Custom Software Development Services: Market Overview
Best Trends on the Custom Software Development Market: 2023

Custom Software Development Services: Market Overview

According to Forbes, custom software development has great potential to improve your business. It’s possible to get your company exactly the features you need which will provide benefs like long-term savings and a significant competitive advantage.

Businesses can’t last long with template-based applications that aren’t tailored to their needs. Even global companies like Twitter and Google constantly collaborate with outsourcing teams to hone their products and build new solutions.

Our research shows that JavaScript is the most popular programming language, while DevOps is the most popular software development methodology. We also reviewed the average costs, best countries for outsourcing, and the industries that are worth your attention. Read on to stay up-to-date with the market!

What is the state of the custom software development services market?

The global custom software development market size was estimated to be $24.46 billion in 2021. It’s expected that the industry will grow at a CAGR of 22.3% by 2030. Simply put, experts predict a significant increase in the number of companies investing funds in turnkey development.

It’s interesting to note that spending on enterprise reached $615 billion and is expected to increase to $755 billion. That’s enough to purchase almost half of the buildings in London! With over 27.1 billion downloads on Google Play in Q2 of 2022, the industry appears to be growing regardless of global cataclysms like pandemics and wars. 

Another prominent fact is that categories like game development, mobile app development, CRM & ERP development, and many others have evolved into their own groups. We can see substantial segmentation, showing that this market is much more complex than a single service.

Where do companies outsource software development?

Outsourcing is a model where a company delegates the development process to a third-party vendor while retaining ownership of the product. It brings multiple benefits like cost-efficiency, faster time-to-market, and an increased talent pool.

In our previous article, we discovered that most businesses collaborate with outsourcers from the following



Country Rates English Proficiency Peculiarities
Ukraine From $10 to $40 per hour Ranked 35/111 Awarded as the delivery destination of the year
Poland From $30 to $50 per hour Ranked 13/111 #12 in the Kearney Global Services Location Index
Romania From $18 to $50 per hour Ranked 17/111 #18 in the Kearney index
Czech Republic From $30 to $50 per hour Ranked 23/111 105,000+ developers in the country
India Starting at $5 per hour Native speakers #1 in the Kearney index and holds 50% of the global market


You can find a detailed overview of the most prominent outsourcing locations here.

How much does custom software development cost?

Your project may cost anything between $50,000 and $500,000 depending on multiple factors like the industry, requirements, complexity, and your team’s location. Detailed estimates can only be provided after knowing your technical task inside out. 

However, it’s possible to estimate the potential costs by browsing the average salaries of the most common team roles in the US:


Considering that the average project takes anything between 4-9 months, you can calculate the approximate costs using these rates. 

What are the most popular programming languages?

The most popular programming languages worldwide are:

  • JavaScript – 63.36%;
  • Python – 48.07%;
  • TypeScrypt – 34.83%;
  • Java – 33.27%;
  • C# – 27.98%;
  • C++ – 22.55%.

If we speak of specific countries like Ukraine, then the most popular languages here are:

  • JavaScript – 18.4%;
  • Java – 15.4%;
  • C# – 13.7%;
  • Python – 13.2%;
  • PHP – 10.8%.


Knowing this information is essential to understand how the current market develops and which talent would be the easiest to find.

What are the most popular software development methodologies?

Although there are many methodologies in software development, the following options prevail:

  • DevOps or DevSecOps – 47%;
  • Agile or Scrum – 37%;
  • Kanban – 34%;
  • Lean – 29%;
  • Water-Scrum-Fall – 28%;
  • Waterfall – 26%.


This shows that most companies are trying to provide continuous delivery by shortening the SDLC while providing superior quality. Some benefits of using DevOps include a faster time to market, increased security, and improved teamwork.

Types of Software Development Services

We may classify the software development services available on the market into six predominant categories. This will help you understand the differences between each option.



This service involves the creation of an application for certain organizations or sets of users. It focuses on a narrowly defined set of requirements, meeting unique demands and providing businesses with a competitive advantage.


For example, Microsoft Office is a packaged commercial product designed to meet the generalized needs of the majority of people. However, custom software may cover specific needs like:

  • A maintenance program for field service equipment;
  • A FinTech solution designed to work with a specific bank and its systems.


Custom solutions are usually built in-house or outsourced to a reliable third-party team. The development process is almost the same as with any other software. Some differences may be in the challenges of customization, modernization, and management.


Developing a custom application provides the following benefits:

  • Efficiency. The app is designed for a certain purpose, making it work best with related tasks;
  • Scalability. The developers can ensure the app meets growing business demands in the future;
  • Simple integrations. The app can be designed to support the required integrations, reducing costs and development efforts;
  • Independence. If you don’t like something about the app, it can be changed and improved. You also do not need to worry about licensing and project support.


This service is frequently requested by businesses, large organizations, and manufacturers.



Mobile development is the process of creating software for smartphones, tablets, smartwatches, and other similar devices. It can be divided into two elements:

  • Native development – creating apps for a single specific platform;
  • Cross-platform development – creating apps that work on several platforms.


