How to Hire a Dedicated Development Team in 2023: A Step-by-Step Guide

Are you a startup founder, head of product delivery, or head of human resources looking to hire a dedicated development team?

If yes, kindly read through this article to learn the following.

• What is a dedicated development team?
• Why you should consider hiring a dedicated development team?
• The structure of an ideal dedicated development team,
• Cost of hiring a dedicated development team,
• Steps to hiring a dedicated development team,
• And more!

If you prefer visual to text, then go straight to the bonus infographic “How to hire a dedicated development team?”

Looks like what you’re willing to learn? Let’s dive into the crux of the article.

What is a Dedicated Development Team?

A dedicated development team is an outsourcing concept involving hiring a workforce of software engineers and other supporting professionals to build and manage software. This business model is one that many tech companies use, and numerous researches have shown that.

An example of such research is a Statista report depicting that IT services offshore amounted to $62 billion in 2018.

Another survey by Statistics Brain shows that 44% of companies in the US use offshore dedicated software development to cut costs.

By partnering with a dedicated development team like a startup, you’re hiring experts to fill a workforce demand in your organization.

Even though this method is as effective as an in-house workforce, it exempts you from the liability of catering to some management expenses. With this, you can focus more on your startup’s business needs while the dedicated team assists you with technical requirements.

Now that you have a concise understanding of this outsourcing model, let’s discuss why it’s the best.

Why you Should Consider Hiring a Dedicated Development Team

A dedicated team model offers startups a cost-effective way to handle complex and long-term projects. It’s the best hiring option for startups and founders that lack clarity on a product and needs a discovery stage.

Let’s further discuss this model in detail.

Hiring Reason 1. Lack of Expertise

23% of startups fail due to a lack of expertise. By outsourcing your software creation, you can easily leverage the software development agency’s network of talents to fill a knowledge gap in your startup.

Let’s assume you want to inculcate a cryptocurrency payment platform in your FinTech product.

Such innovation requires a blockchain engineer fluent in a Solidity programming language that your startup will most likely lack.

Most software dedicated development teams have a blockchain developer in-house or on call. Thus, you’ve filled the knowledge gap without undertaking a cumbersome hiring process by hiring one.

Hiring Reason 2. Access to a Larger Pool of Talent

If you have a workforce deficiency in your in-house team, opting for a dedicated team model offers a great way out.

This option helps open your startup to a pool of professionals across the globe, allowing you to choose the best talent at a reasonable price.

Examples of well-known technology companies that have enjoyed this benefit include Google, IBM, and Microsoft.

Hiring Reason 3. Faster Scalability and Flexibility

If you’re looking for top-notch flexibility, then this is a guaranteed outsourcing option for you.

It allows you to focus squarely on the business aspect of your startup while also having an oversight of the developmental process.

More so, you easily scale your workforce according to your needs without going through the tiresome process of hiring developers.

You can make requisite labor modifications by simply adjusting the terms and conditions of your contract with the vendor.

Hiring Reason 4. Cost Saving

Hiring a remote team is a cost-efficient option for startups domiciled in the US, the UK, Canada, and other high-income nations. This is because the cost of employing developers varies with location.

As shown in this article, the cost of hiring a UK-based app developer is $100-$120 an hour. The US-based software developer is even pricier as it costs $100-$150 an hour to hire one.

However, assembling a dedicated development team in Ukraine will only cost you $30-$50, helping you save $100 an hour.

Now willing to hire a dedicated development team? You shouldn’t do that yet. There are some things to sort out before initiating a partnership process.

What to Know Before You Hire a Dedicated Development Team

Before you sign the partnership agreement, it’s important to define what you plan to build, your deliverables, and milestones. Let’s elucidate more on these:

1. Define What you Plan to Build

No matter how simple or complex your solution is, you need to give the development team a detailed explanation of what you want to create. Whether it’s a web app, a WordPress website, or a mobile app.

This is especially important because the type of product you’re building determines its technology stack and the kind of team to work with. Consequently, if you’d like to develop a mobile app, you need to consider hiring a team of dedicated mobile app developers.

Here are some examples of app types and corresponding suitable tech stacks.

2. Define Your Expectation

Ensure you properly communicate your expected deliverables to your team. Do you need a reliable technical partner, industry expert, or an all-around workforce for varying projects?

Each of these options requires distinct levels of engagement, management, and deliverables. Your expectation will also guide your ideal deliverable.

3. Define your Budget and Deadlines

To be successful with your product development, it’s imperative to come up with a definite budget and an agreeable timeline.

Unless you have an unlimited budget – which is very unlikely for a startup, you should hold a series of meetings with the team’s project manager and business analyst.

During the meeting, discuss common features and functionalities, regulatory framework, and mode of communication.

