Every company that needs to speed up its technology reaches the same question: hire an in-house team or bring in an on-demand squad? The short answer is that it depends. The useful answer is that it depends on criteria you can assess objectively. Building and running squads for large banks, payment companies and the public sector, we see the same factors come up in almost every decision.
Speed to start
Hiring a full team takes time: opening roles, interviewing, negotiating, onboarding. Until the team is productive, the project waits. An on-demand squad arrives with defined roles, such as product, development, quality and architecture, and with proven ways of working. When the market window is short or there is a regulatory deadline, that difference matters a lot.
Total cost, not just the hourly rate
Comparing a salary with a contract price is misleading. The cost of an in-house team includes payroll taxes, benefits, recruiting, tools, training, technical leadership and the cost of turnover. The cost of a squad includes the vendor’s margin, but it also absorbs much of that list. A fair comparison looks at the whole life cycle of the initiative and at what happens when demand drops.
Business knowledge
This is where the in-house team usually has the edge. Business rules, decision history and relationships with business units build up over time. For core systems that set the company apart, it makes sense for that knowledge to live in-house. For initiatives with a clear beginning and end, or for skills the company does not need permanently, a squad tends to be more efficient.
Dependency risk
The fear of being locked in to a vendor is legitimate. It should be handled in the contract and in daily practice, not used as a reason to rule out the model. Code in the client’s repository, documentation as part of the definition of done, recorded architecture decisions and full access to environments reduce that risk in concrete ways.
The right question is not who will write the code. It is where the knowledge needs to live a few years from now.
Hybrid models
- In-house core, external capacity: the company keeps product and architecture, and the squad expands delivery capacity.
- A squad that builds the team: the vendor starts by delivering and, in parallel, helps recruit and prepare the in-house team that will take over.
- Squads by initiative: each strategic initiative gets a dedicated squad, with its own goals and shared portfolio governance.
A planned knowledge transition
If the goal is to bring the work in-house later, the transition starts on day one, not in the last month. Pairs of internal and external engineers, rotating code reviews and a handover plan with clear criteria prevent knowledge loss when the contract ends.
In practice, the best decision is rarely all in or all out. It is choosing, for each initiative, the model that delivers fastest today without giving up tomorrow’s autonomy.
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