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Your company’s got ambitious goals for growth, and an aggressive software development roadmap to help achieve them. But with budgets still tight and adding to headcount not an option, you’ve decided to hire an outside software development agency to support you. Now comes the risky part. Finding the right software development company can free your team up to focus on other priorities, but making the wrong choice can put you in a hole that can take a year or more to climb out of.

So how do you make the best choice, especially in a world where the majority of software development projects <a href="https://www.cio.com/article/230427/why-it-projects-still-fail.html">fail to accomplish their goals</a>? In this guide we cover the things you need to know before you begin, a list of things to look for in your next software development partner, a list of warning signs, and a free scorecard to help you evaluate your options.

Success starts with planning, and a successful decision is no different. Before you even start researching software development agencies you’ll want to have all the information you need to make an informed decision. Here are the key things to focus on before you get started.

As with any software development project, defining your scope is a critical first step. If your project is an MVP of your new platform, having conviction on what minimal (the ‘M’ in MVP) means is an early indication of a successful project. Here are a couple of tips to help:

Most time (and, by extension, money) that goes into software development isn’t spent writing code. It’s in communication: status updates, meetings to gain consensus or come to decisions, reviewing and adjusting the roadmap, etc. Heading into a selection process for a software development partner, you’ll want to consider how their staff and workflow will fit into your process. Almost every software development agency will have a process that they prefer to follow, so the more overlap between your processes and theirs, or the more flexibility you have to work within their processes, the faster development should proceed. You just need to come in with an understanding of the things you need from your side. A few things to consider:

Where to look for software development agencies

If you’ve got a LinkedIn profile that even hints that you might be in charge of selecting a software development company there’s a pretty good chance you’ve got a few dozen unsolicited emails from companies already in your spam folder. You should ignore them in favor of your own research. Companies that rely heavily on cold outbound email or LinkedIn are playing a numbers game, and are sending lots of messages out without considering your specific needs. If they’re a good fit, your research will turn them up.

<b>The best way to find a software development agency that’s a great fit for your project is to post a <a href="https://tinyrfp.com">TinyRFP</a>!</b> A TinyRFP gives you just the right amount of process around your selection. You post a few sentences about your project and your unique requirements, and you’ll get proposals from high-quality agencies that you can evaluate to make sure you’re getting the best partner.

If that’s not an option, or if you want to kickstart your selection process, you can turn to your network. Reach out to other leaders in your company, to your investors or advisors if you have them, or to peer networking groups. If those don’t turn up anyone, or even if they turn up one or two options, you’ll still want to continue looking.

If you still need to broaden your search you can use a provider directory like <a href="https://clutch.co">Clutch</a>. Clutch has a fairly extensive list of software development companies broken out by size, specialty, average project budget, and location. You can spend a few hours looking through their site to come up with a shortlist. <a href="https://startup-recipes.innovationworks.org/recipes/hiring-a-development-firm-with-clutch">This guide</a> has more information on how to do that. The thing you’ll want to keep in mind however is that the information on Clutch is self-reported, and you need to be wary of companies using fake reviews to improve their profile.

What to look for in a software development company

You’ve got your needs, processes, and budget defined, and now you’re ready to find a provider for your project. Even if you have a warm referral from someone you trust, you’ll want to give yourself a few options. But how do you decide which provider to choose? Read to the end for a free scoring template you can use, but here are a few key indicators of a good potential fit.

They have previous experience with clients and projects like you

The best predictor of future success is past success. The hard part, of course, is judging success. When you put a provider on your shortlist, ask them for these types of references:

For smaller projects it can be possible to get scope and budget locked in before work begins, but for larger projects it can be better to separate the project into phases that can be scoped and estimated separately. It also means you aren’t locked into a large contract, and you have more flexibility to adjust scope as you go, or even change providers if it turns out things don’t work out. If the provider proposes a phased approach that’s a positive sign.

