, which type of workflow methodology they use, how often will you meet with them, the depth, experience, location, and breadth, of their development team, etc..

These and many other questions formulate the RfI / RfP process. We will cover many of these questions in another article. Today, we will cover decision making around price.

Never Hire A Developer Solely on Price!

Don’t be entirely enamored by a cheap quote to develop your application. A proper RfP, and due diligence on the developers is always very key. Pricing is important, but it should never be the sole factor when choosing a developer.

You know the old saying: ‘you get what you pay for’. If you are developing an app or a responsive web portal (or both); you should well know that you and your company’s brand, reputation and ultimate success will depend not only how well your idea solves a real problem, but how well the application works.

Your application is the face to your customers. Unless you are creating a stick figure app with 2-3 screens, first focus on the best quality agency you think you can afford. Then, turn your focus on navigating the overall cost. Give up on some features for a better quality start. Customers are fickle, they don’t usually come back if they get turned-off right away by a poor quality application.

What’s This Going To Cost?

Your application cost will depend on a number of factors.  How many different screens is your application going to have? Will your application be mobile? Will it be native (customized) to Google Play and the App Store or not? How responsive, or how much bespoke programming must be done ? These and many other aspects will affect the overall cost of your project.

The other major factor that affects pricing is the disparity in fees that are charged from one developer to another for the same project. This fee gap is wide enough to drive a truck through.

The are three known causes for the massive price disparity in development projects:

1) Location: Since design and coding can be done absolutely anywhere, the location and subsequent labor costs of the development teams will drive the fees associated to the project. For example, development companies with employees that are mostly located in the U.S. can be about 2x more expensive than a respectable development agency who’s staff is mainly located in say, India for example.

2) Reputation: Newer, less known development agencies try hard to gain business by charging very low flat or per/hour fees to undercut incumbents, but often the quality can be very poor. On the other hand, the more established agencies in developed countries (like the U.S.) with strong customer reviews - often demand higher than average fees, as many pivot from B2C to B2B services and market higher end projects.

3) Lack of Regulation: Web and app development service is essentially an unregulated business, globally. There are no systemic rules governing how much someone can be charged for work done; and no third party governs global standards of application development for work produced. Work contracts are only as good as those who are willing to honor them.

Yes, there are ratings and reviews that guide you, and market /competitive forces that somewhat balance pricing per country. However, unlike in the financial services industry, there isn’t a formal institutional code of ethics or governing body that regulate pricing or quality of the services, especially in cross-border relationships.

The quality of work performed is a matter of interpretation. If a developer did what you asked, but you don’t like the result (and don’t want to pay more to fix it), there isn’t a self-regulating organization that can help you sort it out. You can seek remedy through obscure cross-borer legal routes. Good luck.

This is why cross-bordering / off-shoring your full-stack development project is very much a risk / reward scenario.

Going With an Off Shore Developer?

So, you have decided on a few developers to build your startup application, but choosing an established player in the say, the U.S. is completely outside your price range. You have decided to choose a firm that employs developers mainly well outside your physical reach. You are going ‘off shore’ to get the right mix of development quality and costs that’s within your price range.

There is no problem with that. There are plenty of well established, reputable off shore development agencies to choose from. If you go this route, we do recommend using this one rule:

Use ‘The Shoulder Rule’

As we mentioned earlier, your company’s success will be highly dependent upon the quality of work that is produced by your developers. No matter how air tight you think your business plan is, or your executed statement of work is, or your service level agreement is, not everything will go as planned with development.

A consistent, dynamic and reciprocal communication channel with your developer agency is critical. When things go off-track (and they will), it’s very important to have the ability to meet with someone at the agency face to face. There is naturally a much higher level of accountability by any developer if they know a customer can be physically present to tap them on the shoulder.

We suggest that it takes no more than 3 hours for you to travel and be able to meet with your developer agency - face to face.

Three hours should be as long as it takes for you to travel and be physically able to ‘tap the shoulder’ of a representative of significance at the development agency. A representative of significance would include someone as a relationship manager, a senior program manager, CIO, or other influential figure. It does not include meeting with an answering service or an office manager assigned to taking care of a post office address.

Ask any off shore developer candidate if they have an office or a representative in your region that you could occasionally meet with. Don’t be fooled by offices that are ‘in name’ only. Many less legitimate companies maintain fake or local ‘shell’ addresses in attempt to give you a false sense of comfort. If they have no presence anywhere near you, or if their responses on location accessibility are not clear, run. Run far away,

There are enough off shore developers at reasonable prices that have representatives in major developed cities. You will likely pay a bit more for an off shore developer with some minor local presence, than hiring an agency that has absolutely no footprint in your 3 hour radius. It’s worth the investment.

Again, if your startup has an experienced technology team and only need remote specialists to fill in some development, coding gaps - and you can ring fence their work, that’s a different story.

If you are seeking a full-service development agency, heed caution. When assessing your off shore developer cost and risk / reward scenarios, don’t ignore the possibility of key-man turnover and entire company flight risks.

Too much is riding on the success of your application and too much can get away from you if you avoid the ‘shoulder rule’.