Choosing a pricing model is choosing who carries the uncertainty. Use fixed price when the scope can be written down and tested, time and materials when you need to steer week by week, a dedicated team when you have your own product lead and need more capacity, and a fixed-price monthly team when you want ongoing delivery without managing engineers yourself. With us, projects get a fixed price after discovery, typically €30,000–150,000, and our Delivery Pods cost €4,200–23,000 a month. This guide is for CTOs, CEOs and procurement leads comparing offers from development partners.
What are the main software development pricing models?
- Fixed price: you agree a scope, a price and acceptance criteria up front, and the vendor delivers that scope for that price.
- Time and materials (T&M): you pay for the hours actually worked at agreed rates, and you can change priorities as you go.
- Dedicated team or staff augmentation: named engineers join your team full time or part time, and your own product lead decides what they work on.
- Delivery Pod: our fixed-price monthly team. You set the priorities; we run delivery with a defined capacity, release rhythm and response times.
| Model | You pay for | Who carries scope risk | Who manages the work | Minimum term | Best for | Our price (excl. VAT) |
|---|---|---|---|---|---|---|
| Fixed price | A defined result | The vendor, within the agreed scope | The vendor | The project | A scope you can write down and test | Typically €30,000–150,000; AI launch €20,000–35,000 |
| Time and materials | Hours worked | You | You, or the vendor on your behalf | Usually none | Unclear scope, inherited code, research | From €45/hour mid-level, €60/hour senior |
| Dedicated team / staff augmentation | Named people’s time | You | You | Often one month or more | Teams with a product lead who need capacity | About €7,500–10,000 per engineer per month |
| Delivery Pod | A team with fixed monthly capacity | Shared: you set priorities, we own delivery | Us, with your priorities | 1 month (Build: 3 months) | Ongoing product work on a live system | €4,200–23,000 per month |
When does fixed price work?
Fixed price works when you can describe what done means and check it. In practice that requires discovery first: a short phase where we map the workflow, the integrations and the acceptance criteria. Without it, a fixed price is a guess with a risk buffer on top.
How we run fixed-price projects:
- Discovery produces a written scope, a list of assumptions and exclusions, and acceptance criteria per milestone.
- You get a fixed price, paid against milestones written into the proposal. The AI Production Launch, for example, is paid 30% at signing, 40% at the mid-point demo and 30% at production acceptance.
- Changes go through a written change request that states the cost and the effect on the timeline. You approve it or drop it.
- The first sprint is covered by our first-sprint guarantee: before we start, we agree in writing what the first two-week sprint must deliver. If the sprint-1 demo doesn’t meet those acceptance criteria, you can stop and you don’t pay for that sprint.
Fixed price fails when the goal is vague, when nobody on the client side can make decisions, or when the vendor quotes without discovery. It also fails quietly when the vendor protects its margin by cutting tests and documentation, so put quality requirements such as automated tests, code review and a handover package in the acceptance criteria.
AI work can be fixed price too, if the scope is written down with measurable acceptance criteria. That is how our AI Production Launch works: one to three AI workflows into production in up to 6 weeks, at a fixed price of €20,000–35,000, starting with a 5-day audit for €3,500 that sets the price and is credited in full if the launch starts within 60 days.
When is time and materials the better choice?
T&M is the honest model when nobody can write the scope down yet. Typical cases are an inherited codebase with unknown problems, research and prototyping, or an internal team that needs more hands on its own backlog.
T&M only works with governance on your side. Agree a budget cap per phase, a demo every one or two weeks and a short written report on hours against progress. If you have no product owner with time every week, T&M turns into expensive activity.
Our engineers cost from €45/hour (mid-level) and €60/hour (senior). Full time that is roughly €7,500–10,000 a month per engineer.
What do you get with a dedicated team or staff augmentation?
Staff augmentation means hiring engineers from a partner to work inside your team, under your management. You get capacity without recruiting; you keep control of priorities, architecture decisions and day-to-day planning.
Our engineers work from Ukraine, one hour ahead of Sweden, and you sign a Swedish contract with Smoother Development AB. Before anyone in Ukraine touches personal data, we sign a data processing agreement with Standard Contractual Clauses. Contracts are flexible from one month. For the full comparison with handing over a whole project, see staff augmentation vs outsourcing.
How does a fixed-price monthly team work?
A Delivery Pod is a team at a fixed monthly price. You bring the roadmap and the priorities; we plan, build, test and release, with a senior engineer responsible for architecture and code quality. Every pod includes new features and maintenance, except Care Lite, which is maintenance only.
| Pod | Price per month | Team | Capacity or scope | Releases | Minimum term |
|---|---|---|---|---|---|
| Care Lite | €4,200 | Senior review of every change | Updates, monitoring, small fixes | Monthly | Month to month |
| Start Pod | €8,200 | 1 mid-level developer, 0.3 senior, shared QA, DevOps and PM | Up to about 190 hours | Every two weeks | 1 month, then month to month |
| Scale Pod | €14,000 | 1 senior and 1 mid-level developer, shared PM, QA automation | Up to about 260 hours | Weekly | 1 month, then month to month |
| Build Pod | €23,000 | 2 senior and 1 mid-level developer, dedicated PM, shared QA, DevOps and UX | Up to about 420 hours | Weekly | 3 months, then month to month |
Pods are prepaid monthly, and every pod has 30 days’ notice. The difference from T&M is what you buy: not hours, but a team with a release rhythm, response times and a written delivery report. The difference from staff augmentation is who runs delivery. With a pod, that’s us.
Which pricing model should you choose?
Answer these in order:
- Is the system live and only needs care (updates, monitoring, small fixes)? Care Lite.
- Can you write down what done means for the next three to six months? Fixed price after discovery.
- Are you inheriting code nobody fully understands? Start with a code audit (from €1,900), then fixed price per phase.
- Do you have a product lead with time every week and a backlog ready? T&M or staff augmentation.
- Do you have a steady stream of priorities on a live product, but no one to manage engineers? A Delivery Pod.
Many engagements combine models over time: a paid audit or discovery, a fixed-price first release, then a pod to keep the product moving. That mirrors how uncertainty actually changes, high at the start and lower once the system is live. For what the projects themselves cost, see how much custom software development costs.
Which contract terms matter more than the model?
- Code ownership: with us you own the code once it’s paid, and it lives in your repository.
- Law and counterparty: a Swedish contract under Swedish law, with a Swedish company you can hold accountable.
- Data: a data processing agreement before anyone touches personal data, and EU hosting by default.
- Terms and notice: minimum terms and notice periods in writing before you sign.
- Change control: one written route for changes, with cost and timeline impact.
- Quality: tests, code review, documentation and a handover package as deliverables, not promises.
Red flags in any model: a fixed price without an assumptions list, T&M without regular demos, and no named senior engineer before you sign.
What to do next
If you know roughly what you need but not which model fits, tell us about the work and your timeline. A founder replies, usually within one business day, with a suggested setup and price. All our prices, including the AI Production Launch, Delivery Pods and e-commerce packages, are on the pricing page.
