4 challenges in building custom software solutions for startups

Building custom software solutions for enterprises of any size has always been complex. However, it becomes a little more challenging when the technology solution is geared towards a startup. Startups are—in many cases—run by budding entrepreneurs with bright ideas and lofty visions. But alas, they must also prove their worth in so little time amidst mounting pressures from stakeholders and the unforgiving market competition.

Understanding their requirements, interpreting their market needs, and bringing their projects to fruition, thus, require software developers to go above and beyond to deliver time-critical and pragmatic solutions.

This article highlights all the significant challenges commonly present in software development and the appropriate solutions to mitigate them based on past experiences. We’ve compiled this list to help you and other aspiring entrepreneurs make the right decisions in critical situations and take better precautions against unforeseen pitfalls when building your digital innovation capabilities.

Challenges of building custom software for startups

1. Creating a vague product roadmap

   The problem

   Disruption is the fuel that keeps the innovation engine of every startup running. To that end, however, many believe high volumes of output on paper matter more than quality when it comes to finding a technological breakthrough to shake up the market. Consequently, these fledgling enterprises would attempt to scale quickly by venturing into so much so early. And in doing so, they stretch their resources and workforce beyond their operable thresholds.

   Unsurprisingly, this shortsighted approach leads to severe management issues. Rather than steadily building and improving their software solutions to use as a launchpad, these startups would most likely run into cost overruns, missed deadlines, and a dissatisfied workforce.

   The solution

   A product roadmap contains more than just short-term, measurable milestones that a proprietary application would cross. It lays out the strategic reasoning, feasibility, and financial considerations behind pursuing a software development project.

   It is a detailed blueprint that outlines the overarching vision of your product offering and how it could evolve to the changing market over time without losing sight of your primary business objectives. Only through this strategic guideline can the development team truly understand what the founder has envisioned for their company in terms of end-users, future goals, and strategic planning. Experienced software developers, thus, know how to assist their clients in building a clear product roadmap before starting a development project.

   Case study

   Fundation is a lending and credit solutions provider seeking to transform SMEs’ loan disbursal process nationwide through a streamlined, data-driven digital process. To achieve this, the client required a product roadmap that boasted a robust technology ecosystem, scalability, application security, and sustainable post-launch support.

   To meet the above requirements, we initiated a thorough discovery phase by delving into the company’s existing third-party software systems and proprietary loan assessment algorithm. After the initial studies, we developed the appropriate technical architecture and design, then defined the application’s relevant features and functionalities. Thanks to this detailed plan, we successfully deployed an intuitive software program to simplify Fundation’s loan disbursal procedure.

2. Choosing the wrong development tools

   The problem

   With so many development tools available, choosing the right tech stack for software development might seem like a daunting task. The allure of picking the most mainstream technologies as the safest bet is undoubtedly irresistible to the uninitiated. After all, it seems reasonable to think that newer technologies boast more sophisticated and durable functionalities.

   However, these superficial criteria would only compound problems for startups later on. Not only would they run a risk of incurring more overheads to scale their product, but they would also have greater chances of witnessing severe compatibility issues upon deployment. Thus, finding the correct development tools must be based on how they could work concomitantly to bring your vision to life.

   The solution

   Hiring a team of experts to consult with is the best course of action you can take to find the ideal tech stack for your product development. This is because seasoned developers have profound firsthand experience in identifying which technologies are applicable for certain scenarios and outcomes. More importantly, they would lend their skills to assess the suitability of available tools based on the criteria set in your project. Such benchmarks include the development speed, the product functionalities, and the underlying pain point the software seeks to resolve.

   Case study

   We worked with boutique research firm Covenant Review to develop a web portal that serves as a digital library of legal research on corporate bonds. The application enables investment firms to provide prompt financial advice and recommendations to investors. To fully understand the project requirements, we carefully studied the client’s operational scope, including BI and Analytics, Business Process Automation, and Digital Strategy and Consulting. Given the client’s need for intuitive research database management, we decided to utilize a tech stack with .NET and MS SQL Server tools.

