9 Warning Signs of a Bad Development Agency
Most failed software projects were predictable during the sales process. These are the warning signs we would look for if we were the ones hiring, and the questions that surface them early.
Published · 16.04.18
Red flags in the sales conversation
The pattern is consistent: enthusiasm about your idea, vagueness about the work.
- A price quoted before anyone asked what the product does.
- No named engineers — you meet a salesperson and never the team.
- Case studies with no live link to a product you can actually open.
- “Yes” to every requirement, including the contradictory ones.
- Pressure to sign a long retainer before any scope exists.
Red flags in the contract
Read the ownership and exit clauses first. If the answer to “what happens if we part ways” is unclear, that is the whole review.
- IP transferred only after final payment of an open-ended engagement.
- Code hosted in the agency's repository and accounts rather than yours.
- No definition of done, no acceptance criteria, no warranty period.
- Hosting and domains registered under the agency's name.
The five questions that settle it
Ask these on the first call. Good partners answer them immediately; weak ones deflect.
- Who exactly writes the code, and how senior are they?
- Can I see a product you built that is live and still maintained?
- What is fixed in this price, and what would be a change order?
- Whose accounts hold the repository, cloud and app-store listings?
- What is your response path if production breaks on a Saturday?
Frequently asked questions
Is a very low quote always a bad sign?
Not automatically, but ask what it excludes. Low quotes usually assume a narrower scope, junior engineers, or a change-order model that recovers the difference later.
Should I pay for discovery?
A short paid discovery that produces a scope, architecture and fixed quote is fair and valuable. Open-ended discovery with no deliverable is not.