After the meeting, you should have a list of agreed expenses and milestones. This will, in turn, be used as a template to compute your budget and set a deadline for project completion.

Once you’ve agreed on the above information, the next thing is to assemble your dedicated software development team. Let’s discuss the constituents of an ideal workforce.

What is the Typical Structure of a Dedicated Product Development Team

Your developers depend on your technical requirement. For an application development project, an ideal app needs the services of the following:

• Project manager or product manager
• Business analyst
• Tech lead
• UX/UI designer
• Front end developer or mobile developer
• Back end developer
• DevOps engineer
• Quality assurance tester

Let’s discuss the meaning of each role.

Now that you have an apt understanding of team members to onboard, let’s on the types of software dedicated teams out there.

What Types of Software Development Teams are There?

There are three common software development team structure types: dedicated, team extension, and project-based team. Each can be efficient in one product and ineffective in another.

Consider your project’s budget, time, and complexity, and then decide the most convenient structure to prevent the latter.

To help you understand what your options entail, we’ll dive into more details of different types of dedicated development team models. You can group your outsourced workforce on a partnership and location basis.

Type 1. By Partnership

Based on your partnership agreement with your outsourced team, you can get three models of hiring development partners. These are:

Model 1. Dedicated Development Team

A dedicated development team is a group of remote experts who help design, develop and maintain the software. This team works full-time and accordingly to your management methodology just like your in-house team, but with an office in another country.

The delivery plan is defined accordingly to the product development roadmap. A tech vendor compiles and manages the team to work exclusively to achieve your business goal.

The model of outsourcing is best suited for:

• Startups that have raised an investment round and are aiming to capture the market quickly
• Startups that want to embark on a long-term continuous project
• Startups that lack the time/resource to set up an in-house workforce
• Startups or scale-ups whose in-house developers lack the requisite skills to build certain functionalities.

If your startup fits any of the three criteria above, then a dedicated team is your best bet for success.

Model 2. Hiring Resources to Expand the Team

The crux of this model entails adding needed expertise from a vendor to your in-house development team. Thus ensuring sensitive functionalities are embedded in the solution within your internal ecosystem.

This model of development outsourcing centers around time and materials contracts.

For example, if you require the expertise of a frontend developer with knowledge of a Javascript library that’s not in your internal workforce. Then it’s best to opt for an out staff.

This model helps your startup reduce ingesting, payroll, and project management costs.

You’ll have an overview of your team’s productivity and better determine its deliverables. Additionally, it lessens the task of recruiting and allows you to concentrate more on the core business and development process.

Model 3. Hiring Resources on a Project Basis

As opposed to hiring a dedicated team, this involves a single contract hiring a team of developers to work on a specific software functionality within a product. What do we mean?

Let’s say you plan to build an investment app. It consists of varying features: authentication, API integration, payment features, and so on. While your in-house team may build the backend and API integrations, you may hire a team to help with front-end development.

This model is ideal for startups in need of:

• Time-saving solution
• Cost-efficient solution
• A resource and skill-demanding project.

Now that you’re acquainted with classification by partnership type, let’s also discuss classification by location.

Type 2. By Team Type

Startups have the option of hiring four types of software development teams. Each team type has its peculiarity, advantages, and demerits.

To have an apt understanding of what each entails, let’s elucidate all four options:

Model 1. In-House Development Team

A dedicated in-house development team means that you have a pool of developers broken into teams, where each team handles a separate project.

Here, every worker is employed, managed, and remunerated directly by the startup.

This hiring model gives startups full control over the development process and allows regular communication between the management and the workforce.

Although it’s the most common team management model, it has many cons to consider. Let’s consider the pros and cons of this method.

If this option suits your business, then ensure that you have the mature management process to coordinate their activity. But before zeroing in on this option, you should check out other options below.

Model 2. Local Development Agency

If you want an external team within your country with development processes outside the confines of your startup, then this option is best suited to achieve that goal.

This option describes the United States-based startup outsourcing some or all of its development projects to the USA-based app development agency.

Model 3. Freelance Developers

Freelance developers are independent software engineers that help build software products on a project basis. Their loyalty is not pledged to any startup and is only available to create, fix, or maintain a product.

You can easily source freelance developers online, through freelance platforms and social media sites, or by one-on-one recommendation. They’re ideal for ASAP, short-term, irregular tasks.

Note: Sign an NDA with your freelancer as they might leak user information to competitors for the right price.

Model 4. Offshore Outsourcing Agency

A dedicated development team provided by an offshore development agency is the most profitable, flexible and high-quality option.

This method is most prominent in high-income countries. It’s a popular trend in Germany, the US, the UK, and other technologically advanced nations.

Now that you have a good understanding of the classification and types of software teams. Let’s discuss what it’ll cost you to hire one.