Yes, you’re hiring them for their ability to build the software you envision, but a provider that brings value beyond just the code they ship is a sign of a great potential partner. Here are some ways the right software development agency can provide value outside of lines of code:

Although it’s difficult to assess these before actually working with an agency, if you are conducting reference calls (which for larger projects, you should be), asking about cases where the agency has provided value over code and looking for these types of cases can be a good indicator.

It’s important to start with the end in mind. Your team will ultimately be the one who owns the code and work product they deliver, so you need to consider how it will integrate into your existing workflow.

Do you have existing review / sign-off processes, and will your partner’s work need to undergo them?  How will they account for that in their workflows and timelines?  Will they be using your issue tracker or their own for managing features and bug reports, and what access will you each have to one another’s work tracking tools?  If your company uses a Continuous Integration/Continuous Deployment (CI/CD) process, how will their work integrate with it? Who will be the point person on your team for communication with the partner, and what responsibilities, authority, or need for updates will other stakeholders on your team have?

These processes are worth specifying before work begins, even if they’re not directly included in the scope of work.

They use well-documented change management procedures

In software, like in every other part of life, change is the only constant. As thoroughly as you might have considered your requirements before starting the project, something is certain to come up. Make sure that the agency you select has a documented change management process for changes in scope or requirements. Since scope changes often include cost changes, you’ll want this process included in the Statement of Work for the project. You’ll also want to reserve some portion of your budget to account for scope changes during implementation. And as part of contract discussions you’ll want to have an understanding of how you’ll handle cases where the project risks going over time/budget constraints even for the agreed-upon scope.

Software development agency warning signs

As hard as it can be to feel confident you’ve picked the right company for your software development project, picking the wrong one can be more disastrous. So it’s good to have some ways to quickly disqualify agencies that aren’t likely to be a good fit. Here are a few warning signs to look out for:

Outside of the positives and negatives there are a couple of wildcard factors you should consider when selecting a software development company for your project. Since this is a work for hire, you need to make sure that you have the rights to the work they develop, which seems straightforward on the surface, but can become a crisis if they’re not handled properly.

Not even on most peoples’ radars a year ago, every software development contract now needs to consider the impact of AI on the work product, AI functionality is now built into most popular software development tools, and developers who’ve incorporated these tools into their workflow effectively can be extremely productive, potentially saving you a lot of time and money on your project. But it’s not all upside. There are legal questions about the ability to <a href="https://www.bloomberglaw.com/external/document/X4H9CFB4000000/copyrights-professional-perspective-ip-issues-with-ai-code-gener">copyright AI-generated source code</a>, which means you might not be able to protect the work product delivered by the agency. As with most emerging issues, there’s no easy answer here. Prohibiting agencies from using AI-generated code isn’t necessarily the best answer either. Just make sure your company’s leadership and counsel are in alignment on what you’re comfortable with, and communicate this position to the agency you select.

As with any work product it’s common for agencies to include a warranty on their work. It’s common for a Statement of Work to include some period after project completion where the agency will fix any error you find if you report it to them. Anywhere from 30 to 90 days is most common. This is one of the most common scenarios where the relationship between company and the development agency they partnered with goes south. After delivery, the company finds some issue that they believe is a missed requirement. They go back to the agency with a warranty claim, but the agency feels it’s a change in scope because the requirement was either not communicated, or not communicated well.

You'll want to have documentation that indicates you own the source code as part of the delivery. This is important enough to make sure it’s part of any Statement of Work or Master Services Agreement that you sign with the provider. One thing to note here is that software development agencies often over time develop their own reusable libraries that implement specific functionality that comes up in multiple projects, and the contract will often specify that the development agency retains ownership of these libraries. This is actually a good thing! It shows that the agency is factoring in re-usability in their strategy. It means you won’t be paying for them to re-implement something they already have a solution for, and should save you time and money. As long as the contract also grants you a permanent royalty-free, irrevocable license to use these libraries, this is all the coverage you need.

