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Developer, freelancer or agency? Who should build your startup's first product

There's an idea and a budget. Now the hardest question: who will build the product? A technical co-founder, an employee, a freelancer or an agency? Each has its place and its risk.

Nail Seyidov
Founder of NS Studio · 4 min read
Developer, freelancer or agency? Who should build your startup's first product

Photo: Jud Mackrill / Unsplash

First, a confession: I'm an agency founder. So in this post I'll take extra care to stay neutral, because not every startup needs an agency. Sometimes the right answer is “nobody yet — test it yourself first”.

Let's go through the options one by one.

1. A technical co-founder

Someone who owns the company together with you and is responsible for the technical side of the product.

  • Strength: long-term commitment. They take equity instead of a salary, think about the product with you and don't run when times get hard.
  • Risk: the right person is hard to find, splitting equity is complicated, and a mismatch between partners can paralyse the company.
  • Who it suits: startups where the product itself is the technology — where your competitive edge lies in the technology.

In “Let's build an IT startup, bro” I described how the “we'll give the developer a cut” approach ends: a co-founder isn't an employee but a partner, and you have to do as much work as they do.

2. A hired developer

  • Strength: full focus, the knowledge stays inside the company, the product moves forward every day.
  • Risk: one person doesn't know everything. Backend, mobile, interface, servers and testing are separate skills. Add hiring, management and a salary every month.
  • Who it suits: when the product already works, has users and needs continuous development.

3. A freelancer

  • Strength: flexible and cost-effective for small jobs. A specific task, a specific result.
  • Risk: dependence on one person, availability (they work on other projects at the same time), uneven quality.
  • Who it suits: small jobs with a clear scope, and prototypes.

4. An agency

  • Strength: a ready team — analyst, designer, developers, testing. A process, and responsibility for dates and results. When someone falls ill, the work doesn't stop.
  • Risk: it costs more, you're not their only client, and the product knowledge may stay inside their team — that is, outside your company.
  • Who it suits: a first version with a clear scope, when speed matters and there's no in-house team.

5. Yourself

Yes, yourself. No-code tools, a landing page, a form, a Telegram bot — these are often enough to test an idea. I wrote about this in detail in “MVP: how to build a first version that fits into 6 weeks”.

  • Strength: the cheapest and fastest test.
  • Risk: limitations. When the product grows, you'll have to move to another solution.

Which one, and when?

  • The idea hasn't been tested yet → yourself, or a simple prototype with a freelancer.
  • The assumption is confirmed and you need a first real version → an agency or a strong freelancer, with an independent technical adviser alongside.
  • The product works and is growing → an in-house team, a tech lead, and when the time comes, a CTO at co-founder level.

Whoever you choose: 5 rules

  1. Keep the accounts in your name. The domain, hosting, App Store and Google Play accounts, the code repository — all in the company's name.
  2. Pay in stages. A working result at the end of each stage, then the payment.
  3. Written scope and acceptance criteria. Write down in advance what “done” means.
  4. Documentation. Another team should be able to pick up the work tomorrow.
  5. Start with a small trial task. A week or two of work before a big contract will show how you work together.

The bottom line

The right choice depends not on who is better but on what stage you're at. Hiring a big team for an untested idea is just as risky as leaving a working product to one person's goodwill.

If you're not sure which road suits you, let's look at your situation together in a mentorship session — even if the answer isn't an agency.

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