How Much Does Hiring a Dedicated Team Cost?

The development cost of a dedicated team varies from $6000 to $12,000 monthly.

However, the exact cost is dependent on a wide range of factors. Those factors include the team’s location, the product being developed, and the skill set needed.

To help educate you on the potential cost of hiring a team, we’ll elucidate on outsourcing costs in different locations.

The calculation case is that you’re building web and mobile applications with help of a 7 people team in 5 months.

As seen above, partnering with an outsourcing company domiciled in a high-income country costs more than outsourcing to one domiciled in a middle-income one.

Thus it’s safe to say the country of location is a cost influencing factor to consider.

Note: In your quest to find cheap alternatives, avoid outsourcing to a ridiculously cheap software development company as they’ll only result in shabbily built products.

Now that you know the cost implication of outsourcing your software product. Let’s discuss the steps to outsourcing to a quality team.

3 Steps to Hiring a Dedicated Software Development Team

Hiring experienced developers requires understanding what to look for and appropriately vetting each option’s talent pool.

The three steps in choosing a great outsourcing partner are:

• Finding a team developer online or offline
• Appropriately vetting each option to ensure conformity with project requirement
• Carry out third-party verification.

Let’s provide you with some vital information that can help you achieve those steps.

Where Can You Find a Dedicated Team?

You can find dedicated teams both online and offline.

By online, we mean through freelance websites and social media engines. For offline search, you should ask friends with experience in this sector or attend tech startup conferences.

Below is a spreadsheet of where founders have successfully found skilled software engineers.

Beyond knowing where to hire dedicated developers, you should also know the qualities to look out for in a qualified team. Let’s discuss how to choose the best for your project.

How to Choose the Best Fit Dedicated Team?

Choosing the best-fit developers from your options can be difficult.

Irrespective of their claims, you’ll have to extensively research, validate their claims, and establish a communication model.

Below is a detailed exposé of how to make an apt choice.

Step 1. Carry out an Independent Research

The best team isn’t one that presents itself best. It should be one you’ve duly investigated and identified their capacity to deliver your project requirements.

Research about the company’s pedigree on specialized platforms like Good Firms or Clutch.

In your research phase, it’s best to check for the following:

• Location
• Hourly rate
• Reviews
• Level of expertise
• Project portfolio
• General info

An easily overlooked but vital factor to consider is company growth. Quite often, good service providers enjoy rapid growth.

Thus, if their staff strength increases quickly, then it means that their development and scaling rapidly.

Generally, Ukrainian software development companies tend to fit best in this criteria. This is according to research that shows that such companies have grown 2.5 times larger in the last five years.

Step 2. Communicate with Future Team

The chances are high that you’ll have a long list of developers. However, you’ll need to settle for one with a good communication strategy.

And when you finally settle with a remote team, arrange a call with them, and discuss things in person. Appropriately express your ideas about the project, its specific requirements, and your project goals.

Discuss timelines, time zone differences, and schedule an engagement model to understand the team’s modus operandi.

Excellent communication ensures that you’re on the same page as your team, and it guarantees an effective workflow, which in turn leads to high user satisfaction.

Step 3. Validate the Information

Although optional, hiring an expert to validate requisite information about your chosen vendor may be iterative before agreeing to a contract.

While this option seems extremely thorough, you need to proceed with extreme caution as some experts cunningly trick clients into patronizing their services instead of your preferred team.

So you can either ask for the client’s contacts from your country or hire a consultant to conduct a technical interview.

What to Know Before You Hire a Dedicated Team

Now that you’ve identified a preferred software development agency to partner with, you should draft a mutually beneficial contract and sign a non-disclosure agreement.

Let’s dig more into what this entails.

Sign a Non Disclosure Agreement

For longevity in the tech sector, it’s imperative to have a policy that guarantees your intellectual property gets much-needed protection.

A signed NDA helps to keep your technology private when your competitor is partnering with the outsourcing company as it relates to outsourcing.

Keep in mind vendors may further outsource functionalities that require rare skills, so be sure that the NDA is well crafted to cover all parties involved in development.

Get a Detailed and Transparent Contract

The contract you sign must spell out the following:

• Hourly rate with a detailed breakdown of estimated timeframe if it’s a project-based contract
• Potential discounts
• Invoicing and payment protocols
• Credit periods and limits
• Warranty timeframes and conditions.

Ready to Hire a Dedicated Development Team?

Nowadays, finding skillful developers can be challenging for startups. However, with the help of a dedicated development team, the hiring process may be seamless.

Get started on your tech project by hiring the best-dedicated developers with us.

Bonus Infographic

Here is a summary of our detailed guide. Learn about the basic steps to hiring a dedicated development team and what you need to know before hiring a dedicated development team.