25 February 2026

You have made the decision. Building your software locally is simply too expensive. You need to move faster, you need access to a larger talent pool, and you need to protect your runway.

Offshore development is the logical next step. And if you are looking for a blend of high-end engineering talent and corporate stability, you are likely looking at Chennai.

Chennai is not just another outsourcing destination. It is the SaaS capital of India. It is a city where global giants like Ford, PayPal, and Amazon have built massive technology centers. The talent pool here is built for long-term product development.

But knowing that Chennai has great developers does not mean every agency in the city is a good fit for you.

The offshore market is crowded. For every brilliant, product-focused agency, there are three mediocre shops that will take your money, write terrible code, and disappear when the product crashes.

If you choose the wrong partner, the money you thought you were saving will vanish into endless bug fixes, missed deadlines, and complete rewrites.

You need a filter. You need a systematic way to separate the true technical partners from the polished sales organizations.

This guide is your filter. We are going to walk through a rigorous, 10-step checklist for vetting an offshore development company in Chennai. If an agency cannot pass these ten steps, you should not give them your money.

Step 1: Define Your Internal Requirements First

You cannot evaluate an agency if you do not know exactly what you want them to do. The biggest mistake founders make is jumping on sales calls with a vague idea.

If you say, "We want to build a marketplace app for dog walkers," a bad agency will say, "Great, that will be $20,000." A good agency will ask you fifty questions you cannot answer.

Before you send a single email to a firm in Chennai, you must prepare your internal documentation.

What you need to prepare:

A Product Requirements Document (PRD): This does not need to be a 100-page manual. But it needs to outline the core user flows. What happens when a user clicks this button? How do payments work?

Your Budget Range: Be realistic. If you only have $5,000, you are not building a secure fintech platform. Knowing your ceiling helps you filter out enterprise agencies that are too expensive.

Your Technical Stack (If Known): If your current backend is built in Node.js, you need an agency that specializes in Node.js. If you do not know what stack you need, your requirement is "needs technical architecture consulting."

Who Will Manage Them: Someone on your side must own this relationship. If you just hand the project over and check back in three months, it will fail. Identify your internal Product Owner right now.

When you bring clear requirements to the table, you instantly command respect. The agency knows they are dealing with a professional, and their estimates will be wildly more accurate.

Step 2: Scrutinize Their Portfolio for Domain Fit

Every agency has a beautiful website. Every agency has a portfolio page filled with sleek iPhone mockups and glowing graphs. Ignore the pretty pictures. You are not hiring a graphic design firm. You are hiring software engineers.

You need to look for domain fit.

Building a simple e-commerce store is fundamentally different from building a healthcare application that handles sensitive patient data. If an agency has spent five years building restaurant menus, they are going to struggle to build your complex financial trading algorithm.

How to audit a portfolio:

Look for similar logic, not just similar industries. If you are building a two-sided marketplace, look to see if they have built multi-user systems with complex payment routing.

Ask about the backend. When they show you a case study, ask them: "What was the hardest technical challenge you solved on this backend?" Listen to how they answer. Are they talking about database scaling and API rate limits, or are they just talking about how nice the buttons look?

Check the scale. Did they build an MVP for a startup with ten users, or did they build a system that handles a million monthly active users?

Chennai has agencies that specialize in almost everything. If you are a B2B SaaS company, find an agency in Chennai that breathes B2B SaaS. Do not settle for a generalist shop.

Step 3: Verify the Actual Talent Pool (Beware the Bait and Switch)

This is the oldest trick in the offshore playbook.

You get on a video call. The agency brings their Chief Technology Officer and a brilliant Senior Architect. They speak perfect English, they understand your vision instantly, and they suggest brilliant architectural changes. You are thrilled. You sign the contract.

The day the project starts, the CTO disappears. Your project is handed off to three junior developers fresh out of college who are learning to code on your dime.

This is the "Bait and Switch." You must protect yourself from it.

How to vet the actual team:

Demand a named team. Before you sign the contract, require the agency to provide the resumes and GitHub profiles of the specific developers who will be assigned to your project.

Interview the developers yourself. Do not just talk to the sales guy. Insist on a 30-minute technical interview with the proposed Lead Developer. If the agency refuses this, walk away immediately.

