The Real Cost of Cheap Development: When Saving Money Costs You More

EUR 8,000. That's what a founder paid a cheap agency for a marketplace MVP. The rewrite with us cost EUR 32,000. The total: EUR 40,000 for a product that should have cost EUR 30,000 the first time.

This isn't a cautionary tale we made up. We inherited 4 projects from budget agencies in the last 12 months. We have the invoices, the commit histories, and the receipts. Every single rewrite cost more than what a proper build would have cost from day one.

Key Takeaways > - All 4 inherited projects cost more to fix than they would have cost to build correctly the first time. > - The most common problems: no tests, no documentation, copy-pasted code, and security vulnerabilities. > - Cheap development isn't development at a lower price. It's different work that creates different (worse) outcomes.

Project 1: The Marketplace That Couldn't Scale

Original build cost: EUR 8,000 What they got: A marketplace with user profiles, listings, search, and a basic payment flow. Looked fine in demos.

What we found: - No database indexes. Every search query did a full table scan. With 500 listings, the search took 8 seconds. - Authentication was session-based with secrets hardcoded in the codebase. Not in environment variables. In the actual code, committed to Git. - Payment processing had no webhook verification. Anyone could forge a payment confirmation by sending a POST request with the right shape. - Zero tests. Not "not enough tests." Zero. - The entire frontend was server-rendered PHP with jQuery. In 2025.

What we quoted to fix it: EUR 22,000 for a partial rewrite (keep the database, rewrite everything else). The founder decided a full rewrite was less risky.

Full rewrite cost: EUR 32,000 over 2 months.

Total spent: EUR 40,000 for a product that would have cost EUR 28,000-32,000 if built properly the first time. The founder lost 5 months of runway on the original build and the transition.

Project 2: The SaaS With the EUR 2,000/Month Bug

Original build cost: EUR 15,000 What they got: A multi-tenant SaaS with dashboards, user management, and reporting.

What we found: The billing integration was wrong. Not "had a bug." Structurally wrong. The agency used Stripe's one-time payment flow instead of subscriptions. When a user upgraded from the free plan to paid, the system charged them once and never charged them again.

The founder discovered this 3 months after launch when they realized recurring revenue wasn't recurring. They were losing approximately EUR 2,000/month in missed charges. Over 3 months, that's EUR 6,000 in lost revenue plus the EUR 15,000 original build.

What else we found: - Database queries were written in raw SQL with string concatenation. SQL injection vulnerabilities on 6 endpoints. - No rate limiting. The API could be hammered with unlimited requests. - Error handling consisted of try/catch blocks that caught everything and returned "Something went wrong" for every error type. - Environment variables were shared between staging and production. Testing in staging sent real emails to real users.

Fix cost: EUR 18,000 for a partial rewrite focused on billing, security, and API reliability.

Total spent: EUR 33,000 + EUR 6,000 in lost revenue = EUR 39,000 for a product that would have cost EUR 45,000-50,000 to build properly. In this case, the proper build would have been more expensive upfront but wouldn't have leaked EUR 2,000/month.

Project 3: The Mobile App That Couldn't Pass App Store Review

Original build cost: EUR 12,000 What they got: An iOS and Android app built in Flutter.

What we found: The app was rejected by Apple 3 times. The agency hadn't implemented proper data handling for App Store requirements. No data deletion endpoint (required since 2022). No privacy nutrition labels. The app requested camera and location permissions on launch without explaining why.

Beyond the App Store issues: - The app stored authentication tokens in plain text in local storage. Not secure storage. Plain text SharedPreferences. - Push notification implementation didn't handle token refresh. After 30 days, push notifications silently stopped working for every user. - The agency used a state management approach that caused the entire widget tree to rebuild on every state change. The app was visually laggy on anything older than an iPhone 13.

Fix cost: EUR 14,000 to fix the App Store rejection issues, security problems, and performance. Not a full rewrite, but close.

Total spent: EUR 26,000 + 4 months of delays (the app should have launched in December, finally launched in April). The time cost was worse than the money cost. The founder missed their seasonal launch window.

Project 4: The Dashboard That Loaded in 47 Seconds

Original build cost: EUR 6,000 What they got: An analytics dashboard pulling data from multiple sources.

What we found: The main dashboard made 23 sequential API calls on load. Not parallel. Sequential. Each call waited for the previous one to complete before starting. The average load time was 47 seconds.

The agency had built the frontend as a single component with 4,200 lines of JavaScript in one file. No component architecture. No state management. Just one massive file that did everything.

What else: - No caching. Every page load fetched everything from scratch. - Charts were rendered using a library that was deprecated 2 years ago. It didn't support the latest Chrome versions and displayed incorrectly on Safari. - The API had no pagination. Requesting "all users" returned every user in the database. With 10,000 users, this was a 30MB JSON response.

Fix cost: EUR 11,000 for a frontend rewrite with proper architecture and API optimization.

Total spent: EUR 17,000 for a dashboard that would have cost EUR 12,000-15,000 built properly.

