Development Agencies Classified

It takes time and a lot of hands on experience but you eventually start to see it. We’re talking about the various types of service providers in any business. We’ve been setting up a database of app development agencies for the last 4 years now and have seen and documented the pattern here.

Understanding how this market is distributed would help in 2 ways –

1. Your search for the right team would be more accurate.

2. If you’re already working with a team, it’ll be easier taking the decision to continue working them or not.


Say hello to the elite in the app dev market. Only about 5% of the development agencies in the market fall into this category. There is a special reason we call them CTO’s office. The teams are small and composed of the most experienced engineers. Chances are that you’ll mostly interact with the company’s founder on the first call. Founders are usually ex-Senior Engineers or Product Managers at a successful product startup. Working with them is like having a tech co-founder on board. This is due to the amount of experience and business savviness they bring to the table. These teams are pretty expensive and typically prefer working on projects where a really complex product needs to be built, where innovation is required.


As the name suggests, these development agencies are experienced and very capable of delivering a good product. Unlike type 1 teams, they can’t give inputs on the features to include and avoid in your first build. They would also depend on you for guidance on what the product should do. As long as you are clear on your product roadmap, these teams would be competent enough to build the features that have been planned. They make up roughly 20% of the market and can have anywhere between 25 to 200 employees. Having worked on their fair share of tough projects with challenging situations, we’ve seen these teams work with and deliver successfully for demanding customers as well. They usually charge half of what type 1 teams do. The teams are the best option for startups with angel investment or companies with a decent outsourcing budget. On the other hand, they might still prove very expensive for early stage startups or first-time entrepreneurs.


This category contains nearly 75% of the teams out there. And within this, there is room for a lot of difference between the teams though some similarities do exist. These teams have a slight learning curve compared to Type 1 & 2 teams. Hourly rates are low, which makes them a good choice for companies who wish to sub-contract work. Many of these teams employ freshers as opposed to experienced resources to keep project costs low. Classic “I burnt my fingers with this team in India” stories usually involve such firms. So unless and until you already have an in-house tech team which can micro-manage such resources, working with these type of development agencies would be tough. Even though they seem affordable in the short term, they can prove to be expensive in the long run with project delays, bugs and other such issues.

Picking the right development agencies

Picking a team isn’t just about knowing which category they belong to or what product they built for some customer. Would you rather have a disinterested type 2 team or a hard working type 3 team who have good amount of experience building a similar product? A good portfolio goes a long way in showing a team’s credibility but it’s better to get a couple of client references from the team to see how they worked with them. This would really help in figuring out if they are the perfect fit for you.

Author Bio: Pravir Ramasundaram is our content writer here at ContractIQ. Keep dropping by to read more by him about mobility and outsourcing.

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