Put it in the contract. Add a clause stating that key personnel cannot be swapped out without your written approval, and if a swap is necessary, the replacement must pass your interview process.

You are paying for the brains of the people writing the code. Make sure you know exactly whose brains you are renting.

Step 4: Audit Their Tech Stack and Engineering Standards

Bad code works. That is the scary part. A bad developer can build an app that looks fine on the surface and functions perfectly for the first hundred users.

But when you try to add a new feature six months later, everything breaks. When you get a thousand users, the server crashes. This is called technical debt, and it will bankrupt your project.

You need to verify how the agency writes code before they write yours.

Questions to ask about their engineering standards:

"Walk me through your code review process." If they say, "Our senior guy looks it over," that is a fail. You want to hear about automated linting, peer reviews, and strict pull request guidelines.

"How do you handle testing?" Manual testing is not enough. They should be writing automated unit tests and integration tests. Ask what their standard test coverage percentage is.

"Describe your deployment pipeline." They should be using Continuous Integration and Continuous Deployment (CI/CD). Pushing code to production should be an automated, safe process, not a guy dragging files into a server manually.

"What are your security practices for writing code?" Do they follow OWASP top 10 guidelines? How do they store API keys and passwords?

If you are not technical yourself, hire a neutral, third-party technical consultant for three hours. Have them sit on this interview and grade the agency's answers. It will be the best money you spend during this process.

Step 5: Test Their Communication and "Pushback" Factor

Communication is the single biggest point of failure in offshore development. This goes far beyond just speaking English well.

You are looking for cultural compatibility and the willingness to push back.

In many service cultures, the default answer to a client is "Yes."

"Can you build this feature by Friday?" "Yes."

"Is this a good idea?" "Yes."

This "Yes Boss" culture is incredibly dangerous in software development. If you suggest a feature that will ruin the app's performance, you do not want a team that smiles and builds it anyway. You want a team that says, "No, that is a bad idea, and here is a better way to do it."

How to test the pushback factor:

During the interview phase, intentionally suggest a flawed technical approach or an unrealistic deadline.

Say something like, "We want to launch this entire enterprise platform in three weeks. Can you do that?"

If they say yes, they are lying to win the deal. Hang up the phone.

If they say, "No, that is impossible without sacrificing all quality and security. Here is what we can deliver in three weeks," you have found a potential partner. You want a team that acts like a consultant, not an order-taker.

Step 6: Evaluate Their Project Management and Agile Maturity

You are 8,000 miles away from Chennai. You cannot walk down the hall to see how the project is going. You are entirely dependent on their project management system.

Almost every agency will claim they use "Agile methodologies." Most of them just use Jira and still work in a traditional, slow waterfall method. You need to dig into how they actually manage the day-to-day work.

What to look for in their project management:

Total Transparency: Will you have full access to their project management tools (like Jira, Trello, or Linear)? You should be able to log in at any time and see exactly what every developer is working on today.

Daily Standups: Will they commit to a brief, daily video call during your overlap hours? This 15-minute sync is vital for removing roadblocks.

Sprint Reviews: Do they work in one or two-week sprints? At the end of every sprint, they should be showing you working software, not just a PowerPoint presentation about what they plan to do next.

Definition of Done: Ask them how they define "Done." If "Done" means the developer finished typing, that is wrong. "Done" should mean the code is written, reviewed, tested by QA, and successfully deployed to a staging environment.

If an agency is defensive about giving you access to their task boards, it means they are hiding something. Total transparency is non-negotiable.

Step 7: Check Their Security Protocols and IP Protection

When you hire an offshore company, you are handing them the keys to your business. You are giving them your source code, your business logic, and potentially your user data.

You need to know that your Intellectual Property (IP) is safe and that their internal networks are secure.

The security checklist:

The Contract: Your contract must be crystal clear. It must include a strict Non-Disclosure Agreement (NDA). More importantly, it must include a "Work for Hire" clause explicitly stating that you own 100% of the IP, source code, and assets from the moment they are created.

Certifications: Ask if the agency is ISO 27001 certified. This is the international standard for information security. It means they have strict physical and digital protocols in place.