The Pattern: What Cheap Agencies Do Differently

After inheriting these 4 codebases, the pattern is clear. Cheap agencies don't write worse code. They skip different steps entirely.

They skip testing. Not one of the 4 projects had a single test. Writing tests adds 20-30% to development time. Cheap agencies cut this to hit their price point. The cost of zero tests surfaces months later when every change introduces regressions.

They skip security. Proper authentication, input validation, rate limiting, and secret management add 15-20% to development time. Cheap agencies skip all of it. The cost surfaces when someone exploits a vulnerability or an App Store review catches it.

They skip documentation. Documentation adds 10-15% to development time. Without it, the next developer spends weeks understanding the codebase. That's money the founder pays to the next team, not the original agency.

They skip architecture. Planning a clean component structure, database schema, and API design takes time. Cheap agencies start coding immediately. The result is code that works for the demo but collapses under real usage.

They don't skip features. This is the key insight. The cheap agency delivers the same features. The demos look the same. The founder sees working software and thinks they got a deal. The difference is invisible until it's expensive.

The Contrarian Take: Sometimes Cheap Development Is the Right Choice

We're about to lose some credibility with cheap agency owners, but we need to be honest with founders too: there are cases where the cheap build is fine.

Throwaway prototypes. If you need a clickable demo for investor meetings and plan to rebuild from scratch after funding, a EUR 5k prototype is fine. Just don't pretend it's production software.

Validation-only MVPs. If the entire point is to test whether anyone wants the product and you'll trash the code regardless, optimize for speed and cost, not quality.

Static sites and simple landing pages. There's not much to get wrong on a 5-page marketing site. The quality gap between a EUR 2k and EUR 5k landing page is smaller than between a EUR 8k and EUR 30k SaaS.

The problem isn't cheap development itself. The problem is founders who buy cheap development and expect production quality. A EUR 8k marketplace will never be production-ready. It can be a prototype. It can validate an idea. It cannot run a business.

How to Spot a Cheap Agency Before You Hire Them

Red flags we've seen in the agencies whose work we inherited:

"We can build anything for EUR 10k." No, they can't. They can build a demo of anything for EUR 10k. A demo is not a product.

No portfolio of long-running products. Check their past work. Is it still live? Is it still being used? A portfolio of screenshots proves nothing. Working products that handle real users prove everything.

No technical discussion during sales. If the agency doesn't ask about your database needs, your scaling expectations, your security requirements, or your deployment preferences - they're not planning to address any of those things.

Fixed timeline regardless of scope. "Every project takes 4-6 weeks" means every project gets 4-6 weeks of effort, whether it needs 2 or 12. Complex projects get rushed. Simple projects get padded.

They don't mention testing, documentation, or handoff. These are the three things cheap agencies skip. If they're not in the proposal, they're not in the project.

What Proper Development Actually Costs (And Why)

When we quote EUR 30k for a project that a cheap agency quotes EUR 8k, founders ask: "Where does the extra EUR 22k go?"

Here's the breakdown:

- Testing (20% of total): Unit tests, integration tests, end-to-end tests. Catches bugs before users do. - Security (15% of total): Authentication, authorization, input validation, rate limiting, secret management. - Documentation (10% of total): Architecture docs, deployment guides, decision logs. Enables handoff. - Architecture (10% of total): Schema design, API design, component structure. Enables scaling. - DevOps (10% of total): CI/CD, monitoring, alerting, staging environment. Enables reliable deployments. - Core features (35% of total): The actual features.

The cheap agency spends 90% of their time on features and 10% on a basic deployment. The features work in demos. Everything else is missing.

Frequently Asked Questions

How do I know if my current codebase was built cheaply?

Run these checks: Are there any automated tests? Is there documentation beyond a README? Are secrets stored in environment variables (not hardcoded)? Does the API validate input and handle errors specifically? Is there a staging environment separate from production? If the answer to three or more of these is no, the codebase was built cheaply.

Is it better to fix a cheap codebase or rewrite it?

It depends on the ratio of good code to bad code. If the database schema is sound and the API structure makes sense, fixing specific issues (security, testing, performance) is cheaper. If the architecture is fundamentally broken - no separation of concerns, no proper data model, no error handling throughout - a rewrite is usually cheaper and faster than patching.

What's a fair price for an MVP?

For a SaaS MVP with authentication, a core feature loop, basic dashboards, and payment processing: EUR 25,000-40,000 depending on complexity. Below EUR 20k, you're likely getting a prototype, not a product. That's fine if you know that going in.

How do we avoid getting burned by an agency again?

Ask for references from clients whose projects are still running. Ask to see their testing, documentation, and deployment practices - not just their designs. Include a technical review milestone 4 weeks into the project where an independent developer reviews the code quality. And never, ever pay 100% upfront.

*Inherited a codebase that needs rescuing? Book a 30-minute call for a free assessment. We'll tell you honestly whether to fix it or rewrite it. Or see our services for pricing on new builds that are done properly the first time.*