As this article has made clear, there are a <i>lot</i> of things to consider when selecting a software development company for your project. To help you with your selection process, we’ve put together a <a href="https://docs.google.com/spreadsheets/d/1iljrsAowxa1m1nJEa9QnsTK402Vx5l_48PdlLXs0_bg/edit?usp=sharing">handy scorecard</a> for you to use. It pairs nicely with using <a href="https://tinyrfp.com">TinyRFP</a> to manage your selection process. As you add agencies to your shortlist and conduct diligence, use this scorecard to help you rank respondents and stick to a methodology for your selection process rather than trust your gut.

How to choose the right company for your software development project [+ free scoring template]

When you’re a leader in a growing company and facing a decision on how to hire a provider for a strategic project, you’ve got to balance two things that are often at opposition. First, you’ve got to manage risk. You’ve got to be confident that the agency you choose has the ability to deliver a quality outcome at the price and schedule you need. But you also need to move quickly. After all, speed is your best advantage against your larger competitors, so taking a month+ to find the best option is time you can’t afford to waste.

TinyRFP gives you the best combination of risk management and speed. But how do you write a TinyRFP so that you can get the information you need to make an informed decision, at the speed you need to keep on schedule? In this article we cover the things you should include in a TinyRFP to be sure responses will be thorough, how to make your TinyRFP stand out, and how to think like a provider so you can anticipate questions and cut down on back and forth. Read on to learn about making your TinyRFP shine!

As you sit down to write your TinyRFP, you’ll probably have questions about what to include. In this section we’ll look at the handful of things to include in the text, and cover a couple of items that TinyRFP has special places to list.

It might sound obvious, but the most important thing to include in a TinyRFP is what you’re looking for. Need an explainer video made? Need two python developers to augment your team? Need a logo and website redesign? Need a grant writer to help apply for an STTR? If you don’t list that up front, providers won’t know whether they might be a fit.

A TinyRFP is intentionally small, but you might have a very detailed list of requirements. It’s a good idea to publish that detailed list somewhere and add a link to it in your TinyRFP (but make sure the location you publish the requirements to doesn’t let the provider know who’s behind the RFP!). Add links to any other information that would be helpful to a proposal as well.

The next thing you’ll want to include is what will make a proposal stand out to you. If previous experience in your industry is important, make sure you include that. And make sure you ask providers to include links to their previous work as well, so you can review it. If you’re looking for proposals from businesses owned by underrepresented founders, that’s also worth including. Other things to consider:

You actually don’t need to include budget in the text - we have a field for that, and it’s only visible to you and your team. It’s probably not a good idea to share your budget with providers, since bids have a funny way of being exactly the same amount as your budget, if the person knows it when making a proposal.

Even though you don’t have to (and shouldn’t) put your budget in the proposal text itself, it can be helpful to include the phrase ‘budget has been allocated for the project’, if indeed that’s the case. We talk more about why later in the article.

Do you need a provider that’s local to you?

This is a tricky one! Depending on the project, it can make a huge difference to work with someone local. But budget is always a consideration, and for a project that’s mostly based on professional services effort, cost of living is one of the biggest factors that influence the proposal price. So you’re really trying to balance the amount of time you’ll have to interact with them in real-time, with the potential cost savings from hiring a provider in a lower cost-of-living area. Here are some key things to consider:

TinyRFP includes a location restriction field for you to list any location considerations you have, so you don’t need to include this in the RFP itself. But even if you do say “I can only accept proposals from companies based in Los Angeles”, or “I need you to be in the U.S. Eastern Time Zone”, you’ll likely get bids from providers that don’t meet your location requirements. So it can be helpful to include in your RFP that proposals from companies that don’t meet the location requirements will be rejected without a response.

