Freelancer vs. Full-time vs. Software Development Companies: Who Should I Hire?

Arcanium Software
Published in
6 min readNov 11, 2021


Woman sitting at a desk writing lines of code on a computer.

You have an amazing idea that needs a software developer. You know that this isn’t something you can do independently, so you might call in an expert. When it comes to software development, you can hire a full-time employee, a freelancer, or an agency. They all have pros and cons, but how do you know which one is right for you? Well, first you need to know something about your project.

  • Is it a long-term or short-term project?
  • If your project will run for months or years, do you have the resources to support a project of that length?
  • Is your project going to take less than a year to complete?
  • Once the project is complete, will you need updates, troubleshooting, or maintenance?
  • Do you know what your budget is for the project?
  • If you hire someone full-time, have you included insurance, benefits, training costs, taxes, salaries, and resources such as office space or hardware expenses?
  • Do you know what specifications you need for your project?
  • Do you know what technical requirements and features you need for your project to be successful?
  • Do you have somewhere to store any hardware that might be needed?
  • Will you need someone to consult on your project?

Long-term projects are typical times to hire someone full-time. However, look at the costs that go into hiring someone, and consider your budget. You need to create a job post, distribute the posting, review resumes, interview candidates, go through mountains of paperwork, take administration time, onboard and train the employee, and hope they stick around for the project’s duration. Once you’ve hired them, you not only have their salary to think about, but you also have to think about benefits, office space, equipment, taxes, insurance, and everything else that goes into hiring a full-time employee. That’s a lot of time, effort, and resources to put into hiring someone. And if they do leave, then you have to go through the process all over again.

You could hire a freelancer in place of a full-time employee. You wouldn’t have to waste time and resources, and you can pay by milestones. But what happens when the project is over? If you’ve hired someone as an employee, you can keep them on for any maintenance, troubleshooting, or updates needed. A freelancer will often cost less than a full-time employee. However, once the project is done, you’re on your own. A freelancer might be your best bet with a smaller project, but what about when you need updates? Do you go through a vicious cycle of hiring a freelancer every few months? That’s a pretty big task.

A software development company is an extension of your team. When you hire a software development company, they take on the responsibility of “hiring” a developer for you. They can attend meetings, help with presentations on the project’s progress, and so much more. Companies that do this, like Arcanium, have full-stack developers with skills and experience in all different programming languages, industries, and frameworks ready and available. Software dev companies will also provide more value to your company in the form of business analysis, consulting, idea verification, monetization medals, and more. These companies will also be more up-to-date with technologies and trends. Much like your company staying up on the latest industry trends, software dev companies will want to have the latest and greatest services available to their clients.

Let’s take a look at some pros and cons of each option:

Pros of hiring a full-time employee:

  • You get a valuable member of your team. A full-time employee will become part of your company’s culture. They are accountable for their work, and you have measurable outcomes to base their performance on.
  • You can collaborate with them. As technologies change, you can collaborate with your employee about what changes you should make. This will help keep your company at the forefront of industry changes.
  • You can send your employee for ongoing training. Having your technology up-to-date is just as important as having your employees up-to-date on how to use it. You can ensure your employee is well versed in the tech you need to use with training.

Cons for hiring a full-time employee:

  • You have fees other than their salary to think about. A full-time employee costs more than just their salary. You also have to pay payroll taxes, insurance, benefits, extra costs of having an employee in the building such as electricity, and providing them with a desk, computer, office, and anything else they might need.
  • It’s not easy to terminate a full-time employee. If things aren’t working out between your company and the employee you hired, you have to be strategic about letting someone go. If you terminate without cause, you could have to pay unemployment or provide a severance package.
  • They aren’t always the most productive at work. Everyone has that one person at their job that they bond with. Having a full-time employee means they will also hang out and chat with other employees, take coffee breaks, jump on social media, etc.

Pros of hiring a freelancer:

  • You will usually have a lower rate with a freelancer. Hiring a freelancer is a very competitive market, so people will usually lower their rates to land the job.
  • Freelancers are easy to find. There are several different sites where you can hire freelancers for your projects.
  • You can find a freelancer that is highly skilled in the specific field that you need. Freelancers will usually master their craft in one area, so you can find someone very capable of completing your tasks and projects seamlessly.
  • Since you are not hiring a full-time employee, you don’t have to worry about the extra costs of benefits, insurance, space, and other costs associated with an employee.

Cons for hiring a freelancer:

  • Once the job is complete, you are on your own. If you need maintenance, updates, or troubleshooting help, you won’t have anyone available.
  • Freelancers make their money taking on projects. This means your project most likely isn’t the only one they’re working on. That also means your project won’t take precedence over their other work.
  • Sometimes freelancers don’t care about creating repeat customers. They might complete your job, but they don’t always worry about the quality of work.

Pros of hiring a software development agency:

  • With a software dev company, you have access to expert talent and services to supercharge your startup. Get your idea validated, launch your MVP, and achieve product-market fit with the flexibility and speed you need.
  • These types of agencies love returning clients. They have good systems in place for communication, milestone checks, and reporting to their clients. Although they will also have other projects they are working on, they have teams that handle these projects. Meaning your project is the most important project to that team.
  • You want to have the latest and greatest trends in your business, and so do software dev agencies. They make sure their employees are skilled in industry-leading technologies and trends. They can also make sure their developers have ongoing training to keep their skill sets extremely high.
  • Agencies will have a level of accountability that you won’t find in freelancers or full-time employees. You will get a professional approach and reliability when it comes to contractual obligations and product delivery. Your project is added to their portfolio, so they will do everything to ensure top-quality deliverables. They will most likely also provide further support and maintenance when needed.

Cons to hiring a software development agency:

  • You get what you pay for. Having access to top talent and all of the other benefits of working with an agency does come at a higher price than hiring a freelancer.
  • With a higher price also comes rate differences. Sometimes agencies work with developers all over the world. Rates can vary from country to country.

What does this all mean for your software development needs? Well, there isn’t a one-size-fits-all solution. Your project will determine what will be right for you. You know your business needs and budget better than anyone. Keep in mind that full-time employees can leave, freelancers are busy with other projects, and yours, and agencies, although they can come with a higher price tag, will offer free consultation calls so you can talk about your project a little more in-depth. If you think a software dev company is right for you, reach out to us today! We’d love to help you bring your idea to life.