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How to Choose a Software Development Company: A Checklist for Small Businesses

Hiring a team to build custom software for the first time? Here is how to prepare, what to ask, how to compare estimates and contracts, and the red flags to catch before you sign.

Updated October 17, 2026

Before you contact a software development company

Choosing a software development company is a business decision as much as a technical one. For a small business, clinic, law practice or local government, in Denver or anywhere else, the goal is a team that understands the work, explains the trade-offs, manages risk and supports the software after launch.

Before the first call, know what problem the software must solve, who will use it, which systems it must connect to and which constraints matter. You do not need a full technical specification, but you do need enough detail for a useful answer instead of a broad sales conversation. A shared description also lets you compare proposals on the same basis.

Write a short project brief first

One to three pages is enough for a first conversation. Our project brief guide walks through it; the essentials are:

  • The problem: what is slow, manual, risky or hard to track today.
  • The users: staff, customers, patients, clients, residents, administrators or partners.
  • The core tasks: submit a form, upload a file, approve a request, check a status, run a report.
  • Current tools: spreadsheets, software, databases or websites it must connect to.
  • The data: personal, health, legal, financial or public records.
  • Deadline drivers: a grant, a budget cycle, a regulation or a season.
  • Budget range: a realistic range, or at least how approval works.

Describe outcomes, not technology. "Staff review and approve permit applications online" says more than "we need a dashboard."

Local or remote: does a Denver team matter?

A local team helps when in-person workshops, stakeholder meetings or knowledge of Colorado business and public-sector practice matter. A remote team can work just as well with clear communication and relevant experience. Location matters less than whether the company understands your kind of organization and can explain its process.

Compare on what actually affects the project: whether your people prefer meeting in person, experience with similar organizations, overlapping working hours, how workshops, demos, testing and training happen, and whether the contract sets out who communicates what and when.

Questions to ask in the first call

  1. Have you worked with organizations like ours? Ask for comparable workflows, not identical products.
  2. How do you define scope? Listen for discovery, user roles, workflow mapping and acceptance criteria.
  3. Who is on the team? Project management, design, development, testing, security and your day-to-day contact.
  4. How do you handle changes? Custom work changes as details become clear; ask how changes are written down, priced and approved.
  5. How often will we see working software? Regular demos let non-technical people check the fit early.
  6. What do you need from us? Decisions, feedback, test data and approvals take your time too.
  7. What happens after launch? Bug fixes, hosting, monitoring, updates, documentation and training.

If a company cannot explain its process clearly before the contract, communication during the project is unlikely to be easier.

How to check past work and references

Look for relevance rather than surface similarity: similar complexity, data sensitivity, workflows, integrations or public access. Confidential work may not be shown live, but the company should still be able to describe the problem, users, constraints and outcome. A public body should also ask about accessibility, procurement and records experience.

When you call references, ask whether the team understood the business before building, whether estimates and timelines were explained, how scope changes were handled, whether there were surprises in cost or schedule, whether the software was usable at launch and how support has gone since. The most useful answers describe how problems were handled.

Who owns the code and the repository

Settle ownership in the contract before work starts. The source repository is where the code lives and its history is kept; know where it will be, who controls access and what happens if you change vendors. Ask in writing:

  1. Will we own the custom code after payment?
  2. Will we have access to the repository, ideally under our own account?
  3. Does the vendor keep any reusable components, and on what license?
  4. Which frameworks, plug-ins or services need licenses or fees?
  5. What documentation will we receive for future maintenance?
  6. Could another qualified developer take over the work?

Fixed price, time and materials, or paid discovery

  • Fixed price sets one cost for a defined scope. It suits stable requirements and clear acceptance criteria; watch for narrow assumptions and change-order costs.
  • Time and materials bills for the work actually done. It suits projects that need discovery or iteration; watch for weak budget tracking and unclear priorities.
  • Paid discovery, then a fixed or capped build works well for first-time buyers: the team studies workflows, data, integrations and security needs before committing to a plan.

How to read an estimate

A single number is not an estimate. Ask for what is included, what is excluded and what the figure assumes: discovery, design, development, integrations, data migration, testing, project management, deployment, training and support. Then ask which features are in the first release, which are deferred, how many review rounds are included, whether hosting, licenses and third-party fees are separate, and what would make the estimate change. A clear estimate lets you compare scope, not just price.

Security, data and accessibility questions

Expect specific answers whenever the software handles personal, health, legal, financial or government data:

  • Who can reach our data during development and support, and is real data ever used in testing?
  • Where will the application and database be hosted, and how are backups made and tested?
  • How are sign-in, permissions and administrator actions handled and logged?
  • How are security updates applied after launch, and what happens after a suspected exposure?
  • For a public body: how will forms, documents, maps and payment steps work with screen readers, keyboards and other assistive technology? It is far easier to build accessibility in than to add it later.

Support and maintenance after launch

Launch is not the end. Agree before the project starts on bug fixes for a set period, how support requests are made, hosting and monitoring, security and dependency updates, backups and recovery tests, small improvements, and training. Write down response times, monthly costs and what is billed separately, especially if you have little technical staff.

Red flags

  • A price with no scope or assumptions.
  • No clear process for discovery, design, testing and approval.
  • Reluctance to discuss code ownership or repository access.
  • Vague answers about security, data handling or hosting.
  • No named project lead or communication plan.
  • Claims that complex custom software needs little input from your team.
  • No plan for support after launch.
  • Pressure to sign before you understand the contract.
  • No references or relevant examples.

A red flag does not always mean a company is unqualified, but it should prompt follow-up questions before you proceed.

A scoring checklist for comparing proposals

Score each item from 1 (weak or unclear) to 5 (clear and suitable), and write a note beside each score:

  1. Understands our workflow and users.
  2. Relevant experience with organizations like ours.
  3. Clear discovery and requirements process.
  4. Scope, assumptions and exclusions written down.
  5. Estimate detailed and understandable.
  6. Contract model fits how uncertain the project is.
  7. Security and data handling addressed.
  8. Accessibility addressed, if public-facing.
  9. Code ownership and repository access defined.
  10. Testing, launch and training defined.
  11. Support and maintenance plan included.
  12. References relevant and responsive.

Weigh what matters most for you: a local government may weight accessibility, records and support; a clinic, data handling and permissions; a small business, workflow fit, budget clarity and how easy the software will be to maintain.

Where ASL fits

ASL offers custom software development for Denver and Colorado organizations, from a focused integration to an internal application or an extension of an existing tool. Work starts with a bounded first release that has acceptance checks you can observe, reviewed with representative, approved data.

Source ownership, licenses, access, operating documentation, hosting and support are written into the project agreement, and the plan names who handles incidents, updates and future changes. For existing software, the first step is a review of the current source, how it runs and your permission to change it.

Frequently asked questions

How do I choose a software development company?

Write a short brief, talk to three to five companies using the same questions, compare scope and assumptions rather than totals, check references and code ownership, and score each proposal on the same checklist before you sign.

Should I hire a local software company in Denver?

A local team helps with workshops and Colorado-specific context, but a remote team can work equally well. Choose on relevant experience, clear communication and accountability rather than location alone.

Who should own the code?

Usually your organization, after payment, with the repository under your own account and documentation that would let another developer take over. Settle this in the contract before work starts.

Is fixed price or time and materials better?

Fixed price suits a stable, well-defined scope; time and materials suits work that needs discovery. Many first projects start with a paid discovery phase and then move to a fixed or capped build.

What should a software estimate include?

What is included and excluded, the assumptions behind the number, which features are in the first release, review rounds, testing, project management, deployment, training, support, and any separate hosting or license fees.

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