TinyRFP is unique in that you can reach potentially hundreds of solution providers almost immediately. But also, TinyRFP is anonymous until you choose to add responses to your shortlist. And providers are going to be looking for some evidence that this isn’t just a company fishing for bids - they want to know you’re serious before they put the effort in to craft a proposal. At a minimum they’re going to follow one of the popular sales qualification strategies; <a href="https://www.techtarget.com/searchcustomerexperience/definition/BANT">BANT</a>, <a href="https://www.insidesales.com/anum-sales-qualifying-leads/">ANUM</a>, <a href="https://www.rainsalestraining.com/blog/sales-prospecting-guidelines">FAINT</a>, or MEDDIC. All of these have slightly different ways of expressing qualification, but at a minimum they’ll want to know there’s a champion (which might be you), there’s budget assigned (but don’t put this in the RFP text - we’ve got a private field for it!), that you have a clear need, and that you either want to start now or you have a defined point by which you do want to start.

So a good thing to add to your TinyRFP is a set of signals that they can use to decide whether to bid, and how much energy to put into their bid. Although TinyRFP includes specific fields to record your budget, which isn’t shown to respondents, and timing, which is, if you feel comfortable doing so, feel free to include in your RFP that you have a budget and champion for the project identified, and when you’re looking to start. This will help respondents know you’re serious and you’ll get higher-quality proposals overall.

It always helps to see examples of good TinyRFPs, so you can adapt them to your needs. Here are a few that were successful. You can use these as a model for your own TinyRFP.

Even though a TinyRFP might be only a few sentences, there are a lot of considerations that go into crafting a good one! Between the considerations we’ve listed and the examples we’ve provided, hopefully you have a good idea of how to write your own. Get started at <a href="http://tinyrfp.com">tinyrfp.com</a> , and if you need help writing or just want to get feedback, feel free to reach out to us at <a href="https://www.notion.so/Competitors-9b947220a41247bbb987ff3978629342?pvs=21">hello@tinyrfp.com</a>.

Learn how to write a TinyRFP so that you can get the information you need to make an informed decision, at the speed you need to keep on schedule.

How to write a good TinyRFP

Even before the onslaught of AI tools in 2022, cold email outreach was going through some stuff. Combining a LinkedIn scraper with an enrichment tool like ZoomInfo or Clearbit or Apollo gave you a list of decision makers and their contact info. Combine that with AI and now you can literally make a unique message for each recipient!

Yeah so the problem is, so can your competitors. And people not even in your industry. And people selling wildly unrelated things. And even if your good message gets to your recipient, it's just one of hundreds if not thousands of other emails. This saturation has two major effects:

Companies that heavily depend on email outreach are already seeing the growth ramp get steeper. And it's getting worse.

<a href="https://blog.google/products/gmail/gmail-security-authentication-spam-protection/">Gmail's upcoming changes in February 2024 </a>introduce strict criteria for bulk email senders:

Companies used to consider their cold outreach as legitimate email - spam was for Nigerian get-rich schemes and off-brand medications. 

If this wasn't already on your radar as a service provider using cold email outreach as a channel, it should be. The authentication process can be complex, and managing the spam rate threshold will require careful monitoring.&nbsp;

This sections is going to get a little technical and jargon-y, but it's important to understand what you'll need to comply with (and to be clear, some of this is going to be covered by your email service but the risk definitely stays with you):

It's worth noting that these are not new technologies, and most reputable bulk email providers already comply with them. But compliance is likely to drive cost of email up a lot in 2024.

The introduction of a one-click unsubscription feature by Gmail has always been optional, but now that form your email provider has carefully crafted from dark UX patterns won't even get a chance to confuse users into sticking around.

This is great for email users (and at the end of the day, we're all email users), but it's gonna make it a lot harder to minimize loss of subscribers.&nbsp;

Want to read more on this topic? There are good overviews <a href="https://www.listrak.com/blog/understanding-gmails-new-bulk-sender-requirements">here</a> and <a href="https://www.emailtooltester.com/en/blog/gmail-yahoo-mail-authentication-changes/">here</a>.

Of all the changes listed, this is the only actually new one.&nbsp;This threshold sets a limit on the acceptable rate of emails marked as spam by recipients. Here's what businesses need to know:

Time will tell what happens to companies using cold email outreach that run afoul of these limits, but it definitely won't be good.

GMail may be the largest email provider but it's not alone in this Yahoo, alongside Gmail, is making these changes at the same time. And Apple, as one of the other large email providers, already has strict privacy programs like Hide My Email. 

