Build vs Buy Decision Scorecard
Evaluate build versus buy decisions for software and systems. Enter values for instant results with step-by-step formulas.
Worked Examples
Example 1: E-commerce Recommendation Engine
Problem: E-commerce company deciding whether to build custom recommendation engine or buy commercial solution. Core business is product discovery. Strong ML team.
Solution: Build vs Buy Analysis:\n\nBuild Factors:\n✓ Core differentiator: YES (product discovery is the value prop)\n✓ In-house expertise: Strong ML team\n✓ Customization needs: High (unique catalog and user behavior)\n✓ Competitive advantage: Direct impact on conversion\n✗ Cost: High (6-12 months, $500K+)\n✗ Time: 9+ months to production\n\nBuy Factors:\n✓ Speed: 2-4 weeks integration\n✓ Lower upfront cost: $50K-100K/year\n✗ Limited customization: Generic algorithms\n✗ Vendor risk: Dependency on third-party\n✗ Strategic control: Can't iterate as fast\n\nScoring (0-100 scale):\n\nBuild:\n- Cost efficiency: 30 (expensive upfront)\n- Time: 20 (slow)\n- Customization: 90 (full control)\n- Core differentiator: 90 (critical advantage)\n- Expertise: 80 (strong team)\nWeighted Build Score: 68\n\nBuy:\n- S
Result: Tie (68-68) | Recommendation: Buy for MVP, build custom v2 in parallel
Example 2: Internal Tool: Buy Obvious
Problem: Company needs project management tool for 50 employees. Considering building custom solution vs. buying Asana/Monday. Not core business.
Solution: Build vs Buy Analysis:\n\nBuild Factors:\n✗ Core differentiator: NO (internal tool)\n✗ Expertise: Generic engineering, not PM tool experts\n✗ Cost: $200K+ (6 months × 2 devs)\n✓ Customization: Could tailor to exact workflow\n✗ Time: 6-9 months\n✗ Maintenance: Ongoing burden\n\nBuy Factors:\n✓ Speed: 1 week setup\n✓ Cost: $15/user/mo = $9K/year\n✓ Proven solution: Battle-tested\n✓ No maintenance: Vendor updates\n✓ Support: Training, documentation included\n✗ Customization: Limited to platform features\n\nScoring:\n\nBuild:\n- Cost efficiency: 20 (very expensive for internal tool)\n- Time: 30 (slow)\n- Customization: 80 (full control)\n- Core differentiator: 10 (not core business)\n- Expertise: 30 (would need to learn domain)\nWeighted Build Score: 32\n\nBuy:\n- Solution fit: 85 (meets 90% o
Result: Buy 88 vs Build 32 | Obvious buy decision | $9K/year vs $200K+ to build
Example 3: Core Platform: Build Required
Problem: Fintech building payment processing platform. This IS the product. Extremely specific requirements. Strong eng team.
Solution: Build vs Buy Analysis:\n\nContext:\nThis is the core product itself.\nCustomers pay for this functionality.\nDifferentiation is essential.\n\nBuild Factors:\n✓ Core differentiator: 100 (this IS the product)\n✓ Customization: 95 (need full control)\n✓ Expertise: 90 (strong fintech eng team)\n✓ IP ownership: Critical\n✗ Cost: Very high ($2M+)\n✗ Time: 12-18 months\n✗ Regulatory: Complex compliance\n\nBuy Factors:\n✗ Solution fit: 30 (generic won't work)\n✗ Vendor risk: 80 (complete dependency)\n✗ Strategic control: 20 (can't differentiate)\n✓ Speed: 90 (3 months)\n✗ Can't resell: Licensed, not owned\n\nScoring:\n\nBuild:\n- Cost efficiency: 40 (expensive but necessary)\n- Time: 30 (slow but acceptable)\n- Customization: 95 (critical)\n- Core differentiator: 100 (this is the business)\n- Expe
Result: Build 75 vs Buy 42 | Core product = must build | Consider hybrid (Stripe + custom layer)
Frequently Asked Questions
When should you build vs buy software?
Build when: it's core differentiator, no good commercial options exist, you have expertise, and long-term control is critical. Buy when: commodity functionality, speed to market critical, maintain not build is your strength, or costs heavily favor buying.
How do I estimate build costs accurately?
Include: developer salaries × time, opportunity cost (what else they could build), infrastructure, third-party services/APIs, maintenance (30-50% of annual development cost), and feature lag vs. commercial alternatives.
How long does it take to build vs buy?
Buy: hours to days for SaaS, weeks for enterprise. Build: months minimum, often 6-18 months for complex systems. Time-to-market often tips scales toward buying, especially in fast-moving markets.
Should startups build or buy?
Generally buy non-differentiating systems. Startups should focus limited engineering resources on unique value prop. Use Stripe not building payments, Auth0 not building auth, AWS not building infrastructure.
What about build-then-buy or buy-then-build?
Common patterns: Buy for MVP (speed), build later if becomes differentiator. Or: build core, buy periphery (analytics, monitoring). Hybrid strategies are often optimal—pure build or buy is rarely best.
Can I use Build vs Buy Decision Scorecard on a mobile device?
Yes. All calculators on NovaCalculator are fully responsive and work on smartphones, tablets, and desktops. The layout adapts automatically to your screen size.