How to Hire the Best Product Development Firm for Your Software Project

Outsourced product development firms play an important role in today's economy by delivering new products and services for clients who otherwise would have to build in-house, which for many companies is not their core competency.

With future of work trends, high demand for tech talent, and the shift to product-first companies, the landscape of these third-party firms is rapidly evolving. In a recent study, three quarters of executives planned to increase their use of independent professionals to provide expertise either to supplement full-time talent, or to access skills and experiences they lack in their workforce.

Design firms, dev shops, agencies, freelancers, and a new category of ‘silicon valley’-style product teams-for-hire are all battling it out for the same software projects — making it difficult to know which one is the best choice for your project. If you're not careful, it could take months to discover you made the wrong decision and certainly not before your project misses the mark.

In this post we'll explore four main types of providers in the product development space so you can select the best option for your project.

Product teams-for-hire

What do product teams-for-hire do?

Silicon Valley Product Group defines a product team as cross-functional (product, design and engineering); focused on and measured by outcomes (rather than output); and empowered to figure out the best way to solve the problems they’ve been asked to solve.

Product teams-for-hire are dynamic teams with extensive experience in software development. While these firms offer the same design and development services that other outsourced firms do, they usually act as an extension to your in-house team.

Product teams-for-hire will:

  • Use lean product processes to help you deliver a minimum viable product
  • Deploy nimble, cross-functional teams to define, design, and deliver software projects
  • Help you prioritize your roadmap and accelerate delivery of product initiatives

Example product teams-for-hire

  • Gigster: helps more companies expand their ability to innovate by building dynamic teams made up of top global talent that create industry-changing custom software.
  • Mision: provides B2B SaaS companies with a comprehensive product outsourcing solution so that they can quickly and cost effectively take new products from concept to deployment and beyond without the time and expense of hiring additional staff.

When should I go with a product team-for-hire?

If you are early stage these firms can help you achieve your next important milestone while not bankrupting the company. Choose product teams-for-hire if you need to move fast and like the dependability of experienced software product teams.

Design Firms

What do they do?

Design firms specialize in brand, product and service design. Their services typically include user research, user experience design, user interface design, brand design, and brand strategy to name a few.

Design firms aim to:

  • Create the best user experiences — products that are intuitive, easy and enjoyable to use.
  • Differentiate your product or service in the market through design.
  • Solve end-user problems in the most user-friendly manner possible.

Example design firms:

  • Metalab: helped some of the world’s top companies design, build, and ship amazing products and services.
  • Fresh Tilled Soil: create user experiences to make your company grow.
  • Ideo: a global design company committed to creating positive impact.

When should I go with a design firm?

Choose a design firm if you are strong in other areas like engineering and sales. For example, Slack hired Metalab to design their interface.  

Custom Software Development Shops

What do Dev Shops do?

Custom software development firms design, create, deploy and maintain software for a specific set of users, functions or organizations. They are usually engineering-centric and focus on requirements gathering, code construction, testing and deployment.

Services from a dev shop might include Web & API Development, Third-Party Integrations, Workflow Automation, Security & Compliance, Performance & Scalability.

Dev shops will:

  • Work with your ideas and plans to deliver web and mobile applications for your customers.
  • Modernize your technology for better scale and faster development cycles.
  • Focus mostly on the execution side of things and leave the feature definition to you.

Example dev shops

  • Pivotal Labs: Will work side by side with your team to build capabilities and instill a process that shows immediate and lasting impact.
  • Thoughtworks: a global software consultancy solving complex problems with technology.
  • NYC Dev Shop: a top rated app development agency passionate about building web and mobile applications that work, make sense, and help people.

When should I go with a dev shop?

Choose a dev shop if you have the following areas covered: subject market expertise, product management and product design. Just make sure you set expectations up front for how the different teams will work together to ensure smooth transitions and collaboration. Also, it is important to have a strong internal dev lead or point person to interface with the dev shop.

Digital Product Agencies

What do Digital Product Agencies do?

A combination of design and dev shops, digital product agencies help clients build digital products from soup to nuts and then bring them to market. They offer a wide array of services including design research, design sprints, brand strategy, user experience design, engineering talent, web design and development, and growth marketing and analytics. They typically work with larger companies who have big budgets.

Digital product agencies will:

  • Provide strategic direction, creative design, and technical development for software and hardware projects.
  • Guide you and help your business to grow with specific digital products to specific target audiences. Can have multiple industry experts for different tasks.
  • Give you technical expertise, agility, and scale.

Example digital product agencies

  • Thoughtbot: Expert design and development partner.
  • Work & Co: Designs and develops digital products for the world's most respected brands.
  • Emerge: executes digital product transformation for technology companies seeking to improve operational agility and customer experience.
  • Appnovation: help businesses advance and inspire, create positive transformation, and champion digital innovation.

When should I go with a digital product agency?

If you’re a larger company with a big budget and have no in-house expertise in designing, developing, and marketing software, you should consider a digital product agency.