Here's the real trick. All of these email services; GMail, Yahoo!, Apple, are all free to their users. Those companies monetize in other ways, but your cold email outreach isn't making them any money. So there's no incentive for them to help you with deliverability at all. Your email is overhead.

Cold email outreach was always a numbers game. If you sent 100 emails and got two leads, it was a good day. Now it might be more like 2,000 for two leads. What if that goes to 20,000 in 2024? What if it goes to infinity?

The weakness in email outreach always was timing. Not just getting in their inbox - getting a message to them at the moment they're ready to buy. That's likely to get 10x more expensive next year, if not altogether impossible. <a href="https://tinyrfp.com?ref-cold-email">TinyRFP</a> gives you a chance to shoot your shot with companies that are actively looking for your solutions. Give it a shot - <a href="https://tinyrfp.com?ref-cold-email">browse RFPs for free</a>, and you might decide to dump your cold email outreach altogether.

Are you ready for the Cold Email Outreach Apocalypse in February 2024?

Is 2024 Going To Kill Email Marketing?

It’s 10:12 a.m. as I write this. I’ve just received my third email of the day from a company offering software development services. This one reads:


<code>I hope you are doing great and staying safe. I'm [**name and company redacted**] and we specialize in web and mobile app development, with expertise in MERN/MEAN stacks. Have you explored these technologies for your projects?</code>

<code>Would you be open to a quick chat about how they could benefit your business?</code>

The chance that this email hits me at the exact moment I’m both a) ready to augment my software development team, and b) already using this technology stack or at least in a position to consider switching is vanishingly small.

If I’m feeling generous with my time, I might write back and say “no thanks, we don’t use those technologies and we’re not currently looking for this type of support”. But If I do I’m guaranteed to end up in a conversation where this salesperson pushes for a meeting “to understand my current needs”. And that, I definitely do not have time for.

And yet, there are moments where hiring a software development partner is absolutely the right choice. I’ve done it dozens of times in my career, as has my co-founder Noemi in hers. When we’ve identified a need and established a budget, how do we find the right partner?

If we already know a firm, it’s easy. Just contact them. But technology moves quickly, and nobody has a go-to for every need.

Get a referral. Noemi and I are members of a <a href="https://randsinrepose.com/welcome-to-rands-leadership-slack/">fantastic community of interest for leaders in software</a> (it’s actually how we met!), and sometimes they have recommendations. It’s worth a shot.

If neither of those turn something up, there are plenty of <a href="https://clutch.co/">solution</a> <a href="https://www.g2.com/">provider</a> <a href="https://www.forrester.com/research/technology/">directories</a> out there. They do a decent job of categorizing providers by service, project size, and sometimes even areas of expertise.  Building a shortlist this way looks like:

Hours of time and effort, to maybe get a viable option.

This process isn’t any better for solution providers! Both Noemi and I have worked for agencies in the past. Business development is a constant challenge when your work is project-based. Here too, the best source of new business is warm referrals from your existing clients, but that only goes so far. Your outreach options are not great, either:

We built TinyRFP because we’ve personally experienced the pain of both sides of this process. Companies that need services fill out a TinyRFP. A few sentences to describe what you need, list any unique requirements (location restrictions, tools or technologies you need to use or integrate with, when you want to start, and when you need to finish.

TinyRFP creates a portal with a shareable link that you can use to invite responses. The best part is, because it's hosted on TinyRFP you won't get people filling up your inbox and LinkedIn with connection requests 'wanting to learn more about your requirements'. You get to manage the selection process at your own pace, without the overhead of a full RFP and all its big-company overhead.

The next time you've got a service provider to hire and no obvious option, give <a href="https://TinyRFP.com?ref=why-blog-post">TinyRFP</a> a try!

Find a great solution provider easily with TinyRFP. Fill out a TinyRFP and invite responses, managing the selection process at your own pace. Give it a try!

How to choose the right company for your software development project [+ free scoring template]

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