Access Control: How do they manage access to your codebase? They should be using secure VPNs, role-based access controls, and multi-factor authentication.

Employee Vetting: Does the agency run background checks on its developers? What happens when a developer leaves the company? They should have a strict off-boarding process to revoke all access immediately.

Do not just trust them. Read the contract, and have your own lawyer read the contract. Ensure it is enforceable in a relevant jurisdiction.

Step 8: Call Their Past Clients (The Real Reference Check)

Never hire an agency without talking to people who have given them money in the past.

Do not rely on the written testimonials on their website. Do not rely entirely on directory sites like Clutch (though those are a good starting point). Ask the agency to provide the contact information for three current or past clients.

Ideally, ask for clients in your specific region (e.g., if you are in the US, ask for US clients). This helps you judge how they handle your specific time zone.

What to ask on the reference call:

Do not ask softball questions like, "Were they good?" People are generally polite and will say yes. You need to ask behavioral questions.

"Tell me about a time the agency made a major mistake. How did they handle it?" (Every agency makes mistakes. You want to know if they hid it or fixed it).

"How accurate were their initial timelines and cost estimates?"

"Did you ever experience high turnover on your team? How disruptive was it?"

"How is the code quality holding up a year later? Is it easy to maintain?"

"If you had to do the project over again, would you use them?"

Listen closely to the hesitations on the phone. What the reference does not say is often just as revealing as what they do say.

Step 9: Understand the True Pricing Structure

Pricing in offshore development is full of smoke and mirrors. A $20/hour rate might sound amazing, but if they pad the hours, it is more expensive than a $40/hour rate.

You need to understand exactly what you are paying for and what happens when things change.

Identify the Engagement Model:

Fixed Price: You pay a single sum for a specific scope of work. Only use this for very small, highly defined projects. Agencies add a massive risk premium to these quotes. If you want to change a button color halfway through, they will charge you a change fee.

Time and Materials (T&M): You pay for the hours worked. This is more flexible, but you need strict reporting to ensure they are not over-billing.

Dedicated Team: You pay a flat monthly fee for a full-time team. This is usually the most cost-effective model for long-term projects because you avoid the agency's risk premium.

Hunt for Hidden Fees:

Are project management and QA testing included in the developer's hourly rate, or are those billed separately?

Do they charge for server infrastructure, software licenses, or third-party API costs, or do you hold those accounts directly? (Always hold your own accounts).

What happens if a developer is sick or takes a week of vacation? Do you still pay the full monthly fee?

Get a detailed, itemized proposal. If the pricing structure is confusing, it is confusing on purpose.

Step 10: Start with a Paid Trial Project

You have done all the vetting. The agency looks perfect. Their code standards are high, their references are glowing, and the pricing makes sense.

Do not sign a one-year, $200,000 contract yet.

The final step is the test drive. You must propose a small, paid trial project.

Take a small, non-critical feature from your backlog. Ask the agency to build it. Give them a strict two-week timeline and agree on a fixed price for this trial (e.g., $3,000 to $5,000).

What you are testing during the trial:

Onboarding: How fast did they get up to speed on your codebase?

Communication: Did they ask smart questions during the daily standups? Did they respect the overlap hours?

Code Quality: Have your internal team (or your third-party consultant) review the code they deliver. Is it clean, well-commented, and tested?

Delivery: Did they hit the deadline without making excuses?

If they fail the trial project, you have lost a few thousand dollars, but you have saved your business. You simply shake hands and walk away.

If they crush the trial project, you have absolute confidence. You know exactly how they work, you know their code is solid, and you can sign that long-term contract without losing sleep.

Conclusion

Vetting an offshore development company takes time. It requires you to be slightly cynical, highly organized, and willing to ask uncomfortable questions.

Do not rush this process. The talent pool in Chennai is world-class. You can find engineers there who will help you build products that rival anything coming out of Silicon Valley, at a fraction of the cost.

But finding them requires passing on the agencies that look good on paper but fail in practice. Use this ten-step checklist strictly. Demand transparency, test their skills, and protect your IP. Do the hard work upfront, and your offshore team will become your ultimate competitive advantage.