The platforms are usually Android or iOS, although there are also less popular options like Symbian or Blackberry. Finding software engineers for the latter options is much harder.


Android developers need the following tech stack:

  • Java or Kotlin;
  • Android SDK;
  • Android Studio.


iOS developers need a slightly different set of technologies:

  • Swift;
  • Apple’s Xcode IDE;
  • Objective C.


If you’re interested in cross-platform mobile development, then you might want to focus on React Native, Xamarin, or Ionic. These are the platforms that provide the required codebases. However, note that a cross-platform app will always perform worse than a native app.



Web development refers to the creation and maintenance of websites. It also includes aspects like UI/UX design, web publishing, and database management. Engineers must use modern technologies to ensure their web pages & apps work perfectly in all browsers.


There is also a division here:

  • Front-end development – creating the client-side elements of the solution. It usually requires knowledge of HTML, CSS, jQuery, and JavaScript.
  • Back-end development – creating the server-side elements of the solution. This requires knowledge of Python, Java, PHP, SQL, and others.


Note that the mentioned languages may differ as the tech stack for web development has multiple options, allowing developers to create feature-rich solutions.



Cloud development covers the creation of software that runs cloud applications like Amazon Web Services or Microsoft Azure. It’s a complex process requiring high-level skills and significant investments to maintain the infrastructure. 


This service includes the following models:

  1. SaaS (Software-as-a-Service);
  2. PaaS (Platform-as-a-Service);
  3. IaaS (Infrastructure-as-a-Service).


Here are some of the skills a cloud developer needs:

  • Knowledge of SQL, Python, XML, .Net, and others;
  • Understanding of DevOps;
  • Ability to build secure systems to minimize vulnerabilities;
  • Knowledge of cloud platforms, and other skills.


Considering that the public cloud services market is expected to grow by 20.7% in 2023, we can predict that this may be one of the leading areas in the near future.



Embedded development is the creation of software for everyday consumer products. The Internet of Things (IoT) is a popular technology that works with embedded systems. It includes a lot of elements like automation, monitoring, machine learning, artificial intelligence, and other options.


When working with embedded systems, you will need a team with extensive expertise in firmware, hardware, and software. It’s an industry with hundreds of technologies, so finding the right professional for your project might be challenging. For example, there are only 4045 embedded engineers in the United States.



IT consulting services help people improve their software, determine challenges and opportunities, and find the most effective solutions to current issues. This also includes helping companies evaluate their IT needs and form a system implementation plan.


In most cases, IT consultants are experienced software developers of middle-senior levels. These people have profound knowledge of how things work in practice, so they can apply their backgrounds to help your business.

Most Popular Industries in Software Development

Software developers frequently seek new and creative ways to advance their careers and hone their skills. There aren’t that many industries that pose constant challenges and require using new technologies. We’ve gathered the most popular options in the market.



As we’ve mentioned previously, the Internet of Things is related to embedded development and that’s a very challenging activity. It frequently comes along with ML and AI. This is seen as the future of technology, improving human life and automating routine activities.


Experts predict that the global spending on IoT $1.1 trillion in 2023. Also, consumers are expected to spend $123 billion on IoT products by the end of 2025. Finally, technology spending on smart city initiatives is projected to reach $189.5 billion in 2023


These numbers prove that the industry is growing at a rapid pace, while constantly providing developers with new challenges and areas for improvement. 



Blockchain technologies are booming with cryptocurrencies, NFTs, smart contracts, and many other technologies. It’s the ultimate solution to increase security and transparency, used in nearly all possible industries in the digital world.


Forecasts show that global spending on blockchain solutions should reach $19 billion by 2024, while the industry with the largest blockchain market revenue is banking. Another interesting fact is that the Bitcoin blockchain size reached 406,05 gigabytes on July 10, 2022, and it’s constantly growing.


Just like IoT, the blockchain industry is expected to reach nearly every aspect of our life in the near future.



Financial technologies are always going to be up-to-date as long as people use money, therefore they will continue indefinitely. This area covers the development of banking software, financial management apps, money transfers, and everything that is related.


It’s expected that the total transaction value of digital payments will reach $9,471 billion in 2023. Simultaneously, 65% of US residents were projected to use digital banking in 2022. Also, 70% of senior banking employees stated that collaborating with fintech was an important opportunity for banks.


That’s why FinTech is among the leading industries that are always in demand and constantly setting new challenges.



iGaming is a fancy term for online gambling and casinos, and their popularity has been increasing significantly in the last few years. It attracts developers with high incomes and a constant requirement to develop new solutions.


Statista’s forecast states that the online gambling and betting industry will reach a market size of $114,4 billion by 2028. Now iGaming can be accessed not only via dedicated websites but also through mobile applications. This draws a larger audience, which increases the industry’s revenue.


While many developers avoid putting iGaming projects on their resumes, it still attracts their attention due to all the possibilities and benefits.