3. Building an application with no market demand

   The problem

   The startup market in the country has seen tremendous growth in funding over the last few years. In 2020 alone, domestic startups received a record-breaking $156.2 billion in venture capital from investors, almost a 12% increase from the previous two years. But that eye-watering amount still paled by comparison to the financial liquidity that VC-funded startups gave in return, which reached $290.1 billion. These lucrative prospects certainly instill much of today’s market confidence in the startup industry.

   However, this positive trajectory also comes at a price. With enough funding resources around to cushion their fall, inexperienced entrepreneurs often get caught up in the idea of building a software solution just for novelty’s sake. They mistakenly believe that as long as you have the means to build an application or an additional feature, there’s almost certainly a market demand that follows.

   On the contrary, the reality shows a much grimmer outlook. Market analysis by CB Insights has found that 38% of failed startups cited the lack of funding as their reason for shutting down—followed by the low market need at 35%. These statistics not only emphasize the importance of conducting in-depth consumer research but also presage the danger of using untested hypotheses as market insights.

   The solution

   Market research allows startups to keep their ear closer to the ground, recognize the customers’ underlying pain points, challenge their initial assumptions, and explore the viability for business expansion. In addition, market research is instrumental in gauging the competitors’ capabilities—helping startups formulate better marketing strategies and more accurate product pricing.

   There are different methods that startups can utilize to garner user insights across touchpoints and stages of development. These include an early-stage prototype showing for a selected focus group, user feedback from MVP/MLP testing and beta testing signups, and market surveys after a full-product or feature rollout.

   Case study

   iBuyAbilene is a free mobile app that aims to promote local businesses in Abilene, Texas, by offering discounts and coupons to the residents. The app was a smashing success during its initial rollout—with some residents even making suggestions to incorporate specific feature enhancements—such as ‘Like a business’ and ‘Boost a business’ buttons. The client—thrilled to see the positive feedback from his community—requested our team to integrate these recommended features into the app to improve the user experience further.

4. Prioritizing one-off software development instead of a long-term product lifecycle

   The problem

   In a bid to remain competitive, most startups turn to custom software solutions to optimize processes and attain greater efficiency. Unfortunately, however, not all show a strong commitment to bringing their technological capabilities to a long-term plan.

   In hopes of clamping down costs and speeding up deployment, cash-strapped founders prefer to engage primarily in short-term developments—only commissioning software developers to find temporary solutions and quick workarounds whenever issues arise.

   This could spell trouble down the road. The failure to consider the bigger picture would leave startups with proprietary applications vulnerable to bugs, security threats, and broken algorithms. Even worse, fixing these problems would become nearly impossible and certainly costly. The flawed codes and frameworks used to patch up errors have become deeply embedded into the program, which only a major overhaul can fix.

   The solution

   A great software development team would understand the significance of building a robust program with room to add more functionalities down the line. Long-term software development allows companies to scale their operations when necessary and future-proof their core strategies. Given that early-stage startups have immense potential to grow and add more value offerings in the next few years, software developers must, therefore, design a custom application that facilitates scalability and resiliency against market uncertainties.

   Case study

   We helped our client create a social networking app called MyCoop to promote resident interactions and community-building in several New York City apartment complexes. This application was also designed as an exclusive marketplace where the residents could buy and sell household items.

   We deployed the product in two phases. In the first phase, to gauge market receptivity, we rolled out an MVP to selected users—primarily those within the client’s closed circle. Upon receiving and incorporating their feedback, we rolled out the app’s final version in the second phase with more comprehensive features to a broader target audience. As an outcome, we delivered a robust, scalable application with a user-friendly interface that brings community members together.

Final thoughts

Early-stage startups often need additional help from experts to realize their founders’ vision. Identifying the hurdles in their industries and building a holistic software solution to suit their needs are challenging but not impossible to achieve. Finding an experienced and diligent development team could go a long way towards establishing budding entrepreneurs and their startups in the competitive market.

Have difficulties in building your software? Reach out to us below and receive a complimentary consultation session to bring your startup vision a step closer to reality.