SaaS solutions are extremely popular due to their online availability and subscription models. Some examples of SaaS are Netflix, Canva, and Dropbox. They are well-known for their functionality and practicality, being available on any device at any time.


The global SaaS market size is projected to reach $195 billion in 2023. The revenue from the cloud market is estimated to reach $490 billion in the same year while the largest market share is in the United States.


The SaaS industry requires extensive cloud computing skills that really pay off.



There are many other industries that are interesting, challenging, and rewarding. They include:

  • MedTech;
  • EdTech;
  • Marketing;
  • Automotive;
  • Cybersecurity;
  • Data science, etc.


Sometimes the same technologies can be used in different areas, so you might have a chance to switch industries and try out various options.

Most Popular Collaboration Models

When choosing a software development services provider, people often confuse the available collaboration models. We gathered the most popular collaboration models to outline the differences and help you avoid confusion.

Staff augmentation


Staff augmentation is a model where businesses use outside personnel on a temporary basis to fill short-term positions. This is often done to support current teams during their projects or get the required skills while there’s an ongoing recruiting process. 


Staff augmentation is used when:

  • You need to increase capacity to meet a sudden demand;
  • You need a specific skill for a one-time project;
  • You need to speed up the development process.


While this is a great option for flexibility and cost-effectiveness, you might stumble upon inconsistent quality. This model is associated with a high turnover, so it’s possible that you could get specialists with different levels while covering the same position.

Team extension


The team extension model is a combination of staff augmentation and dedicated teams. Its major difference is that you hire whole teams instead of standalone experts. At the same time, you maintain full control over your project.


Extending your team is necessary when there is a major skill gap in the project. This helps you get a team of people who already know each other and work together. They analyze your project requirements and complete the task. As a result, you comply with all deadlines.


While you may save a lot of time and access top talent, you might have some challenges integrating the extended team with your in-house team. This means that it’s important to ensure they are a great cultural fit and speak the same language.

Offshore development


Offshore development means hiring experts from all around the world. As you extend your reach, you can easily hire developers from Ukraine or India to meet your needs. The best part is that these professionals will be part of your in-house team, fully dedicated to your project. 


This model is the best choice when you are working on a long-term project and expect the team to value the results. Offshore developers often have decent English proficiency, so you’ll be able to communicate with ease.

How to Choose a Custom Software Development Company?

Choosing the best company for your project is a challenging task because it comes with a lot of responsibility. We know you want to build a great product. But how do you know which vendors are reliable? These three steps should help.

Read reviews


Most reliable IT companies have their profile pages of or Goodfirms. That’s where you can find real client testimonials about the team, their approach, and their results. Reviews are important because they let you peek inside the company before you get in touch.


The reviews on these resources can’t be forged as each client is individually interviewed by the website’s representative. They ask about everything in detail, ensuring the information is complete and provides maximum value to readers.

Read case studies


Case studies are proof that a company has experience in the industry and can create powerful projects. They let you see the team’s style before collaboration and determine whether their background is relevant to your task. However, remember that some projects can be left out due to NDA requirements.

Talk to the team


A live conversation with the team can help determine whether they’re the perfect match. By conducting a Zoom call with your future partners, you can estimate their technical knowledge and see how well they work together. This way, you’ll know whether they pass “the vibe check”.

Partner with StartupSoft

StartupSoft ensures that remote is no longer the opposite of in-house. You don’t have to bother hiring freelancers or shady “experts” when we can help you find reliable professionals. These people share your values and put their hearts into their work to ensure your product is successful.


Our team covers all the boring processes from sourcing to team retention. 

All you need to think about is your project’s progress. We’ll ensure it’s swift and effective.


StartupSoft will bring you people who expect long-term commitment and have proven expertise in your industry. You’ll save money and maintain top-notch quality. Interested?

Shall we try?

If you’re looking for a reliable partner that would hand-pick top tech talent for you, we’d recommend checking out StartupSoft. We know we might
be biased, but we’re quite confident we’ll be able to make that perfect tech match for you.

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What are software development services?


These services cover the whole project from idea to implementation, helping you bring your vision to life. There are many types of development services: custom, mobile, web, cloud, etc.

What is custom software development?


It is the process of creating a unique solution designed for a company or specific set of users. It is focused on a narrowly defined set of requirements, ensuring the app is great at performing the tasks it’s designed for.

What is the difference between software development and web development?


Developing software means creating software for an operating system, network, or platform. Web development focuses on websites, e-commerce, and sometimes mobile development. These are two completely different areas.

What programming languages are needed for web development?


Web development requires knowledge of JavaScript, Java, React, Angular, Objective C, Scala, and many others. The complete tech stack depends on your project’s requirements and expectations.

How much does custom software development cost?


A custom project may cost anything between $50,000 and $500,000. The final costs depend on your project’s requirements, complexity, technologies, and other factors. Also, your team’s location plays a huge role in the price, as outsourcing to Eastern Europe can save 81.1% of your budget.

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